4 ms·

For commodity products, yes. Luxury goods have never been "well-functioning" markets by the definition you appear to be using.

by jbri 16y ago

_delirium 16y ago
Hence the surprise of many consumers, I believe. They're actually being sold a luxury product, whose price is based a lot on branding/status/etc., but they believe, or want to believe, that they're buying a product whose price is based on the quality/cost of its inputs (and/or design, or manufacturing). So, 2x as expensive headphone is expected to be made out of better components, or constructed with a more expensive method, or something, and people are dismayed when they find that that isn't the case. It is somewhat unfortunate as a consumer that the market has turned out that way, rather than as a more competitive market. It makes shopping for audio equipment a lot more time consuming, because prices don't have much to do with either production cost or quality.
- ximeng 16y ago
  The problem is that the companies producing luxury goods benefit from providing as little information as possible to their customers. It would be better for society if the companies with the most knowledge of how to produce a particular type of good could be incentivised to educate consumers rather than to capture as much consumer surplus as possible with dubious market segmentation partly based on keeping people ignorant. This seems to me why people complain about IP laws. They encourage one type of good behaviour - innovation - but also discourage another type of good behaviour - sharing.
- kahawe 16y ago
  I cannot think of any other market with that much voodoo and obscure "magic" as high end audio equipment or (especially) guitar tube amplifiers. And they make sure to keep their selling arguments to "musicality", "passion" and "emotions" because that is something you can easily sell, it gives you a very unique selling position and is virtually impossible for the customer to measure and compare.
deleted 16y ago
[deleted]

For commodity products, yes. Luxury goods have never been "well-functioning" markets by the definition you appear to be using.

by jbri 16y ago

For commodity products, yes. Luxury goods have never been "well-functioning" markets by the definition you appear to be using.

_delirium 16y ago

Hence the surprise of many consumers, I believe. They're actually being sold a luxury product, whose price is based a lot on branding/status/etc., but they believe, or want to believe, that they're buying a product whose price is based on the quality/cost of its inputs (and/or design, or manufacturing). So, 2x as expensive headphone is expected to be made out of better components, or constructed with a more expensive method, or something, and people are dismayed when they find that that isn't the case. It is somewhat unfortunate as a consumer that the market has turned out that way, rather than as a more competitive market. It makes shopping for audio equipment a lot more time consuming, because prices don't have much to do with either production cost or quality.

ximeng 16y ago
The problem is that the companies producing luxury goods benefit from providing as little information as possible to their customers. It would be better for society if the companies with the most knowledge of how to produce a particular type of good could be incentivised to educate consumers rather than to capture as much consumer surplus as possible with dubious market segmentation partly based on keeping people ignorant. This seems to me why people complain about IP laws. They encourage one type of good behaviour - innovation - but also discourage another type of good behaviour - sharing.
kahawe 16y ago
I cannot think of any other market with that much voodoo and obscure "magic" as high end audio equipment or (especially) guitar tube amplifiers. And they make sure to keep their selling arguments to "musicality", "passion" and "emotions" because that is something you can easily sell, it gives you a very unique selling position and is virtually impossible for the customer to measure and compare.

deleted 16y ago

[deleted]