People rightly notice that you can we can make things better, but they rarely grasp that they’re not given the benefits. Those who make technology worth 4000$ are not going to sell it sold at 2000$, making everyone better off. The gap between the value we find in things, and the value we pay for it, will be exploited by companies until it almost disappears. They will sell it at 3950$, or sell it at 3500$ and fill it with advertisements (whatever makes it just barely worth it for the buyer) For as long as it’s a good deal, there’s more value to extract! And once 95% of the value has been extracted, the new technology only benefits everyone 5% of what it could have. (This pattern doesn’t apply when the technology is sufficiently easy to mass-produce, but even then, other zero-sum mechanics will kick in, and other cognitive biases prevent people from thinking about these)
The only reason the technology is “worth” $4000 is because people were willing to pay that in the first place. You as the consumer chose to capture the qualitative value it provides you at that price: if you were not willing to pay, the price would fall until you were (or the technology itself cannot be made more cheaply).
I’ll have to disagree. Selling something to you at its precise value (or arbitrarily close) is a malicious economic exploit.
All the good effects which are possible comes from the gap between what the buyer values something at, and what the selling values something at. If something is worth 4000$ to you, and I can produce it at 2000$, I can sell at 3000$ and we’ll both benefit with 1000$ of value. But if I sold it at 3995$, I’d be no better than a scalper and you’d only benefit if the time the purchase took is worth less to you than 5$. Think about it, your water company could charge you more, and there’s likely nothing you could do about it if you wanted to survive. But your water company does not exploit you like this, even though it technically could. It does not maximize profits, at least not yet.
My previous comment does not mention competition, but that’s something which will often force this exploit to not be possible. But as tech gets more complicated, the amount of alternative choices naturally drop (sometimes it looks like you have a choice, e.g. it looks like there is more than 2 different browsers, but the vast majority of them are based on Chromium and Firefox. It also looks like there’s many search engines, but they all collect from a relatively small set of indexes)
The only reason the technology is “worth” $4000 is because people were willing to pay that in the first place. You as the consumer chose to capture the qualitative value it provides you at that price: if you were not willing to pay, the price would fall until you were (or the technology itself cannot be made more cheaply).
I’ll have to disagree. Selling something to you at its precise value (or arbitrarily close) is a malicious economic exploit.
All the good effects which are possible comes from the gap between what the buyer values something at, and what the selling values something at. If something is worth 4000$ to you, and I can produce it at 2000$, I can sell at 3000$ and we’ll both benefit with 1000$ of value. But if I sold it at 3995$, I’d be no better than a scalper and you’d only benefit if the time the purchase took is worth less to you than 5$. Think about it, your water company could charge you more, and there’s likely nothing you could do about it if you wanted to survive. But your water company does not exploit you like this, even though it technically could. It does not maximize profits, at least not yet.
My previous comment does not mention competition, but that’s something which will often force this exploit to not be possible. But as tech gets more complicated, the amount of alternative choices naturally drop (sometimes it looks like you have a choice, e.g. it looks like there is more than 2 different browsers, but the vast majority of them are based on Chromium and Firefox. It also looks like there’s many search engines, but they all collect from a relatively small set of indexes)