5 ms·

> Not personal convenience, but personal benefit You're right, personal benefit is a factor too, so I replaced "Convenience" with "Utility" which is more apt a

by omeid2 8y ago

> Not personal convenience, but personal benefit You're right, personal benefit is a factor too, so I replaced "Convenience" with "Utility" which is more apt and covers both Convenience and Benefit. > It is true that these problems are unavoidable in a free market. However, outside intervention does not, in general, solve them. Not convinced. For example, in Australia there exists laws that mandates that retailers either exchange or refund when products are "not fit for purpose" or "faulty", this simple law has eliminated a whole heap of bullshit products that doesn't work because people simply return them.

AnthonyMouse 8y ago
> For example, in Australia there exists laws that mandates that retailers either exchange or refund when products are "not fit for purpose" or "faulty", this simple law has eliminated a whole heap of bullshit products that doesn't work because people simply return them. Consider the trade off you're making. Without that law, some retailers will have more generous return policies than others, and the first group will have higher prices (because the policy costs them money). If you prefer that, you patronize one of those retailers, and they don't carry those products because they don't want the returns. But once you pass the law, the second category of retailers goes away. And they had lower prices, even for the items that weren't garbage.
- KozmoNau7 8y ago
  In your example, the cheap retailers are subsidizing the price of the quality products with the ill-gotten gains from selling the crap products to less-informed customers. Those customers unwittingly waste their money, so that others can buy slightly cheaper products. The completely free market does not work in practice, because people are not rational, perfectly informed actors. They make non-optimal choices and tend to not learn from them, and they're easily swayed by advertising. Sensible warranty and returns laws exist because businesses have gotten away with providing lousy quality products for far too long. And consider the longer term effect of sensible consumer protection laws. If a product gets returned too frequently due to quality issues, the seller will stop carrying that item, improving the overall quality of his selection of goods on offer. The manufacturer will wise up and either improve quality or go out of business. In the EU, any online purchase can be returned no questions asked (in like new condition and original packaging) for 14 days after receiving the item, though you do have to pay the return shipping costs. This has markedly improved the quality of items on offer, because the sellers don't want to carry items that get returned too often, ie. crap products. Prices haven't gone up.
  - edanm 8y ago
    > The completely free market does not work in practice, because people are not rational, perfectly informed actors. They make non-optimal choices and tend to not learn from them, and they're easily swayed by advertising. I mean, I agree with being being irrational, but I'm not sure that that's the reason that free markets don't work. If you're comparing to government intervention, then you're also comparing to people, after all, and even worse, to people who often make a less-informed decision, because: 1. They're not as personally aware of all the relevant info, since they are removed from the situation. 2. They often care less in general because it doesn't affect them. 3. They often make decisions that tend to stick around long after they are no longer relevant - but unlike biased humans who often don't learn from their mistakes, these actors' mistakes are written into law and can't be changed. 4. They often have different motivations than the irrational people they are supposedly helping. (Of course, 4 is often the whole point - we as a society have different desires than individual people, and we sometimes want to enshrine those things, even at their expense.) The only way you're doing better than individual actors is if you're assuming the people creating the laws/regulations are better informed/better educated/smarter or for some other reason can make better decisions (which obviously is sometimes true, but sometimes not). The main places where "government" provides value, in my opinion, are where there are market failures, or where collective action gives a lot of benefit. And of course, that's assuming a lot of basics are met, like strong rule of law, police force, etc (these could themselves be thought of as collective action).
    - pdonis 8y ago
      > The main places where "government" provides value, in my opinion, are where there are market failures, or where collective action gives a lot of benefit. Unfortunately, even in cases where there is a lot of theoretical benefit to collective action, government intervention rarely, if ever, realizes that benefit--for exactly the reasons #1 through #4 that you give. I like to use in this context a paraphrase of the old joke about regular expressions: Some people, whenever they see a problem, think "We'll just get the government to fix it." Now they have two problems.
  - AnthonyMouse 8y ago

by omeid2 8y ago

AnthonyMouse 8y ago

> For example, in Australia there exists laws that mandates that retailers either exchange or refund when products are "not fit for purpose" or "faulty", this simple law has eliminated a whole heap of bullshit products that doesn't work because people simply return them. Consider the trade off you're making. Without that law, some retailers will have more generous return policies than others, and the first group will have higher prices (because the policy costs them money). If you prefer that, you patronize one of those retailers, and they don't carry those products because they don't want the returns. But once you pass the law, the second category of retailers goes away. And they had lower prices, even for the items that weren't garbage.

KozmoNau7 8y ago
In your example, the cheap retailers are subsidizing the price of the quality products with the ill-gotten gains from selling the crap products to less-informed customers. Those customers unwittingly waste their money, so that others can buy slightly cheaper products. The completely free market does not work in practice, because people are not rational, perfectly informed actors. They make non-optimal choices and tend to not learn from them, and they're easily swayed by advertising. Sensible warranty and returns laws exist because businesses have gotten away with providing lousy quality products for far too long. And consider the longer term effect of sensible consumer protection laws. If a product gets returned too frequently due to quality issues, the seller will stop carrying that item, improving the overall quality of his selection of goods on offer. The manufacturer will wise up and either improve quality or go out of business. In the EU, any online purchase can be returned no questions asked (in like new condition and original packaging) for 14 days after receiving the item, though you do have to pay the return shipping costs. This has markedly improved the quality of items on offer, because the sellers don't want to carry items that get returned too often, ie. crap products. Prices haven't gone up.
- edanm 8y ago
  > The completely free market does not work in practice, because people are not rational, perfectly informed actors. They make non-optimal choices and tend to not learn from them, and they're easily swayed by advertising. I mean, I agree with being being irrational, but I'm not sure that that's the reason that free markets don't work. If you're comparing to government intervention, then you're also comparing to people, after all, and even worse, to people who often make a less-informed decision, because: 1. They're not as personally aware of all the relevant info, since they are removed from the situation. 2. They often care less in general because it doesn't affect them. 3. They often make decisions that tend to stick around long after they are no longer relevant - but unlike biased humans who often don't learn from their mistakes, these actors' mistakes are written into law and can't be changed. 4. They often have different motivations than the irrational people they are supposedly helping. (Of course, 4 is often the whole point - we as a society have different desires than individual people, and we sometimes want to enshrine those things, even at their expense.) The only way you're doing better than individual actors is if you're assuming the people creating the laws/regulations are better informed/better educated/smarter or for some other reason can make better decisions (which obviously is sometimes true, but sometimes not). The main places where "government" provides value, in my opinion, are where there are market failures, or where collective action gives a lot of benefit. And of course, that's assuming a lot of basics are met, like strong rule of law, police force, etc (these could themselves be thought of as collective action).
  - pdonis 8y ago
    > The main places where "government" provides value, in my opinion, are where there are market failures, or where collective action gives a lot of benefit. Unfortunately, even in cases where there is a lot of theoretical benefit to collective action, government intervention rarely, if ever, realizes that benefit--for exactly the reasons #1 through #4 that you give. I like to use in this context a paraphrase of the old joke about regular expressions: Some people, whenever they see a problem, think "We'll just get the government to fix it." Now they have two problems.
- AnthonyMouse 8y ago