Arguably the only value they provide to society is finding the actual equilibrium price of a PS5. Is that important enough to be “good”?
Sure, they provide value to their customers. But every PS5 that is bought for scalping makes it harder to find a PS5 at the store. They’re effectively spending other people’s time to save their customers’ time. Qualitatively, that sounds like a transfer of value from one group to another—not a benefit to society overall.
In the end, the same number of people will own a console and get to use it. Unless one person’s leisure is worth more to society than another’s, no value (to society) will be created by manipulating this distribution of resources. The one who will really benefit are the scalpers themselves. Sure, it might not be textbook rent-seeking, but it’s pretty close.
(I do admit this argument might “prove too much”, and could be turned around to any store selling any good...)
As I said in my reply to Dave Orr above, I now suspect that my opinion on the goodness or badness here is probably dominated by the net effect on the deadweight loss of time. (I’m not sure how much I think this should be weighted by the economic and/or social value of each person’s time.)
So my main questions now are (1) what is the net effect, and (2) what would the net effect be, if people were more rational about how much they value their time? (I’m also not sure how much the answer to (2) would change my view.)
It sounds like you think the answer to (1) is positive?
Sure, it might not be textbook rent-seeking, but it’s pretty close.
One important difference from classic pro-price-gouging arguments here, that I didn’t really crystallise until now, is that the scalpers aren’t really doing anything (AFAIK) to increase supply. So we lack the cutting-down-logs-with-chainsaws angle.
I think you’re right that it’s an overall loss. If they’re going to be sold at above msrp, it might as well go to the manufacturer to incentivize more supply. Otherwise, that delta goes to scalpers, and the scalpers have to spend their time. I think the reason Sony doesn’t raise prices is because it is sensitive to perception of users. The console itself is really just a portal to the Sony ecosystem, which is where the money is made anyways. They don’t want to be seen as charging you for the privilege of paying them for subscriptions and $80 games, especially since their model vis-a-vis PC gaming is lower upfront cost, higher ongoing costs. I think they’re playing the long game here, content to let the scalpers take the heat, while they wait out supply shocks that everyone sees as transient anyways.
Arguably the only value they provide to society is finding the actual equilibrium price of a PS5. Is that important enough to be “good”?
Sure, they provide value to their customers. But every PS5 that is bought for scalping makes it harder to find a PS5 at the store. They’re effectively spending other people’s time to save their customers’ time. Qualitatively, that sounds like a transfer of value from one group to another—not a benefit to society overall.
In the end, the same number of people will own a console and get to use it. Unless one person’s leisure is worth more to society than another’s, no value (to society) will be created by manipulating this distribution of resources. The one who will really benefit are the scalpers themselves. Sure, it might not be textbook rent-seeking, but it’s pretty close.
(I do admit this argument might “prove too much”, and could be turned around to any store selling any good...)
As I said in my reply to Dave Orr above, I now suspect that my opinion on the goodness or badness here is probably dominated by the net effect on the deadweight loss of time. (I’m not sure how much I think this should be weighted by the economic and/or social value of each person’s time.)
So my main questions now are (1) what is the net effect, and (2) what would the net effect be, if people were more rational about how much they value their time? (I’m also not sure how much the answer to (2) would change my view.)
It sounds like you think the answer to (1) is positive?
One important difference from classic pro-price-gouging arguments here, that I didn’t really crystallise until now, is that the scalpers aren’t really doing anything (AFAIK) to increase supply. So we lack the cutting-down-logs-with-chainsaws angle.
I think you’re right that it’s an overall loss. If they’re going to be sold at above msrp, it might as well go to the manufacturer to incentivize more supply. Otherwise, that delta goes to scalpers, and the scalpers have to spend their time. I think the reason Sony doesn’t raise prices is because it is sensitive to perception of users. The console itself is really just a portal to the Sony ecosystem, which is where the money is made anyways. They don’t want to be seen as charging you for the privilege of paying them for subscriptions and $80 games, especially since their model vis-a-vis PC gaming is lower upfront cost, higher ongoing costs. I think they’re playing the long game here, content to let the scalpers take the heat, while they wait out supply shocks that everyone sees as transient anyways.