> If it's free, people are suspicious and judge the cost to be something implicit, generally with a higher expected cost than $1. On the other hand if you make the cost explicit, people are more comfortable.
To address your point explicitly, if someone believes the cost of a hug is higher than $1 ("higher than expected cost"), then offering one for $1 should trigger a similar suspicion in your head.
Think about it, if a stranger offered you a free Porsche, you'd rightly be suspicious. Would you be less suspicious if they offered that same car for $500?
