tag:blogger.com,1999:blog-6245381193993153721.post1888235884254779068..comments2024-03-28T17:08:15.784-07:00Comments on Social Democracy for the 21st Century: A Realist Alternative to the Modern Left: Firms have No Power to Compel any Buyer?Lord Keyneshttp://www.blogger.com/profile/06556863604205200159noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-6245381193993153721.post-50333272791898011382014-02-03T12:31:56.839-08:002014-02-03T12:31:56.839-08:00"And, even if enough buyers refuse to buy the...<i>"And, even if enough buyers refuse to buy the good for the firm to turn a profit, that is an outcome from the aggregate influence of buyers, not the individual buyer."</i><br /><br />There's something to this, I think.<br /><br />I've always found it fascinating that Austrians and like-minded fellow travelers react with fundamental revulsion when Post-Keynesians or Marxists try to analyze at the level of classes rather than individuals. Meanwhile, when their screwy price theory demands it, they're quite content to view the role of buyers as a class interaction, and then equivocate to try to pass that off as a freedom and power enjoyed by the individual, rather than the aggregate.Hedlundnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-77336483278454073422014-02-03T07:12:37.368-08:002014-02-03T07:12:37.368-08:00That is an insightful point! There is probably a g...That is an insightful point! There is probably a good blog post or article in that.Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-15164911898698679152014-02-03T07:11:30.501-08:002014-02-03T07:11:30.501-08:00"The term "market price" implies a ...<i>"The term "market price" implies a model of markets with an equilibrium arrived at by multiple buyers and sellers, complete with the assumption that no one party is dominant enough to change the equilibrium. "</i><br /><br />Well, yes, obviously the above is not a realistic model of price setting for many markets -- so that there is unequal market power between buyers and sellers in many transactions.<br />Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-69126817456064582752014-02-02T07:23:34.445-08:002014-02-02T07:23:34.445-08:00I might also point out that the enlightenment idea...I might also point out that the enlightenment idea of making political power publicly controlled rather than private is mirrored in the public control of prices in ideal free markets, rather than the private control of prices in less ideal situations such as haggling or where fix pricing occurs.Mike Hubenhttps://www.blogger.com/profile/01371469964446567690noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-90941613210300681432014-02-02T07:16:03.133-08:002014-02-02T07:16:03.133-08:00Are you sure you are analyzing this correctly?
Th...Are you sure you are analyzing this correctly?<br /><br />The term "market price" implies a model of markets with an equilibrium arrived at by multiple buyers and sellers, complete with the assumption that no one party is dominant enough to change the equilibrium. Under those conditions, it doesn't matter if one player attempts to withhold production: it will not change the equilibrium.<br /><br />The presence of fixprices indicates that an equilibrium model does not apply. In this situation, the manufacturer has the power to control the prices available to the buyer. This is a private power the manufacturer does not have in a market equilibrium.<br /><br />To the extent that lower priced substitutes are unavailable, the manufacturer is forcing buyers to pay a higher price. Mike Hubenhttps://www.blogger.com/profile/01371469964446567690noreply@blogger.com