Why do you think a retailer in NH will offer a price between $100 and $108 in your example?

in order to maximize profits

All I can find online is how much swipe fees hurt small businesses and businesses where average ticket size is small. If merchants are passing on the fee to consumers then what is causing them to suffer? If the consumer bears the cost of the swipe fee then it really should not matter to a merchant if it is 2%, $.22, or $22 since the merchant can just set prices to keep their margins where they want them when factoring these costs in.

Do you think there is a price competition between competing businesses incentivizing them to reduce prices? Why does this not apply with credit card fees and sales tax

I never drink ginger ale but for some reason always want it when I'm flying. Weird phenomena.

in some cases. it does apply to sales tax. I never suggested otherwise.

There is a competitive advantage to being a business in a jurisdiction without sales tax or in one with a lower sales tax than nearby jurisdictions.

I'm not sure what you mean by businesses competing on credit card fees. These fees are levied by the providers and all merchants are price takers per the Durbin Amendment as I understand it.

I'm the same way. Also, when I am sick.

Does flying upset your stomach?

If it cost a store $95 to sell you a product for $100, do you think the price would be reduced if it began to cost the store $90 to sell you that product?

lol

as opposed issuing a few TRILLY to ease credit supply but which was mostly used by banks to repair their balance sheets which got into that state via GAMBOL GAMBOL

the consequences are so vast mannnnnnnnnnnnnnn

What's the drunkest you've been on a flight? When me and a friend flew from Australia to New Zealand our flight had like 15 people on it and the flight attendants seemed to like us and brought us doubles time and time again. I think I had like 10 shots worth in a 3 hour flight. Then (once our other friend was released by airport authorities because he "accidentally" brought a nugg of weed on the plane in his pocket and stuck it in the magazine pocket of the seat in front of him, the drug dogs went ape**** on him in Auckland) we proceeded to break the table in our rented RV and had to "coerce" a transient to give back some stolen shoes when we illegally parked for the night in a beachfront public park. Is it Wednesday yet?

Not unless demand for the product at $100 decreases.

If a store(call it Store A) reduced their price to $95, do you think no other stores would also reduce their prices? What do you think would happen to Store A and Stores B-Z in this scenario


You are essentially arguing both that sellers don't care about costs and buyers don't care about prices and thus fees associated with this transaction have no effect. I don't even know what to say man, but I'm content with no longer discussing it.

I've been reading and here are some things that have become clear to me:

1. Swipe fees are certainly passed on to consumers to a degree*

2. When swipe fees decrease, as they did on higher ticket items due to the Durbin Amendment, the savings are usually not passed through to the consumers and merchants just capture additional margin. Thus, if we were to remove swipe fees, I do not believe we would see lower prices.

3. The most significant portion of a swipe fee goes to covering the credit card company's cost for reward programs. By forgoing the use of good rewards programs you are lighting money of fire.

*It still remains unclear to me whether these passed through costs outweigh rewards offered by credit cards, but the swipe fees are a sort of implied regressive tax due to who has access to reward cards. I am inclined to believe that rewards from CCs often outweigh the increased costs.

Are you assuming all stores have the same costs? Because, yes, if the cost for each store went down, it would be a slow crawl downward in price. If only one store saw its cost decrease, it might go 99 and win customers from stores that can't match.

CDL #1 is what I already said. All costs are shared by some degree to business and consumers. The proportion is due to the elasticity.

If store A decreases their prices then stores B-Z likely follow to compete and capture some demand. If the cost simply falls and no store makes a move to compete on price then they can all enjoy the fruits of the cost savings. This is why price fixing is illegal, but if you can effectively legally fix prices without communicating your intent and thus breaking the law then you will all be more profitable and the pie will be larger.

You are making the assumption that someone lowers their price. I am saying that that is a disturbance to the status quo and is a completely different scenario than the one I was discussing. If you change other variables then of course that has an effect.

What do you think happens if no store lowers their price? Would no one buy the good anymore? How would demand change?

The 2p2 app is back in top form, if anyone was wondering.

I agree with both of these points and I think you're right on the elasticity point.

However, I would like to point out that price competition is not a certainty in all goods. There are opportunities for costs to decline while prices rise. Price wars are almost always bad for merchants and good for consumers, but if there is no price competition then stores can capture excess cost savings in margin. This is most commonly seen in brands that have the ability to set prices at MSRP and hold retailers to those prices. When that happens the brand can assure that they make a constant margin on their items regardless of input cost declines and the stores also make constant margin that will not suffer from erosion resulting from price wars.

I was in first class on a flight from Charlotte to New Orleans returning from the Virgin Islands, which was maybe a 2 hour flight after a bit of drinking during a layover there. Flight attendant puts down doubles of what everyone ordered (there were 6 of us, all regular drinkers) and literally let us get below 2 drinks the entire flight. Polished off one bottle and were ready to open your second? Here's another in reserve. Drank about half your drink? There she was with some more ice to top you off. Probably 8-9 drinks in two hours, all of us were just absolutely slaughtered.

Upon landing we called a limo to take us to a BBQ restaurant then to our various homes. I had to take a friend back to the airport the next day to get his car. I have no idea what got into that flight attendant angel lady, but she was seriously motivated to give away some booze.

few things more AIDS than people who don't really understand economics talking about economics. this is the whole "just educated enough to be dangerous" thing at its finest.

as if it needed to be said, yes, paying for govt programs with printed money would be a horrifically poor idea.

Speaking of AIDS, Charlie Sheen

Umm, government programs are paid for with printed money. I agree the FIAT money system is a horrifically poor idea if you aren't connected to the sham.

i thought a FIAT was that tiny ass car the LADIES love

lol gjge danny ocean

dogma challenged so other persons must be wrong, proceed to condescension