4 ms·

I stick by the title. No, it's not a crime, but there's definitely a disingenuous aspect to overcharging for a product.

pdonis 11y ago
"Overcharging" compared to what? If you mean, compared to other stores selling the same product at the same time, consumers have access to the same information that this study did. If it's worth it to them to seek out a better deal, they have the information to do so. If they decide it's not worth it to them, how is that the store's fault? What you are calling "overcharging" is actually just the free market at work. Stores vary prices in order to find out what the best price for them to charge is--"best" meaning the price that maximizes their profit. Customers evaluate prices in order to find out what the best price for them to pay is--"best" meaning the price that maximizes their benefit from the purchase--the value of the item to them minus the cost. But "cost" includeds the time and effort spent price searching, and different people place different values on their time and effort relative to other things. So in a free market, you should expect to see different prices for the same product at the same time at different stores, because they are selling to different customers with different relative priorities. It would be a lot more suspicious to see the same item sold for exactly the same price at every store--that would mean the market is not a free market any more.
- popra 11y ago
  They're overcharging today compared to yesterday, so that tomorrow, on the day of the sale event, they can display a bigger discount. And all of that to "incentivize" (read trick) the buyer to spend his money. It has nothing to do with free markets at work. It's simply a shady, dubious practice.
  - pdonis 11y ago
    The definition of "free market" is that all transactions are voluntary. If what is being sold is not worth the price the buyer would have to pay for it, the buyer can simply choose not to buy it. But whether or not that's true has nothing whatever to do with what price the same item sold for last week. It does have something to do with what price the same item might sell for next week, if that price will be enough lower than the current price to make it worth it to the buyer to wait a week. But that's for the buyer to judge. If you think buyers are somehow unable to tell when they are being tricked into buying something they don't really need, then you think free markets are basically impossible because you've defined "voluntary" out of existence. The problem with that is that all other methods of regulating the behavior of sellers do even worse. People who are in favor of free markets, like me, aren't in favor of them because we think they're perfect; we only think they're the best we can do. Often there is no perfect solution, since we don't have any omnipotent benevolent dictators to run our economies for us.
    - popra 11y ago
      > The problem with that is that all other methods of regulating the behavior of sellers do even worse. I think this is where our views diverge. In essence what they're doing is false advertising: "buy this product because it's at X% discount!!!" when in reality it's at a lower discount or in some cases it's not even discounted. Advertising is regulated, and there are good reasons for that, just think about an ad like "smoke cigarettes, they cure cancer" (granted, hopefully, an overblown example). Some view free markets as a goal onto themselves, I think this is a mistake. The goal is (or should be) a good society, whatever your definition for "good society" is. Just because the best societies so far developed using some forms of "free markets", doesn't mean that pure to the extreme free markets would be a better means to the goal when compared to more regulated markets. > The definition of "free market" is that all transactions are voluntary. That is correct, once both parties agree to the terms (price, quantity, quality, deadlines and so on) the transaction goes through. People usually view governments (the regulator) as third (intrusive) parties to the transaction, that's not true. Governments are representatives of the people, and as such, regulators simply add a priori terms to a transaction. Historically, regulation has managed to right some (not all) of the more awful side effects of free markets, including: child labor, deadly workplaces, labor bordering slavery, labor inequality, disastrous environmental externalities and more. Is regulation always perfect? No. But then again, by your own admission neither are free markets :).
      - pdonis 11y ago
        > I think this is where our views diverge. Nothing you say in any way establishes that regulation by government works better than regulation by free market participants. All you're doing is describing what government regulation does. > People usually view governments (the regulator) as third (intrusive) parties to the transaction, that's not true. Certainly it is. Government regulators do not give or receive anything as part of the transaction, which is the definition of "a party to the transaction". > Governments are representatives of the people, and as such, regulators simply add a priori terms to a transaction. And those terms are not voluntarily chosen by the parties; the parties have to accept them whether they would choose to in the absence of the regulations or not. Therefore the transaction is not voluntary. > Historically, regulation has managed to right some (not all) of the more awful side effects of free markets, including: child labor, deadly workplaces, labor bordering slavery, labor inequality, disastrous environmental externalities and more. To the extent these things were "awful" (some, like child labor and labor inequality, weren't necessarily that way), they were not "side effects of free markets". They were side effects of markets that were meddled with by governments in different ways than governments meddle now. (Slavery, for example, was clearly not the result of a free market transaction; the slaves didn't voluntarily agree to be slaves. It could only exist because governments legitimized the taking of slaves by force.)
- unsettledtck 11y ago
  By overcharging, I mean that we compared prices to a baseline day in January (the 13th, to be exact) and then showed those prices against what was on offer from other retailers. Consumers do have access to this information and their buying decisions are their own. And that's true, this study reinforces the free market system we have. There is something to be said for the shadiness of certain retailers elevating their prices on days that are being touted as "sale" days.
  - pdonis 11y ago
    In other words, you're using "overcharging" to mean "the price went up". That doesn't seem like a very good use of language; there are lots of valid reasons why the price might have gone up. As for retailers using the word "sale" to mean "we raised the price a week ago and now we're dropping it back to where it was before, in the hope that you'll think it's a great deal", that could certainly be described as "shadiness", yes, but since you appear to agree with the market being free, the free market should sort that out just fine. If such practices hurt consumers, on net, then consumers can respond by not buying from such retailers.
sre_ops 11y ago
Why? It is called price discrimination and it is a fantastic way to maximize the price charged for a product.
tyingq 11y ago
"Overcharging" is not necessarily as easy to identify as you might think. We sell some niche items that happen to also be available on eBay for less. People pay us more, willingly, because they know we'll be around in the future for help, warranty issues, etc.

