The problem with the data referenced is that as far as I can tell it’s a bunch of surveys. And I really don’t understand how you expect to discuss microeconomics at the level of one seller like the essay references without it being talking about anecdotes.
In general, (not specifically economics) I find ignoring the consensus of experts in a field leads you to conspiracy theories. So yes, in terms of sources reliability and my rating system for who to trust, I will take the standard college classes and consensus of experts.
It feels like each thing I address just has you pulling either a non-sequitor or just lambasting standard economics.
I also don’t really see what you are arguing with me about except for a pedantic definition of supply vs demand or if those are even concepts.
The main argument in the essay is that the money printer doesn’t lead to inflation. I never claimed it does, and all but one standard theory referenced in that essay agrees with you and the essay writer that it’s not a straight “hydrolic” relationship.
The anecdotes you’re both ignoring is that unless you’re rather well off, if you get a raise or a stimulus package - almost everyone spends that money (or pays off debt, which is less direct but does free up spending power down the road). And we have seen shortages that pretty much were driven by hoarding in the pandemic. One vital part of that is having the money to spend - there were few reports of stealing actually leading to shortages.
And you completely skip the scalpers - did we imagine the PS5s being only available on ebay for 3x or more the MSRP? Did not having more money enable people to pay more to bid up the going price for the few available? What is that if not microeconomic supply and demand curves meeting at ebay sold prices?
I suppose the link you’re disputing is getting from individual sales to the economy at large, but that’s the problem this theory has, the reverse of the issue the essay claims traditional economics has.
So like… does traditional economics have any data to back up supply & demand? Because you’re still just telling stories and dismissing the research as not good enough for you.
I would like to see this much better research that is good enough for you.
I’m not going to get distracted with your stories and forget that you haven’t supplied any data of your own.
This isn’t a “non-sequitir”, it is the core of what I’m saying.
But if you absolutely must hear a response on one of your stories: scalping is a very localised and minor part of the economy. Most of the economy doesn’t behave that way. This is hardly creating the dominant law that traditional economics tells us about.
Edit: And you still haven’t given any data to prove the anecdote about scalpers, only told a story.
On Scalping - I don’t know that anyone has done a study proving the existence of it, but it’s a major part of news stories over the last 10 years, and there’s papers about how scalpers often set ticket prices in the secondary market, and how it also more effectively allocates the tickets:
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4324594
Finally, maybe you just aren’t understanding me - are you saying you’ve never been to Ollies or Tuesday Mornings or seen liquidation or end of model year sales? You need a study to prove to you this happens pretty much all the time? You are arguing that if you’ve got a bunch of IDK 2022 Camrys on your lot when the 2023s start coming in, you’re going to have less demand and less ability to sell those 2022s if you price them the same as the 2023s (i.e. demand dropping causing prices to need to drop to sell)?
Look - maybe you think “supply and demand” is too simplistic, and I agree. But if you’re saying NO WHERE in the economy does supply vs demand affect pricing then I don’t know what to tell you - just watching the News or living life buying stuff proves you wrong.
First of all, I’m not saying there is never a correlation between supply & demand, what I am saying, and what that article I linked you was saying, is that the causal mechanism between macroeconomics and actual price fluctuations is not given by supply & demand theory. I am saying that correlation is not causation, and if you want a functioning, usable theory of economics that makes predictions that can be trusted, you need a mechanism. Supply & demand doesn’t have one. It finds some correlation and then says it’s following a law, without ever doing the work to explain how.
The COVID studies are showing people debating about what the shock was, assuming supply & demand is in operation, but ultimately the only conclusion you can draw is that whatever correlation exists must be co-causal. Both supply & demand shocks were caused by COVID. That’s like… obvious. If you wanted to establish more than that you’d need to dig into the causal relationship, but they don’t. Unless they do in which case… can you please show me where?
That first article is exactly the problem that I’m talking about. It spends the entire time trying to convince the reader that a correlation exists, and telling stories to explain why it doesn’t always fit. It’s pure post-hoc justification.
