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If they had allowed dynamic pricing then people who needed more would probably be willing to pay $10/roll of paper towels Vs the fixed $2/roll. They aren’t nece

If they had allowed dynamic pricing then people who needed more would probably be willing to pay $10/roll of paper towels Vs the fixed $2/roll. They aren’t necessary for life, so setting fixed prices are why they need hard limits. Seems crazy to me we aren’t seeing a “free market” at play, where both inherently the stores “win” and the people receive the goods they need / can justify.

coffeefirst 7y ago
It's weird how in that scenario software engineers and lawyers always seem to "need" paper towels a lot more than laid off waiters do. It's as if there's something going on there that this reductionist model didn't account for.
- Kaiyou 7y ago
  If someone has to go without it, why can't it be poor people? Seems crazy to leave money on the table.
someguydave 7y ago
You aren't seeing a "free market" because all of these big corps are scared to death of being accused of "profiteering" on supplies (with potential liability from anti-"gouging" laws), so they can't raise prices. Their only other option is to restrict the buyer's quantities.
- perl4ever 7y ago
  They can raise prices moderately on everything to make up for it, and/or stock things that are slightly less appealing in normal times to slow turnover and bias sales towards those more in need. For instance, the pasta section was about 5% full and almost entirely things like whole wheat, cauliflower gluten-free, or turmeric. But that's fine with me. Your tone is that this is not the optimal solution and some misguided people are causing it by mistake. I don't think that's the case. People who get upset about the lack of high prices for scarce commodities seem to me to be inconsistent - if you aren't in a high stakes zero-sum competition, then why should you care much about being able to outbid others? And if you think that you are, how can you ethically defend everyone not getting a minimum ration or be sure that in a so-called free market you will get yours?
  - sokoloff 7y ago
    I think the core belief is that supply and demand is a force that can actually cause more supply to come into a market where there is imbalance. IOW: rather than curtail the expression of demand via rationing, actually increase the supply. If the marginal profit on TP is $0.10/roll and the price is not allowed to increase in time of excess demand, you’re likely to see factories optimize to squeeze every efficiency out, trying to eek out another penny per pack of 6 rolls. Imagine instead a world where prices rise in times of excess demand. Producers now have an incentive to maintain flexibility in monthly production, not squeezing the last fractional penny out and instead allowing flex to over-produce when demand is high (and prices/marginal profit is higher). Likewise, warehouse and distribution adapts to capitalize on high prices, using those high prices as a signal to get more goods to flow to those demanding the goods. In other words, more toilet paper is available for people who want toilet paper. Instead of today’s world where I have to shop twice a week instead of once, or can’t add a more vulnerable neighbor’s shopping to my own, because we are limited to how many eggs I can buy in a single trip. How does that help anyone’s health?
    - someguydave 7y ago
      Agreed. It’s deeply scary to me that it this stuff isn’t intuitively obvious to people who have lived in a free market economy their entire lives. The idea that a Soviet bread line is the most “ethical” way to distribute goods is madness.
    - perl4ever 7y ago
      "I think the core belief is that supply and demand is a force that can actually cause more supply to come into a market" Everybody believes that, in general. But in the short term, the elasticity of supply with respect to price approaches zero. If we ramped up production though, it would be too late, and then there would be a glut.
      - someguydave 7y ago
        How about we let the suppliers and buyers figure that out, rather than having the government get between them with restrictions on how they can contract?
jrumbut 7y ago
We will all suffer if masks and basic hygiene products aren't allocated well. There is not enough time to solve the coordination problem (or, more accurately, we solved it in advance). The government elected by most market participants steps in (or threatens to step in) to help maintain order. This seems like a less crazy idea than seeing how many nurses will pay $500 for a mask.
- CryptoPunk 7y ago
  Market participants are unable to deliberate on every policy position of every candidate that they have to choose from in elections. Elections as currently administered are highly limited in their ability to produce good collective judgments, so the fact that politicians support sonething is no indication that it's socially beneficial. If the democratic process produced socially optimal governance decisions, no democracy on Earth would institute rent control for example, and we see the opposite in practice. And yes, if the shortage for masks is so severe, that they would fetch $500 in a free market, we need prices to spike that high, to spur massive rapid restructuring of the economy to ramp production of masks and alleviate that shortage. Capping the price doesn't solve the fundamental problem, which is the shortage. It interferes with the process of solving the shortage.
  - jrumbut 7y ago
    The non-market solution doesn't solve the fundamental problem it prevents the problem from doing maximal damage in a time sensitive situation. It takes time to build and staff and supply a mask factory, meanwhile you risk the scarce (in the best of times), skilled clinicians getting sick en masse or abandoning their jobs. Market solutions work when there is no coercion besides price, unfortunately viruses won't take checks, nor will people who are fearful or desperate.
    - CryptoPunk 7y ago
      That kind of extreme situation can be dealt with far more targeted regulatory responses than price controls, like simply commandeering private supplies when medical professionals need them during a critical shortage, and some monopolist is refusing to sell them. And in most situations, money can solve the problem, and get the essential item in the hands of those who need them. Those with stockpiles typically have them in order to sell them during a shortage. Not pointlessly hoard them and forego the profit earning opportunity. The long-term damage of anti-price-gouging laws is fewer stockpiles to prevent shortages from emerging during future crises, and a slower ramp up of production and distribution when a shortage does emerge.
perl4ever 7y ago
A grocery store is a "market" and yet it never has been and never will be a "free market" in the idealized sense. You know, everybody knows, that it isn't some sort of free-for-all with product placement on the shelves, right? The store is competing with other stores, but the management determines what to do within the store without either voting or unregulated competition.

coffeefirst 7y ago

It's weird how in that scenario software engineers and lawyers always seem to "need" paper towels a lot more than laid off waiters do. It's as if there's something going on there that this reductionist model didn't account for.