"Overcharging" compared to what? If you mean, compared to other stores selling the same product at the same time, consumers have access to the same information that this study did. If it's worth it to them to seek out a better deal, they have the information to do so. If they decide it's not worth it to them, how is that the store's fault? What you are calling "overcharging" is actually just the free market at work. Stores vary prices in order to find out what the best price for them to charge is--"best" meaning the price that maximizes their profit. Customers evaluate prices in order to find out what the best price for them to pay is--"best" meaning the price that maximizes their benefit from the purchase--the value of the item to them minus the cost. But "cost" includeds the time and effort spent price searching, and different people place different values on their time and effort relative to other things. So in a free market, you should expect to see different prices for the same product at the same time at different stores, because they are selling to different customers with different relative priorities. It would be a lot more suspicious to see the same item sold for exactly the same price at every store--that would mean the market is not a free market any more.

popra 11y ago
They're overcharging today compared to yesterday, so that tomorrow, on the day of the sale event, they can display a bigger discount. And all of that to "incentivize" (read trick) the buyer to spend his money. It has nothing to do with free markets at work. It's simply a shady, dubious practice.
- pdonis 11y ago
  The definition of "free market" is that all transactions are voluntary. If what is being sold is not worth the price the buyer would have to pay for it, the buyer can simply choose not to buy it. But whether or not that's true has nothing whatever to do with what price the same item sold for last week. It does have something to do with what price the same item might sell for next week, if that price will be enough lower than the current price to make it worth it to the buyer to wait a week. But that's for the buyer to judge. If you think buyers are somehow unable to tell when they are being tricked into buying something they don't really need, then you think free markets are basically impossible because you've defined "voluntary" out of existence. The problem with that is that all other methods of regulating the behavior of sellers do even worse. People who are in favor of free markets, like me, aren't in favor of them because we think they're perfect; we only think they're the best we can do. Often there is no perfect solution, since we don't have any omnipotent benevolent dictators to run our economies for us.
  - popra 11y ago
    > The problem with that is that all other methods of regulating the behavior of sellers do even worse. I think this is where our views diverge. In essence what they're doing is false advertising: "buy this product because it's at X% discount!!!" when in reality it's at a lower discount or in some cases it's not even discounted. Advertising is regulated, and there are good reasons for that, just think about an ad like "smoke cigarettes, they cure cancer" (granted, hopefully, an overblown example). Some view free markets as a goal onto themselves, I think this is a mistake. The goal is (or should be) a good society, whatever your definition for "good society" is. Just because the best societies so far developed using some forms of "free markets", doesn't mean that pure to the extreme free markets would be a better means to the goal when compared to more regulated markets. > The definition of "free market" is that all transactions are voluntary. That is correct, once both parties agree to the terms (price, quantity, quality, deadlines and so on) the transaction goes through. People usually view governments (the regulator) as third (intrusive) parties to the transaction, that's not true. Governments are representatives of the people, and as such, regulators simply add a priori terms to a transaction. Historically, regulation has managed to right some (not all) of the more awful side effects of free markets, including: child labor, deadly workplaces, labor bordering slavery, labor inequality, disastrous environmental externalities and more. Is regulation always perfect? No. But then again, by your own admission neither are free markets :).
    - pdonis 11y ago
      > I think this is where our views diverge. Nothing you say in any way establishes that regulation by government works better than regulation by free market participants. All you're doing is describing what government regulation does. > People usually view governments (the regulator) as third (intrusive) parties to the transaction, that's not true. Certainly it is. Government regulators do not give or receive anything as part of the transaction, which is the definition of "a party to the transaction". > Governments are representatives of the people, and as such, regulators simply add a priori terms to a transaction. And those terms are not voluntarily chosen by the parties; the parties have to accept them whether they would choose to in the absence of the regulations or not. Therefore the transaction is not voluntary. > Historically, regulation has managed to right some (not all) of the more awful side effects of free markets, including: child labor, deadly workplaces, labor bordering slavery, labor inequality, disastrous environmental externalities and more. To the extent these things were "awful" (some, like child labor and labor inequality, weren't necessarily that way), they were not "side effects of free markets". They were side effects of markets that were meddled with by governments in different ways than governments meddle now. (Slavery, for example, was clearly not the result of a free market transaction; the slaves didn't voluntarily agree to be slaves. It could only exist because governments legitimized the taking of slaves by force.)
unsettledtck 11y ago
By overcharging, I mean that we compared prices to a baseline day in January (the 13th, to be exact) and then showed those prices against what was on offer from other retailers. Consumers do have access to this information and their buying decisions are their own. And that's true, this study reinforces the free market system we have. There is something to be said for the shadiness of certain retailers elevating their prices on days that are being touted as "sale" days.
- pdonis 11y ago
  In other words, you're using "overcharging" to mean "the price went up". That doesn't seem like a very good use of language; there are lots of valid reasons why the price might have gone up. As for retailers using the word "sale" to mean "we raised the price a week ago and now we're dropping it back to where it was before, in the hope that you'll think it's a great deal", that could certainly be described as "shadiness", yes, but since you appear to agree with the market being free, the free market should sort that out just fine. If such practices hurt consumers, on net, then consumers can respond by not buying from such retailers.

sre_ops 11y ago

Why? It is called price discrimination and it is a fantastic way to maximize the price charged for a product.

tyingq 11y ago

"Overcharging" is not necessarily as easy to identify as you might think. We sell some niche items that happen to also be available on eBay for less. People pay us more, willingly, because they know we'll be around in the future for help, warranty issues, etc.