At the Green Door restaurant, customers line up, take a plate, then fill it with their choice of items from the restaurant's vegetarian buffet. At the cash each plate is weighed, and the customer's bill is calculated: price per gram*grams of food taken=cost of dinner.
This pricing scheme creates an interesting choice problem. It might appear that the best strategy would be to load up one's plate with the items that cost the most, in terms of price per gram, to prepare. So the savvy restaurant goer should stock up on avocado salad, because avocados are very expensive in Canada, but eschew the rice and the beetroot salad, because rice is easy to cook at home, and beetroots are one of the cheapest vegetables available.
Personally, I always help myself to a generous spoonful of avocado salad. However I've found that maximizing "value" in terms of the preparation cost per gram of the items on one's plate generally produces a sub-par dining experience. For example, one of the tastiest items at the buffet is a potato-kale bake, loaded with butter, cheese and cream. Because potato and kale are cheap, it probably has a fairly low cost per gram. But to pass it over on cost grounds means missing out on a delicious dish. Also, some of the healthiest items, like the bean curries and the rice, are some of the cheapest to prepare. A dinner made up entirely of high cost-per-gram items may not be as healthy or satisfying as a dinner that includes low cost-per-gram items.
Perhaps the solution, then, is to ignore cost considerations entirely, and just fill one's plate with whatever takes one's fancy?
Not quite. The Green Door has been in business for many years, and its owners are pretty savvy. They didn't have to read Nudge to work out that people fill their plates with the first items they come to in the buffet line-up. The avocado salad is generally positioned towards the back of the buffet. The less expensive potato-kale bake and broccoli-tofu stir-fry are prominently featured. Actually, I may be doing the restauranteurs a disservice here - I've been told that the positioning of the items simply reflects their popularity. But whatever the reasoning behind the buffet set-up, the point is still valid: it's hard to select "whatever takes one's fancy" when the choice architecture in place nudges one towards making particular decisions.
Undergraduate education in Canada uses roughly the same pricing strategy as the Green Door restaurant. The price students pay per course is more or less the same, regardless of the actual costs of delivering the course, or the value - either the entertainment value or the "human capital formation" value - of the course in question. BA students pay the same fee for being in a class of 15 students taught by a full professor paid $150,000 per year as they do for being in a class of 300 students taught by a contract instructor paid $10,000 per course. Students pay the same fee for courses with ultra-low-cost multiple choice examinations, based on questions straight from the test bank provided to the instructor with the textbook, as they do for courses where the instructor puts in 60 or 70 hours weeks so he or she can read and comment on his or her students' essays. Students pay the same fee whether the professor is conscientious or irresponsible, and regardless of whether or not the course imparts valuable skills (though the cost per course is higher in some degrees, for example, a Bachelor of Computer Science or Bachelor of Engineering, than in other degrees, for example, a Bachelor of Arts).