Like JUST LOOK AT IT. Nobody makes that graph if they have the data available to make a real graph. That is a doodle. It is two perfectly straight, perpendicular lines forming a cross, on a graph with no scale. That is there to illustrate the concept of correlation as if it weren’t perfectly obvious. That is what I would show a small child if I wanted them to grow up to fundamentally misunderstand statistics. I have seen that diagram, but I didn’t mention it earlier because I didn’t want to strawman you. Apparently you actually think that’s worth showing me.
If you had spent any time in hard sciences you would know two things:
Correlation does not imply causation
People with data will show you the data. They did hard work for it, they are proud of their graphs, and they want you to see the details and insights they are able to wring from it.
Any scientist would be absolutely horrified to present something like that. They would be too afraid of insulting their audience, either by implying this pair of lines they clearly just made up means anything, or by implying the audience were actual children.
And they don’t do this:
The Science of Supply and Demand
by David F. Perkis
“A body in motion tends to stay in motion unless acted on by an out-side force.”
—Isaac Newton
Science Is Everywhere
We live in a world governed by the laws of science. From gravity, to electromagnetism, to sound waves, our lives are filled with scientific phenomena that structure and affect every facet of our daily routine. As a species, we have attempted at every turn to channel the laws of science to our own benefit, constantly working to build better products and to develop improved means of manufacturing. However, sometimes science unveils itself in unanticipated ways—ways that often force its will on the distribution of goods in markets.
What the hell is this? What is it? What are they talking about? This is someone trying to coopt the aesthetics of science without doing any.
I can’t access the scalping paper, but honestly if supply & demand dictated pricing, why don’t ticket prices rise and scalpers get squeezed out? That is what the law of supply & demand would dictate, wouldn’t it?
What the scalping situation shows us is companies working hard to fight scalping WITHOUT raising prices, in direct contravention of the law of supply & demand.
The problem with the data referenced is that as far as I can tell it’s a bunch of surveys. And I really don’t understand how you expect to discuss microeconomics at the level of one seller like the essay references without it being talking about anecdotes.
In general, (not specifically economics) I find ignoring the consensus of experts in a field leads you to conspiracy theories. So yes, in terms of sources reliability and my rating system for who to trust, I will take the standard college classes and consensus of experts.
It feels like each thing I address just has you pulling either a non-sequitor or just lambasting standard economics.
I also don’t really see what you are arguing with me about except for a pedantic definition of supply vs demand or if those are even concepts.
The main argument in the essay is that the money printer doesn’t lead to inflation. I never claimed it does, and all but one standard theory referenced in that essay agrees with you and the essay writer that it’s not a straight “hydrolic” relationship.
The anecdotes you’re both ignoring is that unless you’re rather well off, if you get a raise or a stimulus package - almost everyone spends that money (or pays off debt, which is less direct but does free up spending power down the road). And we have seen shortages that pretty much were driven by hoarding in the pandemic. One vital part of that is having the money to spend - there were few reports of stealing actually leading to shortages.
And you completely skip the scalpers - did we imagine the PS5s being only available on ebay for 3x or more the MSRP? Did not having more money enable people to pay more to bid up the going price for the few available? What is that if not microeconomic supply and demand curves meeting at ebay sold prices?
I suppose the link you’re disputing is getting from individual sales to the economy at large, but that’s the problem this theory has, the reverse of the issue the essay claims traditional economics has.
So like… does traditional economics have any data to back up supply & demand? Because you’re still just telling stories and dismissing the research as not good enough for you.
I would like to see this much better research that is good enough for you.
I’m not going to get distracted with your stories and forget that you haven’t supplied any data of your own.
This isn’t a “non-sequitir”, it is the core of what I’m saying.
But if you absolutely must hear a response on one of your stories: scalping is a very localised and minor part of the economy. Most of the economy doesn’t behave that way. This is hardly creating the dominant law that traditional economics tells us about.