Kaiyou 7y ago
If someone has to go without it, why can't it be poor people? Seems crazy to leave money on the table.

someguydave 7y ago

You aren't seeing a "free market" because all of these big corps are scared to death of being accused of "profiteering" on supplies (with potential liability from anti-"gouging" laws), so they can't raise prices. Their only other option is to restrict the buyer's quantities.

perl4ever 7y ago
They can raise prices moderately on everything to make up for it, and/or stock things that are slightly less appealing in normal times to slow turnover and bias sales towards those more in need. For instance, the pasta section was about 5% full and almost entirely things like whole wheat, cauliflower gluten-free, or turmeric. But that's fine with me. Your tone is that this is not the optimal solution and some misguided people are causing it by mistake. I don't think that's the case. People who get upset about the lack of high prices for scarce commodities seem to me to be inconsistent - if you aren't in a high stakes zero-sum competition, then why should you care much about being able to outbid others? And if you think that you are, how can you ethically defend everyone not getting a minimum ration or be sure that in a so-called free market you will get yours?
- sokoloff 7y ago
  I think the core belief is that supply and demand is a force that can actually cause more supply to come into a market where there is imbalance. IOW: rather than curtail the expression of demand via rationing, actually increase the supply. If the marginal profit on TP is $0.10/roll and the price is not allowed to increase in time of excess demand, you’re likely to see factories optimize to squeeze every efficiency out, trying to eek out another penny per pack of 6 rolls. Imagine instead a world where prices rise in times of excess demand. Producers now have an incentive to maintain flexibility in monthly production, not squeezing the last fractional penny out and instead allowing flex to over-produce when demand is high (and prices/marginal profit is higher). Likewise, warehouse and distribution adapts to capitalize on high prices, using those high prices as a signal to get more goods to flow to those demanding the goods. In other words, more toilet paper is available for people who want toilet paper. Instead of today’s world where I have to shop twice a week instead of once, or can’t add a more vulnerable neighbor’s shopping to my own, because we are limited to how many eggs I can buy in a single trip. How does that help anyone’s health?
  - someguydave 7y ago
    Agreed. It’s deeply scary to me that it this stuff isn’t intuitively obvious to people who have lived in a free market economy their entire lives. The idea that a Soviet bread line is the most “ethical” way to distribute goods is madness.
  - perl4ever 7y ago
    "I think the core belief is that supply and demand is a force that can actually cause more supply to come into a market" Everybody believes that, in general. But in the short term, the elasticity of supply with respect to price approaches zero. If we ramped up production though, it would be too late, and then there would be a glut.
    - someguydave 7y ago
      How about we let the suppliers and buyers figure that out, rather than having the government get between them with restrictions on how they can contract?

jrumbut 7y ago

We will all suffer if masks and basic hygiene products aren't allocated well. There is not enough time to solve the coordination problem (or, more accurately, we solved it in advance). The government elected by most market participants steps in (or threatens to step in) to help maintain order. This seems like a less crazy idea than seeing how many nurses will pay $500 for a mask.

CryptoPunk 7y ago
Market participants are unable to deliberate on every policy position of every candidate that they have to choose from in elections. Elections as currently administered are highly limited in their ability to produce good collective judgments, so the fact that politicians support sonething is no indication that it's socially beneficial. If the democratic process produced socially optimal governance decisions, no democracy on Earth would institute rent control for example, and we see the opposite in practice. And yes, if the shortage for masks is so severe, that they would fetch $500 in a free market, we need prices to spike that high, to spur massive rapid restructuring of the economy to ramp production of masks and alleviate that shortage. Capping the price doesn't solve the fundamental problem, which is the shortage. It interferes with the process of solving the shortage.
- jrumbut 7y ago
  The non-market solution doesn't solve the fundamental problem it prevents the problem from doing maximal damage in a time sensitive situation. It takes time to build and staff and supply a mask factory, meanwhile you risk the scarce (in the best of times), skilled clinicians getting sick en masse or abandoning their jobs. Market solutions work when there is no coercion besides price, unfortunately viruses won't take checks, nor will people who are fearful or desperate.
  - CryptoPunk 7y ago
    That kind of extreme situation can be dealt with far more targeted regulatory responses than price controls, like simply commandeering private supplies when medical professionals need them during a critical shortage, and some monopolist is refusing to sell them. And in most situations, money can solve the problem, and get the essential item in the hands of those who need them. Those with stockpiles typically have them in order to sell them during a shortage. Not pointlessly hoard them and forego the profit earning opportunity. The long-term damage of anti-price-gouging laws is fewer stockpiles to prevent shortages from emerging during future crises, and a slower ramp up of production and distribution when a shortage does emerge.

perl4ever 7y ago

A grocery store is a "market" and yet it never has been and never will be a "free market" in the idealized sense. You know, everybody knows, that it isn't some sort of free-for-all with product placement on the shelves, right? The store is competing with other stores, but the management determines what to do within the store without either voting or unregulated competition.