https://www.cnn.com/2023/06/09/economy/us-inflation-high-prices-consumer-demand/index.html

That means a business can essentially set prices as high as it wants, as long as they aren’t so high that they drive away the customer base. In other words, it’s Econ 101: Good, old-fashioned supply and demand.

:AmISoOutOfTouchmeme: Could it be greed? No, it's the customers fault.

  • GnastyGnuts [he/him]
    ·
    2 years ago

    That means a business can essentially set prices as high as it wants, as long as they aren’t so high that they drive away the customer base. In other words, it’s Econ 101: Good, old-fashioned supply and demand.

    It's the weekend and I'm loaded, but don't these two sentences contradict each other? The first seems to acknowledge that businesses will charge as much as they can get away with, and then the second sentence attributes this to supply and demand rather than businesses choosing to charge high prices entirely on their own.

    It's been a while since I took an economics class, but I don't recall supply and demand meaning "businesses unilaterally deciding to charge way more on the basis that they can get away with it."

    • EmmaGoldman [she/her, comrade/them]M
      ·
      2 years ago

      Supply and demand curves are bullshit and largely not considered an objective thing even within the bullshit that is econ. Supply and demand is kind of a shorthand for communication purposes, and isn't really an important factor. Unlabeled axes and the likes.

      The concept it's intended to communicate ie that for a given quantity, quality, and price of a good, there is a given consumer demand for it. The difference between elastic and inelastic demand is that as the price changes, the demand will change greatly for elastic goods, but will remain largely the same for inelastic goods.

      Elastic goods are things like cookies and luxury cars and $3500 VR headsets. Inelastic goods are things like soap, rent, and staple foods.

    • Naal [he/him]
      ·
      2 years ago

      what only considering the profit motive does to a mfer :sadness:

      Just because businesses can charge more and make more profit doesn't mean they should, which is the part that Econ 101 leaves out. Any negative externalities on society caused by this don't show up on an individual firm's balance sheet so they may as well not exist. Unfortunately, capitalism does seek greater and greater profit, so businesses do end up raising prices as much as they possibly can. Which leads to greater class stratification, and you're into pretty textbook Marx at this point