Edit: And you still haven’t given any data to prove the anecdote about scalpers, only told a story.
https://research.stlouisfed.org/publications/page1-econ/2021/03/01/the-science-of-supply-and-demand for instance used the COVID economic data to show how lack of supply, or lack of demand depending on the industry bore out what one might expect.
On Scalping - I don’t know that anyone has done a study proving the existence of it, but it’s a major part of news stories over the last 10 years, and there’s papers about how scalpers often set ticket prices in the secondary market, and how it also more effectively allocates the tickets: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4324594
https://www.tomshardware.com/news/how-scalpers-justify-their-actions points to numerous news articles, and denying that this happens when there’s high demand for items in low supply is like denying there’s a war in Ukraine right now because there’s no study proving it.
Finally, maybe you just aren’t understanding me - are you saying you’ve never been to Ollies or Tuesday Mornings or seen liquidation or end of model year sales? You need a study to prove to you this happens pretty much all the time? You are arguing that if you’ve got a bunch of IDK 2022 Camrys on your lot when the 2023s start coming in, you’re going to have less demand and less ability to sell those 2022s if you price them the same as the 2023s (i.e. demand dropping causing prices to need to drop to sell)?
Look - maybe you think “supply and demand” is too simplistic, and I agree. But if you’re saying NO WHERE in the economy does supply vs demand affect pricing then I don’t know what to tell you - just watching the News or living life buying stuff proves you wrong.
First of all, I’m not saying there is never a correlation between supply & demand, what I am saying, and what that article I linked you was saying, is that the causal mechanism between macroeconomics and actual price fluctuations is not given by supply & demand theory. I am saying that correlation is not causation, and if you want a functioning, usable theory of economics that makes predictions that can be trusted, you need a mechanism. Supply & demand doesn’t have one. It finds some correlation and then says it’s following a law, without ever doing the work to explain how.
The COVID studies are showing people debating about what the shock was, assuming supply & demand is in operation, but ultimately the only conclusion you can draw is that whatever correlation exists must be co-causal. Both supply & demand shocks were caused by COVID. That’s like… obvious. If you wanted to establish more than that you’d need to dig into the causal relationship, but they don’t. Unless they do in which case… can you please show me where?
That first article is exactly the problem that I’m talking about. It spends the entire time trying to convince the reader that a correlation exists, and telling stories to explain why it doesn’t always fit. It’s pure post-hoc justification.
But I want you to look at this graph:
https://files.stlouisfed.org/files/htdocs/publications/images/uploads/2021/POE2103Fig5_20210219101335.jpg
Like JUST LOOK AT IT. Nobody makes that graph if they have the data available to make a real graph. That is a doodle. It is two perfectly straight, perpendicular lines forming a cross, on a graph with no scale. That is there to illustrate the concept of correlation as if it weren’t perfectly obvious. That is what I would show a small child if I wanted them to grow up to fundamentally misunderstand statistics. I have seen that diagram, but I didn’t mention it earlier because I didn’t want to strawman you. Apparently you actually think that’s worth showing me.
If you had spent any time in hard sciences you would know two things:
Correlation does not imply causation
People with data will show you the data. They did hard work for it, they are proud of their graphs, and they want you to see the details and insights they are able to wring from it.
Any scientist would be absolutely horrified to present something like that. They would be too afraid of insulting their audience, either by implying this pair of lines they clearly just made up means anything, or by implying the audience were actual children.
And they don’t do this:
What the hell is this? What is it? What are they talking about? This is someone trying to coopt the aesthetics of science without doing any.
I can’t access the scalping paper, but honestly if supply & demand dictated pricing, why don’t ticket prices rise and scalpers get squeezed out? That is what the law of supply & demand would dictate, wouldn’t it?
What the scalping situation shows us is companies working hard to fight scalping WITHOUT raising prices, in direct contravention of the law of supply & demand.