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The problem is that it IS a purely economic problem. It's just math - supply, demand and competition. Small business in particular is captured by these forces.
by listless 5y ago
The problem is that it IS a purely economic problem. It's just math - supply, demand and competition. Small business in particular is captured by these forces. It cannot increase prices because people will go to the competition. And it has no margin to absorb people's desire to earn enough to live a middle-class life doing a job that you can hire anyone to do.
All of that said, what you could reasonably hope would happen is that all businesses raise their prices because of the labor shortage (already happening around me), but then you have another problem which is that the increased wages are offset by the increased prices.
At the current click, all that's going to be left are the corporations with enough wiggle room to absorb the increase, but they will also pass on prices. I would just prefer not to live in that world. I think corporations increase inequity (Walmart could pay a living wage and full health care, but doesn't) and small business puts the power back with the individual.
- Ericson2314 5y agoIt's not just amortized supply and demand. We ask, why don't workers go on general strikes? Well small businesses refusing to even try raising wages and prices amounts to a capital general strike. Employers and employees simply have radically different market power, and that is as fundamental a fact in all economies remotely like ours as any econ 101 supply and demand.
- GoOnThenDoTell 5y agoA lot of people just have habits or preferences for particular shops, regardless of a price premium when prices get raised
- desmosxxx 5y agoand a lot don't. this is all captured by simple supply/demand curves
- 88913527 5y agoEconomics is the junction of mathematics and human behavior. I'm not going to travel half a mile to a different taco shop if the closest to me increases burrito prices $1-2 (in an area that reliably has at least 1 taco shop every half mile). In some sense, I'm a captive audience. I'm hungry and I don't want to walk an additional 15 minutes to save a few dollars.
- josephcsible 5y agoPeople on HN tend to be way less price sensitive than average. People living paycheck-to-paycheck would totally walk an extra 0.5 mile to save $2 per meal.
- shinjitsu 5y agoEspecially families with children- now we are talking $8+ a meal at a time in life when people are very price sensitive.
- edgedetector 5y agoYeah, I regularly do this.
- odshoifsdhfs 5y agoMy girlfriend will walk 30 minutes to save 50c on bananas. She is financially well now, but grew up without much, so those habits still stick. I would pay 5 dollars more to not move from my couch and get bananas on my doorstep. The thing is, a lot more people are like my gf than me (I grew up middle-upper class and am 'financially' well upper class for my country).