5 ms·

Or you know, this is him making a living (I assume) of providing a good at a certain price, which allows everyone in his community who buys it right now to enjo

by igk 10y ago

Or you know, this is him making a living (I assume) of providing a good at a certain price, which allows everyone in his community who buys it right now to enjoy it. They know and trust him and are willing (I assume) to pay a little extra for that. If everybody is already happy, there is not really a point in and of itself to imagine how you could squeeze even more out of people. Not everything needs to be ruthless capitalism to work

moron4hire 10y ago
You have it exactly backwards. People willingly paying for a good means they are happy with the purchase, and just as many people will be happy at the higher price if he's still selling out every week. It's not "ruthless capitalism", it's protecting your supply and communicating the correct value. If prices get high enough, it will attract other people to become honey producers, increasing the supply and making more people happy. By keeping prices low, artificial scarcity is created, which is a harm to consumers.
- adwn 10y ago
  > By keeping prices low, artificial scarcity is created, which is a harm to consumers. No: If a producer can't satisfy demand at his/her prices, then that leaves room for a competitor with higher prices to come in. There, artificial scarcity crisis averted.
  - bawana 10y ago
    The problem with most economic theories is that they neglect the phenomenon of entitlement. Since welfare was invented, more and more people find the utility of their choices distorted. They will spend discretionary income on luxury goods and use welfare to obtain the necessities. I find more and more people using their cash to buy cell phones, big screen tv, etc. but they are still unemployed, getting Medicaid as well as disability income sometimes. So the decision to purchase a luxury good (like honey) sometimes does not respond to price hikes as one would expect. Normal users might stop buying it as the price goes up but 'entitled' users may continue buying it and thus they become even more dependent on welfare (and our taxes) for survival.
    - pc86 10y ago
      Where do you live that earned income does not affect welfare income? I make a good living and can't go out and buy a Maserati then say "oh darn I'm out of money, better go grab a welfare check for groceries this week." If someone's buying $20 jars of locally sourced honey they're almost certainly not on welfare.
      - brbsix 10y ago
        Welfare income is not affected by money earned working under the table or selling drugs.
        coldtea 10y ago
        There are tens of millions of recipients of welfare income. The idea that any statistical significant number of them is selling drugs is so out of touch with reality (and borderline racist, because it draws from minority stereotypes first and foremost) that it's not even funny.
        brbsix 10y ago
        OP wondered in what circumstances people have money for luxury goods yet still qualify for welfare, so I named two. I've come across plenty of people who receive some sort of public aid (e.g. subsidized housing, SNAP, Medi-Cal) who fall in the aforementioned categories. I don't have the slightest clue how representative they are and I don't really care one way or another. Whatever interpretations you make of this are yours alone.
    - coldtea 10y ago
      That's mostly a myth, from observing poor blacks etc sporting expensive sneakers or some large-ass TV, and assuming their spending habits are generally like that. Those "luxury items" are not what the huge majority of welfare spending is about, and welfare is not the reason for them (people which make very little without welfare also splurge for similar purchases -- they serve as compensating factors for the lack of means, and even serve to improve their standing among their peers). Human needs are not animal needs, to end with survival. Here are some starting pointers: http://usuncut.com/politics/6-common-welfare-myths-we-all-need-to-stop-believing/ http://usuncut.com/politics/6-common-welfare-myths-we-all-ne...
- randallsquared 10y ago
  > People willingly paying for a good means they are happy with the purchase Humans are not homo economicus, and are perfectly capable of feeling unhappy while taking the best option they see, and even being less happy after a voluntary purchase than they were before it. If people feel unhappy after the purchase often enough, some will eventually stop buying the product, and for some of those, no amount of price drop will later convince them to buy again. Even if there are still enough buyers to buy all of the honey, the loss of goodwill in the community due to the appearance of being willing to extract as much value as possible from each transaction (known colloquially as "gouging") may well raise costs for the honey producer in many other interactions with his community, both financial and other. That goodwill is often worth more to the seller than the maximum additional profit that could be generated by raising the price to the market limit.
- coldtea 10y ago
  Those are economics for robots -- the naive, perfect, psychology-free version that applies to game-theory state-machines but rarely to actual humans. A lot of those notions have been debunked for half a century or so in economics papers, but the crude theory is still taught to kids and economics 101 programs for fresh students.
- prodmerc 10y ago
  That's exactly "ruthless capitalism"...
- Terr_ 10y ago
  It may be hard to quantify into a pure-economics framework, but people and companies do place some kind of value on "stable and predictable relationships", even if that relationship is simply the price quoted by a supplier to customers. Mindlessly changing prices for the maximum short-term economic benefit isn't always a winning strategy.
michaelvoz 10y ago
I have to agree with you. Having been in that position, sometimes its better to just run out and be happy with your profit. I've seen situations where a price hike is too severe, and you end up selling less, which causes a smaller profit combined with alienating the very community you support. Perhaps in something with a very long shelf life (honey), but I think, were I in their position, I would do as you say and change nothing.

