3 ms·

Seems like the market isn't working.

by croes 2y ago

psychlops 2y ago
Cheap gas allows the cars to get bigger. Seems like the market has filled the gap as one might expect?
antimemetics 2y ago
I was thinking exactly that - shouldn’t capitalism regulate this kind of thing on it’s own or something
- xpe 2y ago
  Self-interest strives to break (or break out of) competitive markets to one’s own benefit.
- deleted 2y ago
  [deleted]
- smsm42 2y ago
  The idea that "capitalism" somehow magically makes everybody do exactly what any particular person or set of persons want to happen is fascinating. How could one arrive to such a conclusion? No, that's not how "capitalism" works. It does not guarantee that the things you want to happen magically will happen because "market".
- randomdata 2y ago
  Not when government regulation favours larger vehicles (e.g. lower emission standards).
cranekam 2y ago
It clearly is. As the article makes out, the tax code and regulation favours large vehicles. Gas is cheap. Acting alone, there are few reasons to buy a smaller car if you can afford a bigger one. This is exactly the market “working” and why regulation is necessary to change it.
- imglorp 2y ago
  Gas is artificially cheap, but it's at enormous expense to the global community. The US spent $2T on the gulf wars to secure this, and globally spend at least $7T a year on fossil subsidies. This needs to end immediately. https://www.imf.org/en/Publications/WP/Issues/2023/08/22/IMF-Fossil-Fuel-Subsidies-Data-2023-Update-537281 https://www.imf.org/en/Publications/WP/Issues/2023/08/22/IMF...
- animal_spirits 2y ago
  More rules aren't going to fix the problem that more rules created. We need to reduce the amount of regulation on vehicles, specifically the CAFE regulations which are the driver behind large vehicles, and let the real market forces play out. Whenever governmental regulations get involved, the market forces are distorted to what the regulations incentivize, rather than what the people incentivize.
  - baq 2y ago
    That’s literally the point of regulations and why civilization invented them. You want to get rid of bad regulations, obviously. You really don’t want to get rid of all regulations.
- brendoelfrendo 2y ago
  Only if you think that the market should encourage everyone to buy the most expensive thing they can afford. Larger cars are popular with manufacturers and dealers because of higher profit margins. A consumer should be able to pick a smaller, cheaper vehicle if they want it, but this makes their business less desirable. Just because there are few reasons to buy a smaller car does not mean there are no reasons, nor does it make it illogical to prefer one. I don't know if this is an economic concept that exists, but I'd call it an "accidental cartel." Corporations noticed that serving a particular customer base was less profitable than giving customers fewer, more expensive choices, so the market participants aligned themselves around this strategy until there are no cheaper, lower margin options left. In theory, that leaves an open market for a competitor, but to occupy that niche would be to spend resources on attracting a lower-quality customer (one who is less able to pay more, less interested in paying more, less susceptible to marketing, etc).
marcosdumay 2y ago
Markets don't work when there are huge barriers to entry. That's widely known, and for a very long time already.
michaelt 2y ago
I have heard it claimed this happened because: 1. Lawmakers put an import tax on trucks, and (perhaps not entirely intentionally) made emission standards for SUVs lower than those for cars. 2. US automakers were getting their ass kicked by foreign imports that were much better made in the car segment, but not in the SUV and truck segment. 3. US automakers decided to heavily promote trucks and SUVs, the segments they were most competitive in. You know, pay to make sure all the characters in that TV show are driving SUVs and whatnot. 4. Lawmakers decided to maintain the state of affairs from 1 because they like US automakers.

Seems like the market isn't working.

by croes 2y ago

Seems like the market isn't working.

psychlops 2y ago

Cheap gas allows the cars to get bigger. Seems like the market has filled the gap as one might expect?

antimemetics 2y ago

I was thinking exactly that - shouldn’t capitalism regulate this kind of thing on it’s own or something

xpe 2y ago
Self-interest strives to break (or break out of) competitive markets to one’s own benefit.
deleted 2y ago
[deleted]
smsm42 2y ago
The idea that "capitalism" somehow magically makes everybody do exactly what any particular person or set of persons want to happen is fascinating. How could one arrive to such a conclusion? No, that's not how "capitalism" works. It does not guarantee that the things you want to happen magically will happen because "market".
randomdata 2y ago
Not when government regulation favours larger vehicles (e.g. lower emission standards).

cranekam 2y ago

It clearly is. As the article makes out, the tax code and regulation favours large vehicles. Gas is cheap. Acting alone, there are few reasons to buy a smaller car if you can afford a bigger one. This is exactly the market “working” and why regulation is necessary to change it.

imglorp 2y ago
Gas is artificially cheap, but it's at enormous expense to the global community. The US spent $2T on the gulf wars to secure this, and globally spend at least $7T a year on fossil subsidies. This needs to end immediately. https://www.imf.org/en/Publications/WP/Issues/2023/08/22/IMF-Fossil-Fuel-Subsidies-Data-2023-Update-537281 https://www.imf.org/en/Publications/WP/Issues/2023/08/22/IMF...
animal_spirits 2y ago
More rules aren't going to fix the problem that more rules created. We need to reduce the amount of regulation on vehicles, specifically the CAFE regulations which are the driver behind large vehicles, and let the real market forces play out. Whenever governmental regulations get involved, the market forces are distorted to what the regulations incentivize, rather than what the people incentivize.
- baq 2y ago
  That’s literally the point of regulations and why civilization invented them. You want to get rid of bad regulations, obviously. You really don’t want to get rid of all regulations.
brendoelfrendo 2y ago
Only if you think that the market should encourage everyone to buy the most expensive thing they can afford. Larger cars are popular with manufacturers and dealers because of higher profit margins. A consumer should be able to pick a smaller, cheaper vehicle if they want it, but this makes their business less desirable. Just because there are few reasons to buy a smaller car does not mean there are no reasons, nor does it make it illogical to prefer one. I don't know if this is an economic concept that exists, but I'd call it an "accidental cartel." Corporations noticed that serving a particular customer base was less profitable than giving customers fewer, more expensive choices, so the market participants aligned themselves around this strategy until there are no cheaper, lower margin options left. In theory, that leaves an open market for a competitor, but to occupy that niche would be to spend resources on attracting a lower-quality customer (one who is less able to pay more, less interested in paying more, less susceptible to marketing, etc).

marcosdumay 2y ago

Markets don't work when there are huge barriers to entry. That's widely known, and for a very long time already.

michaelt 2y ago

I have heard it claimed this happened because: 1. Lawmakers put an import tax on trucks, and (perhaps not entirely intentionally) made emission standards for SUVs lower than those for cars. 2. US automakers were getting their ass kicked by foreign imports that were much better made in the car segment, but not in the SUV and truck segment. 3. US automakers decided to heavily promote trucks and SUVs, the segments they were most competitive in. You know, pay to make sure all the characters in that TV show are driving SUVs and whatnot. 4. Lawmakers decided to maintain the state of affairs from 1 because they like US automakers.