Efficiency of markets is like the Law of Large Numbers. But it's possible to get n consecutive coin flips that come up heads.
169 karma · joined April 4, 2012
Efficiency of markets is like the Law of Large Numbers. But it's possible to get n consecutive coin flips that come up heads.
You will note how many Western governments over the past few days have been saying explicitly: "These sanctions are not meant at the Russian people, we see that they did not want this war". It doesn't seem like this is even true from polling, but it's calculated messaging, and it's important.
The topic of discussion is not whether or not the Russian invasion of Ukraine is bad. If it was, your argument would be applicable.
This topic is analogous to "selective enforcement" from police. If a policeman typically jails blacks but gives whites a warning for the same crime, this is bad, and should be acknowledged as such. Same here.
This is obviously a very sensitive topic at this time, and I hesitate even to post this comment. But I think everyone should be free to draw their own conclusions.
There is also a big difference between one person's voice on a platform, and a decision-maker of the platform who is creating policy/process for filtering those voices.
- The fake reviews are commonly very low-effort: "best I've found, gift for grandma".
- A seller looking to do review spam doesn't want to keep pumping fake reviews forever. It costs money, and it's a risk.
Taking these two things into account, I sort for recent reviews, and only consider <5 star reviews OR reviews with some meat on them.
From the manufacturer's standpoint, they pay 15% referal fee to Amazon for getting them the sale. They also have a 5% coupon. Taking both of those things into account, their revenue on the sale is ~$64 compared to the ~$54 on their site. But I'd wager they're not getting very many sales on their website.
> Even though some competing platforms charge much lower fees, if Steve lowers his prices on another shopping site, Amazon’s algorithms punish him
I think in most cases, this "fair-pricing" bot kicks in because a seller has instead inflated prices on Amazon to squeeze more profit from Amazon customers. Amazon thinks that such tactics diminish the value of their marketplace, so they apply this crude heuristic as a way to disincentivize it.
So to answer your question: it's good for you, because if you're shopping on Amazon you can reasonably expect that you're getting good prices (at least in theory). This leads to a virtuous cycle which feeds the beast: people buy more stuff from Amazon, Amazon can operate more efficiently, you get lower prices.
Steve is griping against Amazon, but quite possibly he just has a bad business, and the core of his problem is that he can't compete effectively with other sellers on Amazon. But to him, Amazon seems like the problem because he feels like he's between a rock and a hard place.
But, hypothetical harm aside, Amazon (FBA especially) is currently a really good deal for sellers in terms of shipping costs and access to customers.
If Steve wanted to sell through a traditional retailer, he would wholesale to them and they would set the price to whatever they want.
Amazon's model is different, but not really. Imagine Steve could come in to negotiate a wholesale price with an Amazon rep.
Amazon would say: "Steve, we want to have the lowest prices in the marketplace. We checked 10 other stores, and the lowest price we found is $10. So, if we make a deal today, that would have to be our retail price. Now, working backwards, if we subtract our profit margin and expenses, the best wholesale price we would buy at from you is $3. Take it or leave it."
Also, what are these competing platforms charging much lower fees? In any case, if you're not profitable selling at the lowest price on Amazon, you don't have to sell on Amazon. You can go to these other platforms, or set up your own website. And the reason you won't want to do that is because actually Amazon offers a lot of value both to sellers and customers.
Suppose there are two people at two corners of a dark alleyway. They both hear a gunshot towards the center of the alley and draw their pistols in self-defence. They take a few steps and now see each other holding a gun. Each one raises his gun at the other, thinking that's the shooter. One fires and kills the other. AFAIK it would be justified self-defense
The point that I'm making is that the distinction is dwarfed by the baseness of the paradigm itself: politically motivated interference with airliners in flight, to force a landing and arrest people in transit who are currently not within your jurisdiction. Anyway you want to look at it this happened in both cases, and we shouldn't be celebrating "ooh, but technically, we just withdrew permissions so it's not that bad is it?"
I could also say that "being a whistleblower about a government agency violating the rights of millions of it's citizens" is something that Western democracies claim to protect, when it's not happening to themselves.