by igk 10y ago

moron4hire 10y ago

You have it exactly backwards. People willingly paying for a good means they are happy with the purchase, and just as many people will be happy at the higher price if he's still selling out every week. It's not "ruthless capitalism", it's protecting your supply and communicating the correct value. If prices get high enough, it will attract other people to become honey producers, increasing the supply and making more people happy. By keeping prices low, artificial scarcity is created, which is a harm to consumers.

adwn 10y ago
> By keeping prices low, artificial scarcity is created, which is a harm to consumers. No: If a producer can't satisfy demand at his/her prices, then that leaves room for a competitor with higher prices to come in. There, artificial scarcity crisis averted.
- bawana 10y ago
  The problem with most economic theories is that they neglect the phenomenon of entitlement. Since welfare was invented, more and more people find the utility of their choices distorted. They will spend discretionary income on luxury goods and use welfare to obtain the necessities. I find more and more people using their cash to buy cell phones, big screen tv, etc. but they are still unemployed, getting Medicaid as well as disability income sometimes. So the decision to purchase a luxury good (like honey) sometimes does not respond to price hikes as one would expect. Normal users might stop buying it as the price goes up but 'entitled' users may continue buying it and thus they become even more dependent on welfare (and our taxes) for survival.
  - pc86 10y ago
    Where do you live that earned income does not affect welfare income? I make a good living and can't go out and buy a Maserati then say "oh darn I'm out of money, better go grab a welfare check for groceries this week." If someone's buying $20 jars of locally sourced honey they're almost certainly not on welfare.
    - brbsix 10y ago
      Welfare income is not affected by money earned working under the table or selling drugs.
      - coldtea 10y ago
        There are tens of millions of recipients of welfare income. The idea that any statistical significant number of them is selling drugs is so out of touch with reality (and borderline racist, because it draws from minority stereotypes first and foremost) that it's not even funny.
        brbsix 10y ago
        OP wondered in what circumstances people have money for luxury goods yet still qualify for welfare, so I named two. I've come across plenty of people who receive some sort of public aid (e.g. subsidized housing, SNAP, Medi-Cal) who fall in the aforementioned categories. I don't have the slightest clue how representative they are and I don't really care one way or another. Whatever interpretations you make of this are yours alone.
  - coldtea 10y ago
    That's mostly a myth, from observing poor blacks etc sporting expensive sneakers or some large-ass TV, and assuming their spending habits are generally like that. Those "luxury items" are not what the huge majority of welfare spending is about, and welfare is not the reason for them (people which make very little without welfare also splurge for similar purchases -- they serve as compensating factors for the lack of means, and even serve to improve their standing among their peers). Human needs are not animal needs, to end with survival. Here are some starting pointers: http://usuncut.com/politics/6-common-welfare-myths-we-all-need-to-stop-believing/ http://usuncut.com/politics/6-common-welfare-myths-we-all-ne...
randallsquared 10y ago
> People willingly paying for a good means they are happy with the purchase Humans are not homo economicus, and are perfectly capable of feeling unhappy while taking the best option they see, and even being less happy after a voluntary purchase than they were before it. If people feel unhappy after the purchase often enough, some will eventually stop buying the product, and for some of those, no amount of price drop will later convince them to buy again. Even if there are still enough buyers to buy all of the honey, the loss of goodwill in the community due to the appearance of being willing to extract as much value as possible from each transaction (known colloquially as "gouging") may well raise costs for the honey producer in many other interactions with his community, both financial and other. That goodwill is often worth more to the seller than the maximum additional profit that could be generated by raising the price to the market limit.
coldtea 10y ago
Those are economics for robots -- the naive, perfect, psychology-free version that applies to game-theory state-machines but rarely to actual humans. A lot of those notions have been debunked for half a century or so in economics papers, but the crude theory is still taught to kids and economics 101 programs for fresh students.
prodmerc 10y ago
That's exactly "ruthless capitalism"...
Terr_ 10y ago
It may be hard to quantify into a pure-economics framework, but people and companies do place some kind of value on "stable and predictable relationships", even if that relationship is simply the price quoted by a supplier to customers. Mindlessly changing prices for the maximum short-term economic benefit isn't always a winning strategy.

michaelvoz 10y ago

I have to agree with you. Having been in that position, sometimes its better to just run out and be happy with your profit. I've seen situations where a price hike is too severe, and you end up selling less, which causes a smaller profit combined with alienating the very community you support. Perhaps in something with a very long shelf life (honey), but I think, were I in their position, I would do as you say and change nothing.