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>Corporations charge more money because people will pay it People pay for it because they don't have a choice. >Change nothing, allowing the first customers t

>Corporations charge more money because people will pay it People pay for it because they don't have a choice. >Change nothing, allowing the first customers to buy everything and leave shelves empty The ridiculous economic rationalization. "Hey everyone, we increased the price by 30% so we keep more on the shelves by pricing out the lower/middle class!" You sound like you are just out of a micro economics class and think everything "has to work this way". What you don't realize is that your ENTIRE MINDSET is viewed on MAXIMIZING PROFITS for that SPECIFIC CORPORATION and not the overall welfare of society. You also assume EVENLY DISTRIBUTED WEALTH if you are disregarding the welfare of society. If I run a donut shop and can produce 100 donuts a day. According to you, the only way to run the business is to charge as much as possible to still sell ~100 donuts so I can make the most profit. What if by selling them at a reasonable price, everyone is able to afford them and we are still able to pay our workers and ourselves well? Gasp! Another solution presents itself which makes the overall society better off. It doesn't have to be about charging as much as possible, where that extra money will just go to the owner and not the workers anyway.

danielmarkbruce 4y ago
>> According to you, the only way to run the business 3 choices were given.
toast0 4y ago
> People pay for it because they don't have a choice. Almost everything has substitutes. I did some construction projects these past years, and because lumber prices are up, there's a lot more metal in my construction. Metal siding and roof for a goat shed, metal studs in new walls. Those were always options I wouldn't have normally chosen. The metal goat shed is likely going to last longer, which is nice, but the metal studs in the wall don't provide a benefit, other than cost/availability. When all the items in the category go up, there's not much substitution to be had, of course.
- giraffe_lady 4y ago
  There's not really a substitute for rice or cooking oil.
  - danielmarkbruce 4y ago
    Pasta and butter? Bread? Fruit? Snickers bars?
    - giraffe_lady 4y ago
      Can you fry an egg in a snickers bar? Ever eat the famous staple food black beans & fruit? Yes I know that other foods exist.
      - danielmarkbruce 4y ago
        Those other foods are substitutes, by definition. Maybe that was sarcasm and I missed it..?
        giraffe_lady 4y ago
        My point is that people don't consume calories they eat meals. The foods people eat, especially staple foods, are important parts of their lives. We can't guarantee every staple be cheap obviously, but a lot of these things are staples in the first place because they are cheap and widely available. If you're eating for example beans and rice as the base of your diet you're already near the bottom of possible prices for sustenance. Sure junk food is cheaper per calorie in the short term, but we don't have public healthcare where I live and you're just signing up to be publicly shamed for your health problems later.
        danielmarkbruce 4y ago
        There is a long history of humans changing their diet in response to economic forces.
- CameronNemo 4y ago
  Lumber is the worst example you can pick because there is so much competition and substitutes. What about the only grocery store within a five mile radius? Do consumers have substitutes then? Maybe Amazon, but whoo boy Amazon sure does have a lot of market power too.
vorpalhex 4y ago
You are the worlds most popular donut shop. People are literally fighting each other in line to get your donuts. For reasons (quality, scale) you can only produce 100 donuts a day. Definitely no more. On an average day, you have 200 potential customers. Busy days, closer to 400. A donut costs you $0.20 to make (incl labor). Do you sell them for $0.20 each and let the first person in the door buy all of your donuts for $20? Do you ration them and let each person only buy one? (Sorry mom! Guess you have to split with the kids.) You have not benefitted anyone! You have made the situation worse. No, you raise the price of your donuts to $5 or so. Some people will buy a couple but most people in the front of the line will get a donut still. This is literally what the super famous donut shop near me does! Buying a dozen donuts from them would be like $60+, but almost everyone can buy a donut or two. Raising prices for a limited commodity when literally not everyone who wants one can get one is the best strategy. > everyone is able to afford them It doesn't matter if all 400 people in line could afford them if the first person in line buys them all!
- andrekandre 4y ago
  > Raising prices for a limited commodity when literally not everyone who wants one can get one is the best strategy. ... > It doesn't matter if all 400 people in line could afford them if the first person in line buys them all! the other solution to raising prices is to limit purchases per customer isn't it? i seem to recall they did this with ps5, and same for iphone in the old days during launch... its not novel idea imo... e.g "limit one dozen donuts per customer" etc
  - danielmarkbruce 4y ago
    Then you get people paying other people to stand in line. It's a thing.
    - andrekandre 4y ago
      so whats the alternative to raising prices... nothing?
makomk 4y ago
It's not ridculous at all, it's the actual tradeoff that has to happen in order for prices not to go up. For example, someone elsewhere in the discussion was complaining about US egg prices - supermarkets here in the UK are extremely competitive and reluctant to raise prices, with the inevitable consequence that our egg prices are still normal but there weren't actually eggs on the shelves most of the time.
dsfyu404ed 4y ago
>People pay for it because they don't have a choice. But that money has to come from somewhere. Money is not infinite from the perspective of any individual actor. If you spend more on gas and 2x4s you have to spend less on something else. Consumer and business credit makes this kind of fuzzy but for the most part it holds. >If I run a donut shop and can produce 100 donuts a day. According to you, the only way to run the business is to charge as much as possible to still sell ~100 donuts so I can make the most profit. What if by selling them at a reasonable price, everyone is able to afford them and we are still able to pay our workers and ourselves well? Gasp! Another solution presents itself which makes the overall society better off. It doesn't have to be about charging as much as possible, where that extra money will just go to the owner and not the workers anyway. What are the margins on this hypothetical donuts shop and what do you do when the price of labor goes up 20%, energy goes up 80% eggs goes up 100%?
- eatsyourtacos 4y ago
  >What are the margins on this hypothetical donuts shop and what do you do when the price of labor goes up 20%, energy goes up 80% eggs goes up 100%? Sure the prices have to increase. But what if they just increased by the amount that it actually cost? And then decreased as those costs go back down? That's the entire discussion here- corporations are increasing by WAY MORE than what the raw inputs cost.. otherwise they would not be making more profits. And then are not proportionality decreasing as their costs go back down.

