Greed Isn't The Issue

I tend to roll my eyes when people blame a high price on corporate greed. It's especially roll-worthy when these same people go comparison shopping on sites all over the world to get the lowest price for something.

A transaction has two sides, each side trying to get the best deal. For the buyer, it means getting the most product for your money. For the seller, it means getting the most money for your product.

It's terribly hypocritical for a person on one side of the transaction to maximize their return (say, by comparison shopping), but denigrate a seller's effort to maximize by charging what the market will bear. I'm not talking about defrauding people. I'm just talking about charging what people will pay.

People engaged in economic activity will try to make sure they get the best deal they can reasonably find, or at least will choose transactions they think aren't ripoffs (which is the same thing). That way, when both parties agree on a sale, both feel like they are better off for having made the transaction. One party wanted the item more than their money, and the other wanted the money more than the item. So they exchanged. That's how it works.

It's one of the beautiful symmetries in life that it works the same no matter which side of the transaction you're on. The fact that each person feels they've gained by the trade is why it works. Mutual exchange for mutual benefit is the basis for specialization and a society with all our modern conveniences. And I like modern conveniences.

So the real issue isn't "greed" at all, since that would describe anyone trying to get the most for their money as well. A proper morality is not some naïve and self-contradictory altruism. Blaming anything on "greed" is a sign that a person needs to work out a better moral understanding of themselves and the people around them.

econ
Posted by Steve on 2012-05-29 23:14:00