3 ms·

That's not quite accurate. Willingness to Pay indicates the true preferences of people who have money. If you try to take it as a metric of the preferences of

That's not quite accurate. Willingness to Pay indicates the true preferences of people who have money. If you try to take it as a metric of the preferences of society you will get the preferences of individuals weighted by their net worth.

jjoonathan 9y ago
It took me way too long to understand this. I blame the term "value," which in the common sense definition is not weighted according to wealth, but in the economic definition, is. Fudging the distinction is a fantastically pernicious way to sneak the "capitalism is enlightened altruism" assumption into your argument.
KekDemaga 9y ago
If that was true we would have tons of restaurants serving caviar and foie gras and very few serving fast food.
hueving 9y ago
That's not quite accurate, otherwise there wouldn't be a wide variety of things to choose with lower incomes. You forget that the market responds to the total volume of buyers at various levels. There are a lot more people in the 0-150k bracket than the people in the 150k+ bracket and when you count the total spending in dollars by each category as a whole, the first group is significantly more powerful. The most successful companies sell to the masses (McDonald's, Walmart, Google, Facebook). The rich have a much smaller influence on the market than you would like to think.
- nicoburns 9y ago
  The rich surely have influence in proportion to the total amount of wealth that they have. Wealth is unevenly distributed enough (a quick google says top 1% have control of 38% of wealth) for this to be a significant skewing factor away from an ideal market.
- Firadeoclus 9y ago
  That seems to be exactly what Barraketh is saying, "the preferences of individuals weighted by their net worth" The preferences of rich _individuals_ have a much higher influence than those of poor individuals.

3 ms·

That's not quite accurate. Willingness to Pay indicates the true preferences of people who have money. If you try to take it as a metric of the preferences of

by Barraketh 9y ago

jjoonathan 9y ago
It took me way too long to understand this. I blame the term "value," which in the common sense definition is not weighted according to wealth, but in the economic definition, is. Fudging the distinction is a fantastically pernicious way to sneak the "capitalism is enlightened altruism" assumption into your argument.
KekDemaga 9y ago
If that was true we would have tons of restaurants serving caviar and foie gras and very few serving fast food.
hueving 9y ago
That's not quite accurate, otherwise there wouldn't be a wide variety of things to choose with lower incomes. You forget that the market responds to the total volume of buyers at various levels. There are a lot more people in the 0-150k bracket than the people in the 150k+ bracket and when you count the total spending in dollars by each category as a whole, the first group is significantly more powerful. The most successful companies sell to the masses (McDonald's, Walmart, Google, Facebook). The rich have a much smaller influence on the market than you would like to think.
- nicoburns 9y ago
  The rich surely have influence in proportion to the total amount of wealth that they have. Wealth is unevenly distributed enough (a quick google says top 1% have control of 38% of wealth) for this to be a significant skewing factor away from an ideal market.
- Firadeoclus 9y ago
  That seems to be exactly what Barraketh is saying, "the preferences of individuals weighted by their net worth" The preferences of rich _individuals_ have a much higher influence than those of poor individuals.