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If there is 1000 units of something but demand for 5000 units, you increase the price until demand equals 1000 units. There is no conspiracy. This is fundamenta

If there is 1000 units of something but demand for 5000 units, you increase the price until demand equals 1000 units. There is no conspiracy. This is fundamental economics. “Market-think” is about freedom. The alternative is “authoritarian-think” and that always ends in tears. Just start setting prices by government decree and see what happens.

jay_kyburz 4y ago
In the case where products can be profitably produced at a cheaper price, the people should band together, put aside the market system, and produce all 5000 units. More people are served. If its costs $100 to fly somebody from Sydney to Melbourne and Qantas is selling tickets for $1000, Australians should run an airline and sell tickets for $200. Governments should get into the business of keeping markets competitive.
- makomk 4y ago
  Even in an ideal world where there's no fundamental difference in the cost of producing 1000 units or 5000, companies aren't going to be able to sell 5000 at the same price as they could 1000 when doing so exceeds their current capacity. Expanding that capacity means more staff and equipment, which costs money that has to be paid for somehow. It also takes time, which means that it cannot act as an immediate solution to the cost problem and also that there's substantial risk involved - by the time the extra capacity is there, the demand may not be. In order to justify taking on this risk there needs to be the expectation of substantially higher profits. Also, commercial airlines in particular are an industry with a history of over-optimistic expansion followed by cut-throat competition on pricing and then bankrupcy, and I'm pretty sure everyone in the industry knows this by now which is why there's not a huge rush to expand massively.
  - jay_kyburz 4y ago
    I personally think airline tickets need to be taxed heavily so that travelers pay for every ounce of carbon emitted to be captured.
- gruez 4y ago
  >the people should band together, put aside the market system, and produce all 5000 units. More people are served. You just described a command economy, which have a poor track record historically.
  - jay_kyburz 4y ago
    I didn't suggest government should dictate production levels or prices. I am suggesting governments should consider putting together not-for-profit, but self funding organizations, with fair and reasonable salaries for all employees, to produce good and services for its people. Then you allow the free market to compete against that baseline profitable business. If for profit companies can't produce a better or cheaper product, they should just not exist. Australia's ABC is a good example of what I am talking about. There are commercial offerings, but there is a baseline keeping standards up. Of course gets a lot more complicated when your state sponsored factories can't compete on quality or price and is not selling any widgets at all. At what point do you decide the market is working to your satisfaction and you should shut it down. How much of a loss do you allow? How much is it worth to a country to be able to build x widgets or offer x service? How good would it be if we still had the ability to manufacture things here in Australia? How do you put a dollar value on that?
    - gruez 4y ago
      >I am suggesting governments should consider putting together not-for-profit, but self funding organizations, with fair and reasonable salaries for all employees, to produce good and services for its people. What specifically does this entail? Is the government providing starting capital? Or is it in charge of creating the organization and letting them handle the rest? >If for profit companies can't produce a better or cheaper product, they should just not exist. >Australia's ABC is a good example of what I am talking about. There are commercial offerings, but there is a baseline keeping standards up. According to wikipedia ABC receives more than a billion dollars per year from the government. How can you say with a straight face that companies that can't compete with that "should just not exist"?
      - 4y ago
- Khaine 4y ago
  Government do get into the business of keeping markets competitive. That is one of the drivers for regulation. You will note, Qantas isn't the only domestic airline in Australia. Airlines are also highly capital intensive. It costs a lot of money to own and maintain a plan
naasking 4y ago
> If there is 1000 units of something but demand for 5000 units, Except that's not the case here, both supply and demand for eggs and milk have not changed much, neither have the costs to produce either. That's why prices are skyrocketing and profits are soaring. Look, the data is out there and very clear on this point: https://www.youtube.com/watch?v=udITRL9-t08 https://www.youtube.com/watch?v=udITRL9-t08
- gruez 4y ago
  >both supply and demand for eggs [...] have not changed much https://en.wikipedia.org/wiki/Avian_influenza#United_States_2022%E2%80%9323_outbreak https://en.wikipedia.org/wiki/Avian_influenza#United_States_...
  - naasking 4y ago
    Yes, they euthanized a bunch of chickens, and yet total egg output remained basically the same. So where did the inflation come from? Why are egg producers suddenly recording record profits?
    - gruez 4y ago
      >and yet total egg output remained basically the same source? Also, due to how price elasticity curves work, even if production is "basically" the same, it doesn't necessarily mean that prices would also be "basically" the same. If demand is inelastic, buyers will bid up prices to astronomical levels.

