A basic iced cappuccino for nearly 600 rupees?!

A basic iced cappuccino for nearly 600 rupees? Ridiculous? Yes. But the economics are understandable I guess. There’s only two cafés at the departure area of the Bandaranaike Int’l Airport and Coffee Bean is the only one with a substantial seating area and offering free wifi for customers. Coffee Bean will naturally exhibit profit maximising behaviour, using the near monopoly situation they have. They also have to make up for what is probably a very high monthly rent for their prime shop space. This book – ‘The Economic Naturalist’ by Bob Frank – has an interesting chapter that dissects the pricing dynamics of cafés in departure terminals of train stations.

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