From Each According to Their Ability...
Capitalism and technology working together to create a more communist society.
One of the first lessons you learn in economics is the law of supply and demand. Theoretically, you want to reach equilibrium between supply and demand. Unfortunately, doing so means you lose a potential market above the point of equilibrium, which would have paid more for your item, and you lose a potential market below the point of equilibrium, which cannot pay the asking price for your item. Of course, you do get to sell the optimum number of units at the optimum price.
The market has come up with some nice ways to try and retake these markets. Let's take an example - the movie Star Wars. Say for example, you wanted to see the movie before its general release date. You could have driven to a large city and paid a couple hundred to attend a special charity screening. That's the market above the point of equilibrium. Now lets say you don't have $10 to spend on the movie for you and your friends or family. You can wait until the movie comes out at a discount theatre, wait and rent it from the store, or if free works for you, wait until the television premiere. That captures the market below the point of equilibrium. Still, most people who actually want to see the movie are going to pay the $10 and see it.
Now the internet has come up with a genius way to handle supply and demand based on the information available about you! It's like capitalism meets communism. By keeping track of you on the internet a company can get a fairly good idea of your household income. It can then charge you according to your income for items you wish to purchase. Theoretically at least this same method could be used in a brick and mortar store. I know a lot of people were really pissed off when they found out a couple of companies online were using a sliding scale, but under laissez-faire capitalism I'm not sure what's so bad about it. It you want to pay less money you can always earn less money.
I can just envision Adam Smith and Karl Marx rolling over in their graves.
One of the first lessons you learn in economics is the law of supply and demand. Theoretically, you want to reach equilibrium between supply and demand. Unfortunately, doing so means you lose a potential market above the point of equilibrium, which would have paid more for your item, and you lose a potential market below the point of equilibrium, which cannot pay the asking price for your item. Of course, you do get to sell the optimum number of units at the optimum price.
The market has come up with some nice ways to try and retake these markets. Let's take an example - the movie Star Wars. Say for example, you wanted to see the movie before its general release date. You could have driven to a large city and paid a couple hundred to attend a special charity screening. That's the market above the point of equilibrium. Now lets say you don't have $10 to spend on the movie for you and your friends or family. You can wait until the movie comes out at a discount theatre, wait and rent it from the store, or if free works for you, wait until the television premiere. That captures the market below the point of equilibrium. Still, most people who actually want to see the movie are going to pay the $10 and see it.
Now the internet has come up with a genius way to handle supply and demand based on the information available about you! It's like capitalism meets communism. By keeping track of you on the internet a company can get a fairly good idea of your household income. It can then charge you according to your income for items you wish to purchase. Theoretically at least this same method could be used in a brick and mortar store. I know a lot of people were really pissed off when they found out a couple of companies online were using a sliding scale, but under laissez-faire capitalism I'm not sure what's so bad about it. It you want to pay less money you can always earn less money.
I can just envision Adam Smith and Karl Marx rolling over in their graves.
posted by Ranger | 6:31 AM
3 Comments:
Hmmmm. I'm all for a sliding scale when it has to do with services, but seriously -- with products?
Not so much.
(sorry I can't be more articulate, it's been a killer week.)
But in a sense it's exactly what happens when you put something up on ebay. Or if you put your batik stand at an upscale bazaar. Or if you were bartering with a man wearing a sharp three piece suit. Your price would go up based on the income of the buyer. Goods or services.
I don't know if I can come over here and read anymore. You're way smarter than me.
Have I mentioned that my hair looks great today?
*mwah* to you and Melody -- where is her blog, by the way?
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