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To me, the question still stands: if people refuse to pay more for the service, then in what sense is there a shortage of the service? Can you expand on what y
by zazen 8y ago
To me, the question still stands: if people refuse to pay more for the service, then in what sense is there a shortage of the service?
Can you expand on what you mean by "supply side economics breaking down"?
- aaomidi 8y agoA lot of trucks are owner operated. They can't afford to not work - even though they know they will be able to potentially make more money. Owning a truck is a lot of maintenance - insurance, parking costs, etc. A lot of owners also have to pay lease, loans, etc. They can't afford to negotiate for better rates. Just because there isn't a lot of supply doesn't mean that rates go up!
- zazen 8y agoI can see that small businesses aren't in a great position to negotiate with large businesses. But if there were really a substantial shortage, you wouldn't have to engage in high-risk, high-stakes negotiation to get a better rate. People will offer you a higher rate to secure your service, if your service is _really_ in short supply. If the people hiring these independent trucks can afford not to pay more, because they know someone else will take the lower rate, then there isn't a shortage. This could just about be the definition of whether or not there is a "shortage".