Jubas
Bluelighter
- Joined
- Apr 26, 2003
- Messages
- 653
very true bigtrancer, but it also proves a non-existant equilibrium. its basically the opposite to consumer knowledge. one side which apollo and i have mentioned is that people don't know enough about it to make an informed decision due to a) a lack of knowledge regarding the drug itself, and therefore its total/marginal utility. and b) they don't know availability, if their dealer really is the cheapest price.
b) applies more to economic theory. illegal substances are very much bought on a 'who knows/has em' type basis. you often here people saying 'pills are shit at the moment', to which someone replies 'they're ok IT DEPENDS WHO YOU KNOW'. microeconomic theory relies on a consumer being able to get the cheapest price relatively easily. as soon as a product is classed illicit, the ease of getting the product is rapidly decreased. its not like dealers can advertise prices in a website. therefore, consumers can't choose the right price and hence demand/supply schematics start to falter.
your point about people trying it to experiment distorts what a normal equilibrium would be. people are buying at a non=equilibrium price with imperfect knowledge.
(you'll also note that most microeconomic theory is based off the assumption of perfect competition. ie, multiple sellers/buyers etc.. but in that case the sellers are price *takers* not setters - which is completly different from reality aye?
)
anyways, a good discussion of the article. my view is that its pretty crap! interesting, but well below the level i come to expect from the economist!
b) applies more to economic theory. illegal substances are very much bought on a 'who knows/has em' type basis. you often here people saying 'pills are shit at the moment', to which someone replies 'they're ok IT DEPENDS WHO YOU KNOW'. microeconomic theory relies on a consumer being able to get the cheapest price relatively easily. as soon as a product is classed illicit, the ease of getting the product is rapidly decreased. its not like dealers can advertise prices in a website. therefore, consumers can't choose the right price and hence demand/supply schematics start to falter.
your point about people trying it to experiment distorts what a normal equilibrium would be. people are buying at a non=equilibrium price with imperfect knowledge.
(you'll also note that most microeconomic theory is based off the assumption of perfect competition. ie, multiple sellers/buyers etc.. but in that case the sellers are price *takers* not setters - which is completly different from reality aye?
)anyways, a good discussion of the article. my view is that its pretty crap! interesting, but well below the level i come to expect from the economist!
