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Disincentivizes people buying at brick & mortar and selling on eBay.
by foogazi 7y ago
Disincentivizes people buying at brick & mortar and selling on eBay.
- H8crilA 7y agoIf someone buys the increased price it obviously means they couldn't find it in brick and mortar. Also the world supply is short and no amount of lawmaking will materialize more masks. There's not enough masks for everyone and there won't be any time (very) soon, plain and simple. It takes a factory, not a lawmaker to increase the supply.
- jbay808 7y agoThey might not have been able to find it at the brick and mortar because their neighbour bought out all the stock to sell on eBay. Brick and mortar stores generally won't raise prices under these circumstances despite the scarcity, because it might create a long term negative reputation even if they can get a bit more profit in the short term. So there's an opportunity for arbitrage that eBay no longer facilitates.
- DuskStar 7y agoRight - instead they just get a reputation for not having items in stock when you really need them.
- npunt 7y agoI think you're missing the point - if there's a big arbitrage opportunity through price gouging, there will be even less stock in stores.
- DuskStar 7y agoNo, my point is that if the stores raised prices they wouldn't be cleared out for arbitrage or hoarding. You seem to think it's possible to eliminate all resale markets, and thus eliminate the arbitrage opportunity. Ignoring the fact that hoarding would still exist, I would say such a thing is essentially impossible. Which makes the only way to eliminate the price difference (supply and demand curves held static) to have the store raise prices.
- hdjejdjd 7y agoLife isn't a textbook example. People like you are so intellectually boring, like you don't have the curiosity to have figured out the mankiw isn't reality. You have an answer for everything and understand nothing.
- DuskStar 7y agoI'm sorry, what? Do you have a response, or only ad hominem attacks?
- anigbrowl 7y agoAn understanding of the difference between simplistic textbook examples with a lot of constraints, and the real world. Please, read some scholarly economics papers, not just textbooks or ideological treatises. Actual economists are acutely aware of the messiness of the real world, the imperfection of their models, and the complexity of feedback loops and multi-agent interactions.
- DuskStar 7y agoI think I need to repeat this: I'm sorry, what? Do you have a response, or only ad hominem attacks?
- anigbrowl 7y agoIf you do, then it's because you are choosing to posture. There were no ad hominem attacks in my post, but an explanation of what was missing from your perspective and exhortation to broaden it with some specific suggestions.
- DuskStar 7y agoYour suggestion was "read a few papers". Not "this part of what you're saying is wrong, and why", not "look at this paper that makes X argument", not anything of that sort - just "only someone who doesn't understand anything could possibly think that, so I won't rebut anything". Incidentally, I think the consensus among economists that price gouging laws are bad is pretty strong, so I'm not even sure what sources you're suggesting I read. Econlib [0] has a piece on this, particularly on a survey of economists done by the University of Chicago Booth School. I'd expect their opinions on banning resale to be similar. 0: https://www.econlib.org/archives/2017/09/a_poll_of_econo.html https://www.econlib.org/archives/2017/09/a_poll_of_econo.htm...
- jbay808 7y agoYou're not wrong. But the people in charge of the retail stores are not being irrational about this. They know what will cause their reputation to take a hit, and what won't.
- DuskStar 7y agoAlso possible that they know what will cause the eyes of the government to turn in their direction - anyone price gouging in a crisis must be evil, after all. And of course the first store to start doing this will get media attention, amplifying the negative impacts...
- oblio 7y ago> Also possible that they know what will cause the eyes of the government to turn in their direction - anyone price gouging in a crisis must be evil, after all. And of course the first store to start doing this will get media attention, amplifying the negative impacts... I'm guessing you're trying to be snarky with this bit? > anyone price gouging in a crisis must be evil, after all That's kind of text definition of "evil". Taking advantage of people panicking. Pragmatic, probably rich by the end of the thing, but still evil.
- DuskStar 7y agoI think following supply and demand curves - whether that be Uber's surge pricing, gasoline during a power outage, lifesaving medicine outside of a crisis, or rent in SF - isn't evil. Evil would be denying those goods to someone based on their race/gender/age. Or taking action to prevent more of the good from being made/delivered - which you might notice anti-price-gouging laws do.
- godzillabrennus 7y agoFactory eh? Would be nice if America had some of those right now.
- H8crilA 7y agoI totally agree that going too deep into globalization creates tail risks. Switzerland has very high tariffs on many foodstuffs for this very reason. They literally don't care if you bring in 50kg of gold into the country without telling anything to the authorities. But try bringing in 50kg of meat without a valid customs declaration, the cops will be quite angry. You can't eat money.
- foogazi 7y ago> There's not enough masks for everyone and there won't be any time (very) soon, plain and simple. Actually, the high prices on eBay should incentivize mask makers to produce more for the general public. In a pandemic panic scenario the perceived value of an individual mask increases. This is where capitalism should shine
- TheSpiceIsLife 7y agoIf you own a mass manufacturing facility you’d typically want to run it 24/7. There may not be any spare capacity, and new facilities take time to build.
- anigbrowl 7y agoNo way my dude, you just spin up a new Docker instance on AWS and do another funding round in the afternoon. [Giant sarcasm alert]
- TheSpiceIsLife 7y agoMight as well throw in some AI keywords and a story about how we stumbled upon the solution by accident.
- RealStickman 7y agoDon't forget to use Blockchain
- anigbrowl 7y agoGreat suggestions! I've incorporated them into my next podcast, exclusively available to my Platinum Patrons (tm)
- neurostimulant 7y agoIn my country (Indonesia) masks and hand sanitizers have disappeared from all brick and mortar stores (medical equipment stores, drug stores, convenience stores, everywhere you normally can buy them) because speculators are reselling them online for 20x the price. The police has been cracking down on it but seemingly has no effect on availability just yet.
- gruez 7y agoAnd why is that a bad thing? A mask would have much greater utility in a west coast city than in some rural town in the midwest.
- scruffyherder 7y agoand fulfilling market demand is a bad thing? Some of us don't have access to said 'brick and mortar' as it's on a different continent.
- pgt 7y ago...and incentivising brick & mortar to raise prices? This is such a bad idea. The solution to price-gouging is a free market - not closing the market.
- falcrist 7y agoRetail establishments don't usually gouge nearly as deep as eBay sellers. Also, the free market is why price gouging exists. It's a natural consequence of supply and demand coupled with speculation. The only solution the free market offers is that people don't support price gouging via resellers... Which is what eBay is avoiding doing.