danielmarkbruce 4y ago

>> According to you, the only way to run the business 3 choices were given.

toast0 4y ago

> People pay for it because they don't have a choice. Almost everything has substitutes. I did some construction projects these past years, and because lumber prices are up, there's a lot more metal in my construction. Metal siding and roof for a goat shed, metal studs in new walls. Those were always options I wouldn't have normally chosen. The metal goat shed is likely going to last longer, which is nice, but the metal studs in the wall don't provide a benefit, other than cost/availability. When all the items in the category go up, there's not much substitution to be had, of course.

giraffe_lady 4y ago
There's not really a substitute for rice or cooking oil.
- danielmarkbruce 4y ago
  Pasta and butter? Bread? Fruit? Snickers bars?
  - giraffe_lady 4y ago
    Can you fry an egg in a snickers bar? Ever eat the famous staple food black beans & fruit? Yes I know that other foods exist.
    - danielmarkbruce 4y ago
      Those other foods are substitutes, by definition. Maybe that was sarcasm and I missed it..?
      - giraffe_lady 4y ago
        My point is that people don't consume calories they eat meals. The foods people eat, especially staple foods, are important parts of their lives. We can't guarantee every staple be cheap obviously, but a lot of these things are staples in the first place because they are cheap and widely available. If you're eating for example beans and rice as the base of your diet you're already near the bottom of possible prices for sustenance. Sure junk food is cheaper per calorie in the short term, but we don't have public healthcare where I live and you're just signing up to be publicly shamed for your health problems later.
        danielmarkbruce 4y ago
        There is a long history of humans changing their diet in response to economic forces.
CameronNemo 4y ago
Lumber is the worst example you can pick because there is so much competition and substitutes. What about the only grocery store within a five mile radius? Do consumers have substitutes then? Maybe Amazon, but whoo boy Amazon sure does have a lot of market power too.

vorpalhex 4y ago

You are the worlds most popular donut shop. People are literally fighting each other in line to get your donuts. For reasons (quality, scale) you can only produce 100 donuts a day. Definitely no more. On an average day, you have 200 potential customers. Busy days, closer to 400. A donut costs you $0.20 to make (incl labor). Do you sell them for $0.20 each and let the first person in the door buy all of your donuts for $20? Do you ration them and let each person only buy one? (Sorry mom! Guess you have to split with the kids.) You have not benefitted anyone! You have made the situation worse. No, you raise the price of your donuts to $5 or so. Some people will buy a couple but most people in the front of the line will get a donut still. This is literally what the super famous donut shop near me does! Buying a dozen donuts from them would be like $60+, but almost everyone can buy a donut or two. Raising prices for a limited commodity when literally not everyone who wants one can get one is the best strategy. > everyone is able to afford them It doesn't matter if all 400 people in line could afford them if the first person in line buys them all!

andrekandre 4y ago
> Raising prices for a limited commodity when literally not everyone who wants one can get one is the best strategy. ... > It doesn't matter if all 400 people in line could afford them if the first person in line buys them all! the other solution to raising prices is to limit purchases per customer isn't it? i seem to recall they did this with ps5, and same for iphone in the old days during launch... its not novel idea imo... e.g "limit one dozen donuts per customer" etc
- danielmarkbruce 4y ago
  Then you get people paying other people to stand in line. It's a thing.
  - andrekandre 4y ago
    so whats the alternative to raising prices... nothing?

makomk 4y ago

It's not ridculous at all, it's the actual tradeoff that has to happen in order for prices not to go up. For example, someone elsewhere in the discussion was complaining about US egg prices - supermarkets here in the UK are extremely competitive and reluctant to raise prices, with the inevitable consequence that our egg prices are still normal but there weren't actually eggs on the shelves most of the time.

dsfyu404ed 4y ago

>People pay for it because they don't have a choice. But that money has to come from somewhere. Money is not infinite from the perspective of any individual actor. If you spend more on gas and 2x4s you have to spend less on something else. Consumer and business credit makes this kind of fuzzy but for the most part it holds. >If I run a donut shop and can produce 100 donuts a day. According to you, the only way to run the business is to charge as much as possible to still sell ~100 donuts so I can make the most profit. What if by selling them at a reasonable price, everyone is able to afford them and we are still able to pay our workers and ourselves well? Gasp! Another solution presents itself which makes the overall society better off. It doesn't have to be about charging as much as possible, where that extra money will just go to the owner and not the workers anyway. What are the margins on this hypothetical donuts shop and what do you do when the price of labor goes up 20%, energy goes up 80% eggs goes up 100%?

eatsyourtacos 4y ago
>What are the margins on this hypothetical donuts shop and what do you do when the price of labor goes up 20%, energy goes up 80% eggs goes up 100%? Sure the prices have to increase. But what if they just increased by the amount that it actually cost? And then decreased as those costs go back down? That's the entire discussion here- corporations are increasing by WAY MORE than what the raw inputs cost.. otherwise they would not be making more profits. And then are not proportionality decreasing as their costs go back down.