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In a well functioning capitalist economy prices should constantly decrease. The workaround is to get so large, that only the government could possibly compete
by mensetmanusman 3y ago
In a well functioning capitalist economy prices should constantly decrease.
The workaround is to get so large, that only the government could possibly compete with you, then you control prices.
- kalupa 3y agowait, so there's no profit in capitalism?
- erellsworth 3y agoIn a perfectly competitive market, yes, profits go to zero. https://www.investopedia.com/ask/answers/031815/why-are-there-no-profits-perfectly-competitive-market.asp https://www.investopedia.com/ask/answers/031815/why-are-ther... But there's no such thing as a perfectly competitive market.
- charcircuit 3y agoWhy would someone bother selling something if there was no profit to be made?
- pjmorris 3y agoOne example: A farmer might choose to sell his produce at cost so it won't rot, so he can pay his bills and so the surrounding population can eat. A profit would be nice, but there's more to it than profit, e.g. paying the bills and social stability.
- cy_hauser 3y agoTo spin the wheels. People still get paid and the economy keeps humming along. No profit doesn't mean people aren't making money, just that the company isn't making excess money.
- deleted 3y ago[deleted]
- jmopp 3y ago"Oh, what am I to do with all this wheat that grew on my field?"
- jmopp 3y agoAnd then you exclaim that it's the fault of what little regulation there is that's keeping the prices up, and that the prices will drop as soon as the government allows us to pay below minimum wage/hire children/loosen health-and-safety regulations.
- some_random 3y agoI guess this might be true if all goods are commodities but if you look at the details pretty much all goods aren't. If you make a pair of shoes that lasts twice as long and looks twice as good, you can charge twice the price and people will happily buy it and that's a good thing.
- NotYourLawyer 3y agoPrices in real terms should decrease maybe. It’s fine if the numbers go up each year in line with intentional inflation targets.
- JumpCrisscross 3y ago> well functioning capitalist economy prices should constantly decrease Most things an average American would buy in 1923 are cheaper now in real terms. We just have more categories of things we purchase.
- Detrytus 3y agoYes, most things are cheaper, except those tiny, insignificant ones, like houses, college tuition, medical bills...
- sokoloff 3y agoIt's true that there was a lot less money spent on medical bills in 1923. I'm also quite sure that I don't want to go back to 1923 medicine (or even 1923 housing; despite the bones of my house being approximately that old, the 2023 version has vastly nicer lighting, insulation, HVAC, and kitchens/baths).
- JumpCrisscross 3y ago> like houses, college tuition, medical bills These three areas of our economy are broken. Granted. But they also illustrate my point. 1920s tenements, education standards (most people didn’t go to college) and medical practices (most people didn’t have an annual physical) were objectively inferior to our standards today. Prices went up. But so did what and how much we’re consuming.