The Market Works as Shop Closes
Ed Morrissey over at HotAir.com found an interesting story about a shop going out of business. Apparently, Don Otto’s Market was run the same way politicians treat their citizens. The result was predictable and the business failed in about 6 months.
So what was unique about Don Otto’s?
Well, the owners charged over $8 for eggs, and $28-per-pound of steak. Then when the customers refused to purchase the food at that price, the owners blamed the customers for their lack of loyalty, and understanding about “food quality.” Amazingly, the owners were shocked to think that the price on particular food actually translated into customer purchasing decisions. A quote from a few months ago explains the owner’s naivete:
Eggs, from free-range chickens, are $8.50 a dozen. When asked whether people will balk at the cost, Otto shrugs and explains these chickens’ laying routine. “Their lay cycles rely on the sun, not on artificial lamps that distort production,’’ he says.
So here is a clear example of the free market working. Citizens did not want a particular product at the price that was offered. As long as the shop stayed open, the business was wasting resources. Once the business closed, resources could better serve the public in other sectors of the economy. The sad thing is that had Don Otto’s been a car company, the government probably would have bailed it out already.