Comments on: Falling Sales, Rising Prices

By: Mark

Mark — Thu, 07 May 2009 17:48:07 +0000

Some data to back you up, Julian: In 2001, the Washington Post charged $0.25. It now charges $0.75 – a 200% increase.

In that same period, the paper has lost 17% of its circulation (and who knows how much of that loss would have occurred even without the price increase). It’s even possible that the Post has cut its ad rates by less than 17% because it can now claim to deliver a more engaged audience.

If anything, newspapers should probably be raising prices more.

By: CaptBackslap

CaptBackslap — Tue, 05 May 2009 00:28:36 +0000

Ah, another top-quality Duke education, I see.

By: chrismealy

chrismealy — Mon, 04 May 2009 07:40:06 +0000

I’m assuming JS is talking about the situation where your product isn’t changing, but everyone else’s is, so the nature of you product is becoming more of a monopoly.

Whatever it is, the lower right hand triangle of the demand curve disappearing fast.

By: andthenyoufall

andthenyoufall — Mon, 04 May 2009 05:35:54 +0000

It’s called “monopolistic competition”. I think cereal is the classic example. If raisin bran is the only cereal you’re dealing with a normal supply and demand curve, but when there are fifty different kinds of nearly-identical cereal, your remaining customers really, really like something about your raisin bran in particular.

By: chrismealy

chrismealy — Sun, 03 May 2009 02:29:08 +0000

That’s a great question. Economics is mostly interested in “how much?” and “what price?” but not so much “what kind of thing?”