The market for the assassination of John Wick has absolutely failed, at least through three films. Lots of people want him dead. They keep sending people to kill him. Those people keep getting killed. Why?
John Wick 4 is in theatres now, I enjoyed it thoroughly, this discussion will have no spoilers. The question I want to ask is: how is this character still alive to inhabit a fourth film? Is he immortal? Some sort of demon or demi-god? No.
John Wick survived three films because the market for assassination is run by a oligopsonistic cartel (“The High Table”) with extreme price-setting power. And that cartel is simply not willing to pay the necessary price. John Wick lives because the High Table is a bunch of penny-pinching cheapskates.
Point of fact: trying to kill John Wick is dangerous. Everyone who tries to dies. Through the first three films he has killed 114 people. If you want someone to take on a dangerous job, you have to pay them accordingly. In economics we refer to this as compensating wage differentials. Killing John Wick is more than just dangerous, however. It’s also a tournament. It’s an open contract and only one person, the successful assassin, receives payment. So you, the would-be assassin who is considering entering this market, has to consider both the probability of success and the probability of your own death. The two are, of course, also inextricably related. So how much do you value your own life?
The value of statistical life in 2016 was somewhere around $9.6 million dollars. Updating that into 2023 dollars based on nothing but inflation pushes us to about $12 million. If we are to assume that the 115th person actually is successful in their task (which is a pretty heroic assumption considering the low probability that John Wick dies in the first 5 minutes of a nearly 3 hour 4th film), the you should expect that a less than 1% chance of success and that in your failure you will also lose your life. The appropriate compensating wage differentials should in turn be in the neighborhood of $1.38 billion.
That’s just the additional compensation on top of the standard wages that clear the market for individuals with the kind of skill set and, ahem, demeanor necessary to enter the high end assassin labor market. The market clearing price in question is likely closer to $1.5 billion. By the end of John Wick 3, the bounty on his head reaches a paltry $14 million, which is tells you all you need to know about the High Table. They just don’t get the economics of the situation they are in. You can’t treat killing John Wick like a standard labor market transaction for the same reason you can’t pay uniform wages for cleaning windows. Sometimes you need the first floor cleaned. Sometimes the 80th floor. Sometimes the inside of the windows. Sometimes the outside.
John Wick 4 is in theaters because The High Table ignored the first rule of economics. You get what you pay for.
Economist Writing Every Day 