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> You say "overpay" but if the user pays for it then that would have been an efficient price This says nothing of the possibility that one party has a lot of i
by freyir 9y ago
> You say "overpay" but if the user pays for it then that would have been an efficient price
This says nothing of the possibility that one party has a lot of information, and the other party has relatively little information, and the guy with very little information is getting screwed.
- AndrewKemendo 9y agoThe implicit assumption is that the service is charging your air fare or whatever based on your ability to pay. So in that sense, in aggregate, it drives equilibrium between supply and demand - and thus is comprised of market clearing prices, as I said.
- deleted 9y ago[deleted]
- smallnamespace 9y agoMarket clearing prices can strongly favor one party or another, depending on the information asymmetries present.
- acover 9y agoThere is a difference between competitive single price and monopolistic pricing.