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It is the other way around, When people want something they are willing to pay more for it. The manufacturer wants to sell to the person that will pay the most.
by somat 2mo ago
It is the other way around, When people want something they are willing to pay more for it. The manufacturer wants to sell to the person that will pay the most. While the person wants to buy from the manufacturer that charges the least. As such when the manufacturing capacity is below demand the price goes up until the item is worth what people will pay for it(at large, statistically, it works like an auction). The promise of capitalism is that as the price goes up it should incentivize manufacturing capacity to go up and as the capacity meets demand and the manufactures start to fight each other to be the one to sell the item the price goes down.
Sometimes this works and sometimes it does not.
- docjay 2mo agoThank you for taking the time and effort to provide a clear explanation. I’m familiar with supply and demand though. My emphasis was on “must” as a lazy protest against greed being considered a mandatory part of capitalism. Prices don’t have to go up, someone just wants more money. If you happily sell apples for $1 and see a hungry person walking towards you, must you raise the price? I think that basic thought gets lost sometimes when people talk about shortages causing the price to increase. The shortage didn’t cause anything, some executive decided they want more money. That’s all. There’s nothing inherent in the system that requires it. Whether that’s OK or not is up to the reader, I just think people lose sight of the reality and talk about it like it’s gravity, rather than simple decision making.
- ShinyLeftPad 2mo ago> If you happily sell apples for $1 and see a hungry person walking towards you, must you raise the price? if you happily sell apples for $1 and now there are VC-funded companies who need a ton of apples to produce some dubious crap and can pay you $5 per. And you are the only company selling apples. what you should do is keep selling $1 apples to retail customers and charge corporations as much as they accept. you invest it into more apple trees and maybe subsidize the hungry people even
- 1718627440 2mo agoThe issue with that solution is that in order to sell to retail customers, they sell to other large corporations, which they think are going to sell to retail customers. Guess what happens when they find out, you are charging other corporation higher prices.
- ShinyLeftPad 2mo agoGuess they have no choice, because you're the only one selling apples
- docjay 2mo agoBut what do you suppose the corporations do with the apples you’re selling to them? Adding a degree of separation doesn’t change what you’re doing, and you’re not morphing into Robin Hood. To be clear, I’m not taking a fully altruistic position. I’m just tired of price hikes on things, from apples to memory, being blamed on the weather rather than openly understanding that it’s a person wanting more money. “I can’t afford gas because of the shortage” - No, it was the CEO saying a number in a meeting and that person has a name. When someone is robbed we don’t say “an economic disparity caused a wealth adjustment.”
- ShinyLeftPad 2mo agoIt's not Robin Hood it's basic decency...