Capitalism is why we have such nice things!... Nah, that's just why they cost so much.

Noah Silverbrook

Updated Tuesday, September 19, 2023 at 12:01 AM CDT

Capitalism is why we have such nice things!... Nah, that's just why they cost so much.

Discover the fascinating impact of capitalism on the prices of everyday items. From luxury goods to basic necessities, find out why capitalism is both a blessing and a curse for consumers.

Have you ever wondered why some things cost so much? Or why certain products are considered luxury items while others are more affordable? The answer lies in the economic system we live in: capitalism. In this article, we will explore the fascinating relationship between capitalism and the prices of our favorite things.

One of the most significant impacts of capitalism on consumer goods is the concept of supply and demand. When a product is in high demand but limited supply, its price tends to skyrocket. Take, for example, the latest smartphone model. Companies purposely create a sense of scarcity by releasing limited quantities, which drives up the price and creates a sense of exclusivity. Capitalism thrives on this principle, allowing companies to maximize their profits by capitalizing on consumer desire.

Luxury goods are a prime example of capitalism at work. Brands like Louis Vuitton, Rolex, and Gucci have built their entire reputation on exclusivity and high prices. These luxury items are often made with superior craftsmanship and premium materials, but their astronomical price tags are also a result of their brand value and the desire to maintain an air of exclusivity. Capitalism allows these brands to charge a premium for their products, catering to a specific market segment willing to pay for the status symbol.

On the other end of the spectrum, capitalism also affects the prices of basic necessities. While capitalism has undoubtedly led to advancements in technology and increased efficiency, it has also created income disparities. This means that some people can afford to pay more for everyday items, while others struggle to make ends meet. As a result, the prices of basic necessities like food, housing, and healthcare can be disproportionately high for those with limited financial resources.

However, capitalism also fosters competition, which can drive prices down. When multiple companies offer similar products or services, they are forced to lower their prices to attract customers. This benefits consumers by providing more affordable options. For example, the smartphone market is highly competitive, with various brands offering similar features at different price points. This competition encourages innovation and affordability, making technology more accessible to a wider range of consumers.

In conclusion, capitalism plays a significant role in determining the prices of the things we buy. It drives up the prices of luxury goods, creating a sense of exclusivity and catering to those who can afford to pay a premium. At the same time, capitalism can also lead to high prices for basic necessities, particularly for those with limited financial means. However, competition within a capitalist system can also drive prices down, making certain products more affordable for a broader audience.

Next time you're browsing the aisles or considering a big purchase, take a moment to reflect on the impact of capitalism on the prices you see. It's a complex system with both advantages and disadvantages, but understanding its influence can help you make more informed decisions as a consumer.

View source: Imgur

Top Comments from Imgur

lamontcranston ( 381 upvotes)

All the technological R&D in smart phones was funded by the government, usually via the military. And also that labor assembling them in China is kept cheap by the government protecting near-slavery conditions.

glovelyday ( 294 upvotes)

In fairness, Capitalism does foster innovation. The problem is it also fosters inequality. The challenge is to strike a balance. Unfettered Capitalism is disastrous. Regulation is essential to a funtioning society.

literallymike ( 163 upvotes)

Capitalism charges people $1200 for a phone they expect to replace with a near-identical model a year later.

TresusIbor ( 67 upvotes)

Labor made my phone. Capitalism made it break easily.

Plagen ( 7 upvotes)

My favorite pro-capitalism thing is "Well, if we didn't have capitalism no one would be motivated to invent/innovate/be a doctor/ etc". Except most times people do any of that is because they just thought, "I want to do this" not necessarily "I want to do this to get money".

RealScienceMan ( 9 upvotes)

Yea, the idea behind that statement is that capitalism encouraged the innovation behind your phone, but what major things were innovated by private companies? Personal computers, maybe? Sure private companies do a decent job at small improvements on what's already there, but public research and military applications are where things get made.

Superchief86 ( 4 upvotes)

Man, I hadn't even noticed that Arthur had disappeared from Twitter. I don't blame him.

DavedandConfused ( 4 upvotes)

The problem with capitalism, is that blinding greed can soon drive the innovators. Soon, money is the only incentive and innovation no longer matters. Nothing else matters, and soon the workers (who got you there) are exploited and the environment is exploited, until there is nothing left. Capitalists, who are too greedy burn down everything they built and leave the world worse off.

nblizzar72 ( 6 upvotes)

Capitalism is what makes them obsolete after 2 years

zoeytg ( 2 upvotes)

I love free speech. People say the quiet part out loud. The rich don't just hide how they really feel.