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The Market for Lemons rule is that if consumers are unable to recognize quality and crap products while buying, after some time all the products on the market a
by mixedbit 10y ago
The Market for Lemons rule is that if consumers are unable to recognize quality and crap products while buying, after some time all the products on the market are crap.
- razzaj 10y agoI know that thesis. But i find that the middle class usually has a propensity to buying the more expensive items (even if it ends up being only marginally better than crap) because of a different dynamic. and it always puzzled me, i see it as an uninformed, irrationally positive, outlook generated by the mean fact of paying more for a "brand", because "surely it is better".
- vidarh 10y agoBut if the consumer has no way of telling which is better there's no reason for the manufacturers to use quality as the determining factor for setting the price. Instead they'll focus on making it look more expensive or add features you'll never use in order to win market share.
- xg15 10y agoPartially this, plus the monopoly position the post described: Three companies "won" the market and have no pressure to produce anything else then lemons anymore. And since a bad dishwasher is still better than no dishwasher, consumers will buy them even if they know it's crap as long as there is no alternative.