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It hurts consumers. If you had two gas stations next to each other and they can see each other's signs their pricing will not be competitive because of tacit co

by wbl 3y ago

It hurts consumers. If you had two gas stations next to each other and they can see each other's signs their pricing will not be competitive because of tacit collusion vs if they can't see the price but consumers can.

aspenmayer 3y ago
I don't follow your reasoning here. Collusion to me implies preferential pricing, exclusionary terms of purchase or sale, or formal or informal agreements between separate businesses or their representatives or agents. Furthermore, I don't even know how you'd go about eliminating this practice if you tried. Secret shoppers have always existed and likely will always exist. I'm also reminded of sites and apps which offer shoppers incentives to scan and share their receipts, which is another way which this information could be gathered, not to mention enlisting the help of intermediaries such as Instacart, Uber Eats, and others. To your point, I would agree with your unstated belief that collusion and price fixing are objectively bad for consumers. I'm just not seeing price fixing or collusion occurring in your example or in the situations raised by the original post. The potential for such is definitely there, but performing market research and using such insights to guide pricing decisions is not going away. I don't even see a rational basis for why consumers should want it to go away, but it definitely is the thin edge of the wedge and a slippery slope.
- mattmaroon 3y ago
  It doesn’t make sense at all. Competition makes prices go down. I don’t know how anyone could even imagine the opposite. It’s funny, some of these comments are complaining that being able to see the competition’s prices makes them go up, and some are complaining that it makes them go down, because then the smaller less-efficient businesses that somehow magically have lower prices can’t compete. Perhaps mom and Pop stores have been gone for so long that people don’t remember how high their prices were and why big box retail was able to crush them. None of these objections make any sense at all. People seem to have almost no thoughts in their head these days beyond simply assuming that anything a big business does is bad.
mattmaroon 3y ago
That’s not what happens at all. What happens is when customers can see two gas station price signs at once, the prices go down because each competes. The gas stations that don’t have another one near them have higher prices. Everyone can see everyone else’s prices, it’s public info, it’s just a question of the amount of human labor involved. Automating it doesn’t change the result. Walmart sends humans into local target stores to price compare and vice versa.

by wbl 3y ago

aspenmayer 3y ago

I don't follow your reasoning here. Collusion to me implies preferential pricing, exclusionary terms of purchase or sale, or formal or informal agreements between separate businesses or their representatives or agents. Furthermore, I don't even know how you'd go about eliminating this practice if you tried. Secret shoppers have always existed and likely will always exist. I'm also reminded of sites and apps which offer shoppers incentives to scan and share their receipts, which is another way which this information could be gathered, not to mention enlisting the help of intermediaries such as Instacart, Uber Eats, and others. To your point, I would agree with your unstated belief that collusion and price fixing are objectively bad for consumers. I'm just not seeing price fixing or collusion occurring in your example or in the situations raised by the original post. The potential for such is definitely there, but performing market research and using such insights to guide pricing decisions is not going away. I don't even see a rational basis for why consumers should want it to go away, but it definitely is the thin edge of the wedge and a slippery slope.

mattmaroon 3y ago
It doesn’t make sense at all. Competition makes prices go down. I don’t know how anyone could even imagine the opposite. It’s funny, some of these comments are complaining that being able to see the competition’s prices makes them go up, and some are complaining that it makes them go down, because then the smaller less-efficient businesses that somehow magically have lower prices can’t compete. Perhaps mom and Pop stores have been gone for so long that people don’t remember how high their prices were and why big box retail was able to crush them. None of these objections make any sense at all. People seem to have almost no thoughts in their head these days beyond simply assuming that anything a big business does is bad.

mattmaroon 3y ago

That’s not what happens at all. What happens is when customers can see two gas station price signs at once, the prices go down because each competes. The gas stations that don’t have another one near them have higher prices. Everyone can see everyone else’s prices, it’s public info, it’s just a question of the amount of human labor involved. Automating it doesn’t change the result. Walmart sends humans into local target stores to price compare and vice versa.