3 ms·

How depressingly obvious.

by krallja 13y ago

anigbrowl 13y ago
The other sad thing about macro is a lack of consideration about the cash constraints facing poor consumers. For example, suppose there's some 20% off offer available on a regular household expense. The rational thing to do is buy in bulk so you can take advantage of the offer, but if you're poor that option isn't necessarily available, because buying in the requisite quantity to receive the discount means going without some other necessity - eg there's no point in buying lots of diapers when they're on sale if it means there's no money left over for baby food.* Of course couponing allows for fairly flexible strategies and with time the savings can add up, allowing for some greater flexibility; but the underlying fact is that the more money you have, the easier it is to take advantage of discounts that save you money. Inability to access economies of scale is a brutal fact of life at the bottom of the economic pyramid that manifest almost every time one needs to buy food. * It's just an example, don't get hung up on what exact level of public assistance is available to people with babies in an attempt to negate the point.
- unclebucknasty 13y ago
  This is absolutely true and is a part of the general cash flow problem that the poor face. Never having surplus (or even being at a defecit) after attempting to meet their basic needs month-over-month serves to keep them from moving ahead. For instance, it is very difficult to reduce debt, invest, obtain an education, or otherwise "get ahead". All income is instead spent on day-to-day subsistence, so they continue to receive a lower share of the economy, while paying down little principal and paying maximum interest. It's another overlooked element: it's not just about income and wealth. It's about cash flow. It's just somehow odd that if a person earned the same income over his lifetime, but received a sizeable advance on some portion, it could dramatically alter the quality of his life.

How depressingly obvious.

by krallja 13y ago

How depressingly obvious.

The other sad thing about macro is a lack of consideration about the cash constraints facing poor consumers. For example, suppose there's some 20% off offer available on a regular household expense. The rational thing to do is buy in bulk so you can take advantage of the offer, but if you're poor that option isn't necessarily available, because buying in the requisite quantity to receive the discount means going without some other necessity - eg there's no point in buying lots of diapers when they're on sale if it means there's no money left over for baby food.* Of course couponing allows for fairly flexible strategies and with time the savings can add up, allowing for some greater flexibility; but the underlying fact is that the more money you have, the easier it is to take advantage of discounts that save you money. Inability to access economies of scale is a brutal fact of life at the bottom of the economic pyramid that manifest almost every time one needs to buy food. * It's just an example, don't get hung up on what exact level of public assistance is available to people with babies in an attempt to negate the point.

unclebucknasty 13y ago
This is absolutely true and is a part of the general cash flow problem that the poor face. Never having surplus (or even being at a defecit) after attempting to meet their basic needs month-over-month serves to keep them from moving ahead. For instance, it is very difficult to reduce debt, invest, obtain an education, or otherwise "get ahead". All income is instead spent on day-to-day subsistence, so they continue to receive a lower share of the economy, while paying down little principal and paying maximum interest. It's another overlooked element: it's not just about income and wealth. It's about cash flow. It's just somehow odd that if a person earned the same income over his lifetime, but received a sizeable advance on some portion, it could dramatically alter the quality of his life.