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I am assuming you never heard of "I'm not rich enough to buy cheap shoes" or some variation of that and this doesn't intuitively make sense for you. And I hope

I am assuming you never heard of "I'm not rich enough to buy cheap shoes" or some variation of that and this doesn't intuitively make sense for you. And I hope this doesn't come off like I'm mansplaining or smartsplaining or whatever :) - Renting in San Francisco and New York. $$$ gets you way bigger and better places than $. It's not thrice the value. It's over 5x the value. This becomes very obvious as you move up the salary ladder. - To plagiarise a Reddit post on this exact topic (which the OP article was plagirising but...) "poor people can't buy in bulk, so they never get to enjoy the savings of Costco" - A whole cow costs less than the sum of the prices of its parts. Same applies to poultry and fish. Vegetables seem to have a linear price to amount ratio but that's largely priced in way earlier so it's kind of an illusion. There is no evil force at work. Simple economics really. - Economics of scale. This probably applies so widely that it's hard to overstate. e.g. Costco, better boot, whole cow. There are fixed costs to transport, customs, maintaining a store, sales people etc. Cheap stuff has to sacrifice quality so you come back more often - frequent enough to help with the fixed costs. - Money today > money tomorrow. Not sure if there is an economic principle behind this because it doesn't always hold, but everyone except banks believe it always holds. Maybe because we believe we can invest it real good, or we enjoy the security of it (unless you're better than banks at collecting and/or selling debt). E.g. rent in SF. It takes longer to find tenants for $$$ apartments. And landlords lose more money when they let $$$ apartments sit empty. So, they can't expect to charge 2x the rent for 2x the square footage. Usually 2x the rent offers >= 2x square footage AND more amenities. Apologies for errors. Had to write this on mobile.

panick21_ 4y ago
Yes but you need to balance these things in the other direction. You are just listing all of the economics of scale, without any of the drawbacks. First of all about shoes. Yes, as I wrote in another post, some % of society can not even afford a decent pair of shoes, but those people should be on welfare. The question is, how do you make a society where this applies to very few people. > - Renting in San Francisco and New York. $$$ gets you way bigger and better places than $. That is questionable, location is the main benefit. Maybe in terms of space. But in terms of getting access to the local job market, local transportation system and access to the local market this isn't the case. > - A whole cow costs less than the sum of the prices of its parts. Yes, but unfortunately I can not store a whole cow in my apartment. Even the poorest people can usually buy a 5kg bag of rice or something like that. Going beyond that and buying a 100kg pack becomes unpractical. The reality is most middle class people don't shop at Costco. Specially in urban places this simply doesn't make sense. Most shopping is done at the closest local store, because that safes on time and money (and for lots of people gas). So the idea that rich people are rich because they can go to Cosco and buy 5 years worth of rice is nonsense. When I go to the shop I'm walking there, in and out and home within 20min flat. Sure if I had a car and if I had the storage space I could drive across town, to the mega store and buy in bulk but that's not actually practical and it also doesn't safe a huge amount of money. I do that once a year for my birthday party. > There is no evil force at work. Simple economics really. Yes but you are ignoring the reverse incentive. The need to own a car. The need for a big fridge and lots big storage space. You need a place to put your car, and society might finance that for you with free street parking (should be abolished) or you need to have a garage. Then you need to heat that space and on and on. And on a society level, you need to build stroads, you need to bring water and other services to those big box stores. You need to have lots and lots of policing for every Walmarket (2 police visits a day on average). Who pays for that? Local property taxes, that guess what you have to pay, and the garage that your car is in has to pay that too. There is a reason that in most cities in the world and historically most people walk to the closest convenient store that is often not owned by the largest cooperation in the world, but rather by some immigrant family. The Soivets built their whole society around micro-districts that had everything that you need in them. And among all the dumb shit they did, that actually did was the cost efficient way of doing things. When you think systematically about what actually cost money and how to account for those costs, and how you can structure a society so that the most amount of people people can live without government welfare, designing a system so that poor people can go to Cosco and buy 3 month worth of grocery to get economics of scale is the exact wrong solution. But that is exactly the pattern of development encouraged and promoted. Instead of complaining about all the individual issues, high taxes, high transportation cost, high housing cost, high cost for utilizes. These are the trees, but the forest here seems to be missed. The real economics of scale are in the density and the accessibility of your urban environment, not in the individual buying choice of each consumer. The idea that poor people are poor because a 50kg bag of rice cheaper per kg, then a 5kg bag of rice is wrong. They are poor because the land use pattern force them (and society) into a long term unhealthy, in-efficient and wasteful form of living. Do you get where I am coming from?

panick21_ 4y ago

Yes but you need to balance these things in the other direction. You are just listing all of the economics of scale, without any of the drawbacks. First of all about shoes. Yes, as I wrote in another post, some % of society can not even afford a decent pair of shoes, but those people should be on welfare. The question is, how do you make a society where this applies to very few people. > - Renting in San Francisco and New York. $$$ gets you way bigger and better places than $. That is questionable, location is the main benefit. Maybe in terms of space. But in terms of getting access to the local job market, local transportation system and access to the local market this isn't the case. > - A whole cow costs less than the sum of the prices of its parts. Yes, but unfortunately I can not store a whole cow in my apartment. Even the poorest people can usually buy a 5kg bag of rice or something like that. Going beyond that and buying a 100kg pack becomes unpractical. The reality is most middle class people don't shop at Costco. Specially in urban places this simply doesn't make sense. Most shopping is done at the closest local store, because that safes on time and money (and for lots of people gas). So the idea that rich people are rich because they can go to Cosco and buy 5 years worth of rice is nonsense. When I go to the shop I'm walking there, in and out and home within 20min flat. Sure if I had a car and if I had the storage space I could drive across town, to the mega store and buy in bulk but that's not actually practical and it also doesn't safe a huge amount of money. I do that once a year for my birthday party. > There is no evil force at work. Simple economics really. Yes but you are ignoring the reverse incentive. The need to own a car. The need for a big fridge and lots big storage space. You need a place to put your car, and society might finance that for you with free street parking (should be abolished) or you need to have a garage. Then you need to heat that space and on and on. And on a society level, you need to build stroads, you need to bring water and other services to those big box stores. You need to have lots and lots of policing for every Walmarket (2 police visits a day on average). Who pays for that? Local property taxes, that guess what you have to pay, and the garage that your car is in has to pay that too. There is a reason that in most cities in the world and historically most people walk to the closest convenient store that is often not owned by the largest cooperation in the world, but rather by some immigrant family. The Soivets built their whole society around micro-districts that had everything that you need in them. And among all the dumb shit they did, that actually did was the cost efficient way of doing things. When you think systematically about what actually cost money and how to account for those costs, and how you can structure a society so that the most amount of people people can live without government welfare, designing a system so that poor people can go to Cosco and buy 3 month worth of grocery to get economics of scale is the exact wrong solution. But that is exactly the pattern of development encouraged and promoted. Instead of complaining about all the individual issues, high taxes, high transportation cost, high housing cost, high cost for utilizes. These are the trees, but the forest here seems to be missed. The real economics of scale are in the density and the accessibility of your urban environment, not in the individual buying choice of each consumer. The idea that poor people are poor because a 50kg bag of rice cheaper per kg, then a 5kg bag of rice is wrong. They are poor because the land use pattern force them (and society) into a long term unhealthy, in-efficient and wasteful form of living. Do you get where I am coming from?