Quote:
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Originally Posted by Caffeine
There are two questions here:
1. Do consumers care where the luxury goods are produced?
2. Should the luxury companies reduce their price?
The answer to the first question is personal. I don't care, but I believe most of the people do look at the tags.
the second question is more like an economics question though. I'll think it through before I make my conclusion  |
As an economics question:
The most allocatively and productively efficient system is PC. Firms in PC do not have ANY profit margin above normal profit. The fact that luxury companies are able to not lower their prices shows that they are inefficient and exploit monopoly power (because they do have a profit margin).
Yada...