Diarmid Weir Says:

September 10, 2011 at 11:04 am e

Each individual will have different opportunity costs, predicting their choices is not possible.

They don’t need to be predicted for competitive pressure to bring the price down to the point at which they bite.

Given that competition exists. Given that competition lowers prices. We are still left with individuals who will make choices. You cannot predict those choices.

…that window of opportunity grows ever smaller, measured in hours perhaps.

I think you sadly underestimate the wiles of capitalists and the limits to most individual consumers’ capacity to process information!

Social media hardly concerns itself with complex information. Social media is gossip. Gossip is easy to process as it is vacuous. However, in the marketplace where products gain or lose reputation, gossip trumps advertising. Gossip originates from friends and family, and we know they are trustworthy and well informed!

Egalitarianism is a myth, and not even desirable, never mind achievable.

Can a myth be desirable or achievable?

It can certainly be desired.

I think this statement is a bit incoherent, to say the least. What do you mean by egalitarianism, anyway? Do you believe that any level of inequality should be quite acceptable to everybody, as long as it occurs without violating ‘property rights’?

Individuals are not equal. That is partly genetic, partly environment. Either way, some will always outperform others and gain proportionately more. As long as they do not violate the property rights of others pursuing this end, that is perfectly acceptable, and will in point of fact improve conditions for the less capable along the way.

Does it actually matter what you believe given that violent redistribution will have taken place long before one man (and it would of course be a man!) owns and controls everything?

We have already discussed the proposition that the free market can provide all the checks and balances currently performed by government, far more efficiently and equitably than government.

As this is clearly not possible, the calculation of a case probability is not possible.

Ouh, you Keynesian, you!

There you go, trying to hurt my feelings again.

I did put probability in quotes for a reason. You can’t tell me that a serious entrepreneur doesn’t apply some sort of subjective probability to any risky undertaking.

Of course he does. He can call it whatever he wants. However unless it is based on a class probability, it is not a probability at all. I must have missed the “”.

Otherwise he can have no special skill worth considering. He/she is just more impulsive than the rest of us. Now this probability may be nowhere near accurate, but it does help to determine his/her target profit. To find out if that’s fair or not will take a bit of negotiation – which requires equality of power and information on both sides.

There is no fair/unfair. If he achieves his target, or exceeds his target, then obviously he has forecast accurately/luckily and obtains his profit. If it is truly excessive, which if he is the first to market with a new product is likely/possible, competition will soon enter the market reducing the profit margins. This is the nature of the free market, unless of course government intervenes and grants him a patent which extends his high profit margin into a monopoly gain.

Note that your acceptance of this sort of uncertainty coupled with your scepticism over social/economic prediction completely removes any possibility whatsoever of claiming any benefit for a purely free-market system. You are yet again left with only your a priori property rights for solace.

Not at all.

Then both LIDL and Tesco are in trouble.

So you see – adjusting prices to production costs does make a difference.

Of course it makes a difference to production. But not to value. It was value that we were talking about.