Kind of back to my OP, what if the seller has apples that are worth 1 (that is the price this kind of apple sells for in the market) but he use advertising (which costs .25 an apple) to make people think his apples are better even though are the same.* Because his ad campaign he now sell his apples for $2.50. Is this seller exploiting the buyers of his apples?
*Suppose he is a middle man who gets his apples at the same place as all the other sellers.
I would hesitate to call it exploiting without some evidence that something actually nefarious was happening. If, for instance, he claimed that his and only his apples cured cancer, or grew hair (or other appendages), or brought good luck, then I could see making a case that he had immorally raised the price through a sort of fraud. If, however, he simply was able to sell the apples at a higher price because they had his name on the bag, then I’m not sure you can make the claim that he has exploited anyone. The question is complex, because it brings up the fact that neither buyers nor sellers really have perfect knowledge of the entire market. It is what makes the sort of thing I think you are refering to possible. Some people will pay the extra price because they mistakenly think those apples are better. But unless his advertising promised something which is demonstrably not true, I’m not sure the word exploitation is waranted.
For instance, suppose that he gets the apples from the same source available to all of us, but he takes the time to go throught he pile and only pick out the juiciest, blemishlessest, or biggest of the apples available. You could do that too at the common source, but perhaps you’d be willing to pay him a little extra to have his assurance that he had done this work for you. I suppose I’ve changed the hypothetical to the point where he has now done extra work. I realize this is not what you are asking.
Let’s the ad was a very attractive and famous woman saying I would only eat Brand X apples. Let’s further say that Brand X apples come from the same supply as the other apples in the market and this seller takes no extra steps to assure higher.
Are the people buying Brand X being exploited?
And to change it further let’s say that in slightly different scenario that there is another seller (Brand Y) who does inspect the apples for quality and only sells the best apples but because he has a smaller operation he can’t afford to smart advertising.
Are the people buying Brand X apples at $2.50 instead of Brand Y at $1.00 being exploited? How does the market adjust/correct for situations like this? Does the market adjust for situations like this? Should the market adjust for situations lke this?
The effort a consumer would expend investigating the sellers and determining that the Brand Y have higher quality goes to offset the price. If it’s “worth” less than the $1.50 difference, more people will buy Brand Y and Brand X will have to lower its price.
A more realistic example (not that this doesn’t happen for other products than apples) is illustrated by coupons. If someone finds the effort involved in finding, clipping, saving, and presenting the coupon for apples worth the $1.50 savings it offers, they’ll do it. If they don’t, they won’t. Are the people paying $2.50 because they don’t have a coupon being exploited? Hardly.
Which is exactly why new industries form. People don’t want to die, so they start their own little venture.
I have composed several posts in response, but I think the final verdict is that we aren’t using the same terms in the same way, pervert. This makes communication impossible.