Full text: Price Takers' Plenty in a Model of Pure Capitalism.

frequent introduction of improvements and new models to meet and anticipate 
buyers' desires, attractive displays, pleasant surroundings, easy terms of 
purchase., the provision of ancillary services to ease the task of shopping, 
great politeness, and discriminatory price concessions in the form of special 
sales, discounted prices through special outlets, special rates to new 
subscribers, etc# 
Most of us take for granted those consequences of the price-maker 
price-taker relationship, because they are part of our everyday experience; 
but they are the features of our economy that usually impress economists and 
other visitors from communist countries the most — and rightly so because 
they undoubtedly are an important benefit of capitalism, which, incidentally, 
would not exist under perfect competition or a realistic approximation to it# 
Needless to say, the cost to the price maker of the fringe benefits he 
provides must be smaller than the extra profit he hopes to make by exploiting 
the price takers so attracted; but from the price takers' point of view, their 
value may well exceed the price they pay for them by paying more than the 
perfectly competitive price for goods bought. Indeed, the extra profit the 
price maker receives in exchange for the fringe benefits he provides can be 
looked upon as a secondary transaction, separate from the primary transaction 
it accompanies but linked with, it in a package deal. Because it is so linked, 
the fact that it has been concluded would be no proof of its having been 
mutually beneficial if it weren't for the possibility, in recent years, to 
separate the two transactions. The emergence of discount stores, which sell 
the same goods at a lower price but without the fringe benefits, has enabled 
consumers to conclude the primary transaction without also taking the

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