In today’s economy more and more the supplier and consumer are decoupled by supply chains( example beef, eggs) financing schemes (for example healthcare), managed distribution (electricity), pharma (PBM). Instead of the much feared and destructive government price fixing, we are seeing a destructive corporate (via near monopolies and financial engineering) price and supply manipulation. Free market supply demand curves are being broken.
Not sure why anyone would care, but should the cross in the second figure corresponding to the new equilibrium be green (like demand)?
Fair. I was too fast with AI generating graphs
Huge fan of your writing. Prob should have led w/ that. It’s a great public service.
Man, we have a model for firms that ser prices: It is named “monopolístic competition”, and it creates its own equilibrium.
https://www.foltyn.net/wp-content/uploads/2009/12/dixitstiglitz.pdf
A funny thing: this equilibrium is more general than general equilibrium.
In today’s economy more and more the supplier and consumer are decoupled by supply chains( example beef, eggs) financing schemes (for example healthcare), managed distribution (electricity), pharma (PBM). Instead of the much feared and destructive government price fixing, we are seeing a destructive corporate (via near monopolies and financial engineering) price and supply manipulation. Free market supply demand curves are being broken.