jay_kyburz 4y ago

In the case where products can be profitably produced at a cheaper price, the people should band together, put aside the market system, and produce all 5000 units. More people are served. If its costs $100 to fly somebody from Sydney to Melbourne and Qantas is selling tickets for $1000, Australians should run an airline and sell tickets for $200. Governments should get into the business of keeping markets competitive.

makomk 4y ago
Even in an ideal world where there's no fundamental difference in the cost of producing 1000 units or 5000, companies aren't going to be able to sell 5000 at the same price as they could 1000 when doing so exceeds their current capacity. Expanding that capacity means more staff and equipment, which costs money that has to be paid for somehow. It also takes time, which means that it cannot act as an immediate solution to the cost problem and also that there's substantial risk involved - by the time the extra capacity is there, the demand may not be. In order to justify taking on this risk there needs to be the expectation of substantially higher profits. Also, commercial airlines in particular are an industry with a history of over-optimistic expansion followed by cut-throat competition on pricing and then bankrupcy, and I'm pretty sure everyone in the industry knows this by now which is why there's not a huge rush to expand massively.
- jay_kyburz 4y ago
  I personally think airline tickets need to be taxed heavily so that travelers pay for every ounce of carbon emitted to be captured.
gruez 4y ago
>the people should band together, put aside the market system, and produce all 5000 units. More people are served. You just described a command economy, which have a poor track record historically.
- jay_kyburz 4y ago
  I didn't suggest government should dictate production levels or prices. I am suggesting governments should consider putting together not-for-profit, but self funding organizations, with fair and reasonable salaries for all employees, to produce good and services for its people. Then you allow the free market to compete against that baseline profitable business. If for profit companies can't produce a better or cheaper product, they should just not exist. Australia's ABC is a good example of what I am talking about. There are commercial offerings, but there is a baseline keeping standards up. Of course gets a lot more complicated when your state sponsored factories can't compete on quality or price and is not selling any widgets at all. At what point do you decide the market is working to your satisfaction and you should shut it down. How much of a loss do you allow? How much is it worth to a country to be able to build x widgets or offer x service? How good would it be if we still had the ability to manufacture things here in Australia? How do you put a dollar value on that?
  - gruez 4y ago
    >I am suggesting governments should consider putting together not-for-profit, but self funding organizations, with fair and reasonable salaries for all employees, to produce good and services for its people. What specifically does this entail? Is the government providing starting capital? Or is it in charge of creating the organization and letting them handle the rest? >If for profit companies can't produce a better or cheaper product, they should just not exist. >Australia's ABC is a good example of what I am talking about. There are commercial offerings, but there is a baseline keeping standards up. According to wikipedia ABC receives more than a billion dollars per year from the government. How can you say with a straight face that companies that can't compete with that "should just not exist"?
    - 4y ago
Khaine 4y ago
Government do get into the business of keeping markets competitive. That is one of the drivers for regulation. You will note, Qantas isn't the only domestic airline in Australia. Airlines are also highly capital intensive. It costs a lot of money to own and maintain a plan

naasking 4y ago

> If there is 1000 units of something but demand for 5000 units, Except that's not the case here, both supply and demand for eggs and milk have not changed much, neither have the costs to produce either. That's why prices are skyrocketing and profits are soaring. Look, the data is out there and very clear on this point: https://www.youtube.com/watch?v=udITRL9-t08 https://www.youtube.com/watch?v=udITRL9-t08

gruez 4y ago
>both supply and demand for eggs [...] have not changed much https://en.wikipedia.org/wiki/Avian_influenza#United_States_2022%E2%80%9323_outbreak https://en.wikipedia.org/wiki/Avian_influenza#United_States_...
- naasking 4y ago
  Yes, they euthanized a bunch of chickens, and yet total egg output remained basically the same. So where did the inflation come from? Why are egg producers suddenly recording record profits?
  - gruez 4y ago
    >and yet total egg output remained basically the same source? Also, due to how price elasticity curves work, even if production is "basically" the same, it doesn't necessarily mean that prices would also be "basically" the same. If demand is inelastic, buyers will bid up prices to astronomical levels.