Economics of Rewards Programs

This week, we dive into the economics behind rewards programs and credit card perks. We explore how loyalty schemes influence consumer behavior and how companies use them strategically. The episode covers travel points, airline upgrades, hotel loyalty tiers, and their broader economic implications. We also consider who really foots the bill for all those “free” perks.

In this episode, we discuss:

* Why companies offer points, perks, and loyalty rewards, and how they profit from it

* The trade-offs consumers make to stay loyal to specific brands or services

* How status tiers shape trav...