Below is a quote from a news item in the Washington Post by Casey Quackenbush, August 15, 2019. It’s titled “A Run on Gas Masks: Hong Kong protestors circumvent crackdown on protective gear” and is quoted in Liz Wolfe, “Hong Kong’s Market Is Providing Gas Masks and Protective Gear Despite Government Crackdown,” Reason.com, August 16, 2019.
At big protests, [Lee] rents a stall nearby and sells packets containing an eye mask, respirator, gloves and helmet. The packet costs him about $64, but he sells on a pay-what-you-can basis. The student price is $1.27…At a recent protest, Lee said, about 20 police came to his stall looking for ‘laser pens or other dangerous goods.’
He packages his supplies in black plastic bags. That way, protesters won’t get stopped on the streets, and if the police want to know what’s inside, they need to buy it. He said he charges government staff about 1,000 times the student rate.
‘This is my business, not the government’s,’ he said.
READER COMMENTS
Matthias Görgens
Aug 17 2019 at 3:49pm
Nice illustration that maximising profit is just the standard goal for economic actors, but not the only one possible.
David Henderson
Aug 17 2019 at 4:13pm
Good point, Matthias. Also a nice illustration that letting people be free to make their own decisions often leads to better outcomes than those that market critics imagine.
Mark Brady
Aug 17 2019 at 4:42pm
Kudos to Matthias for his comment and to David for his reply. In fact, I suggest that it’s not what is meant by price discrimination.
David Henderson
Aug 17 2019 at 5:18pm
You wrote:
Thank you.
You wrote:
Meant by whom? Price discrimination is generally defined as charging different prices to different people for the same item. This case fits the definition. There is no implication that it has to be profit-maximizing.
Mark Brady
Aug 17 2019 at 10:42pm
Price discrimination is more precisely defined as charging different prices to different groups of buyers where the difference in price is not entirely explained by a difference in cost. Yet clearly the (subjective) difference in cost to the seller does give rise to the difference in price. I submit that the concept of price discrimination doesn’t do justice to what is going on here.
David Henderson
Aug 18 2019 at 3:56pm
Good point.
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