Economists point out that price increases have two benefits. First, medical professionals who especially require masks spend a large amount of money to purchase, thereby suppressing the purchase of ordinary people. And rising prices encourage manufacturers to increase production. There are downsides to price increases. Only richer people can buy masks. It’s obvious, reasonable, and fair: an economist
This Is Not Capitalism
Many states in the United States have laws to curb rising prices. For example, California bans raising prices by more than 10% in emergency situations. At present, there are no reports that these laws have been applied in relation to masks. Many economists say that controlling prices is problematic: if price declines are controlled artificially, the market will run out of goods.
Amazon, which uses algorithms to increase selling prices and make big money, announces a cautious policy. According to one study, a company that seeks to make a profit by taking advantage of a crisis situation will be severely affected if its negative image is established. For example, after Hurricane Sandy (2012), Uber disappointed with price increases and failed ads.
THE WOLF STREET REPORT: What Will the Coronavirus Do to the US & Chinese Economy? | Wolf Street… What Will the Coronavirus Do to the US & Chinese Economy? …
Some products, such as price destruction, have fallen dramatically. Consumers want cheap products. At that time, are consumers fooled by the price? In other words, they pay more attention to the price than the product. Do you have the illusion that it is valuable because it is expensive before the product? On the contrary, even if it is an excellent product or a necessary product, it is felt that the value is low because the price is low.
If we don’t make that mistake, we don’t think we’ll splurge
For general products, prices are displayed along with the products. Aren’t there many shops that sell things without telling the price? Many consumers look at goods, then look at prices and decide whether to buy. If the price is balanced with the product, you can buy it. If the product and price are not balanced, do not buy. It’s free.
Why is the balance between product and price broke? Isn’t that because the maker and the seller are different? When a creator, a seller, and a buyer are independent, unexpected things happen. If the three were the same, what would be the price? I do not know.
A couple with a two-year-old child tried to buy a mask to combat coronavirus. The father, as usual, thought it would take a couple of minutes to search the net, but he couldn’t. It quickly became clear that Amazon was unable to deliver to Prime members within the next day. Delivery will be one month later. Dad quickly searched for major drugstores, but CVS, Walgreens, and Target were all sold out. Finally, when Dad searches on eBay, it’s expensive. Even the cheapest mask was four times the normal price.
A 3M 30-pack N95 mask is available on Amazon for about $ 200. This is usually a $ 15 item. According to Nielsen,
medical mask sales in the United States are expected to be 319 percent higher than a year ago
For economists, this is a characteristic of a functioning market. The normal economic outlook is that prices should be free to balance supply and demand: an economist
Eventually, the couple bought $ 50 a box of masks, but they were defective. It could not be used to control coronavirus.
Are High Mask Prices The Problem Or The Solution? : Planet Money : NPR… “I later found out that these might not actually be super effective against coronavirus,” he says. …
Luxury products are expensive. This is a basic trend, but not always. Unnecessary, less valuable products can be priced higher. Conversely, useful and important products are cheaper.
Amazon’s policy is “fair pricing.” According to recent sources, some mask retailers are banned from listing on Amazon if they raise their prices significantly. It’s sad that there are stores that try to raise the price of necessary and basic products, Amazon spokeswoman said.
Amazon doesn’t want to offend consumers. Mask sales are a small percentage for them, but if people get frustrated by Amazon, overall sales will fall. Economists point out: The solution to the mask shortage is to determine the market price. Raising the price of a mask is good for the world. Amazon is trying to improve its reputation selfishly.
Is expensive coffee in expensive stores really good? As long as I entered, ordered, and drank the store, I want to believe it was delicious. That’s it for today’s post. Thank you
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