Latest "fair trade" doctrine: Businesses can't ever increase prices.
or,
Businesses cannot pass along their cost to customers. Or, they can pass along anything but LABOR cost, which magically cannot be passed along like all other costs because labor cost is consecrated with Holy Water making it immune to being passed along like all other production costs.
FAIR TRADE to whining worker: Oh you poor victim! Let's guilt-trip your employer into raising your wage = higher cost of production = higher prices consumers have to pay = higher cost of living for all.
<<snip>>
This is the core of your argument. And you are wrong about this.
Higher wages don't result in higher prices. Higher wages result in lower profits.
You mean ALL higher costs result in lower profits but no higher prices? You mean a seller NEVER increases his price when his cost increases? Just the profit decreases and the price always remains the same, no matter what cost goes up for a seller/producer?
So, when the price of gasoline went up, back around 2008 or so, no stores increased their prices as a result? no truckers increased their prices to companies they delivered to? You don't remember that there were many price increases for a time, and it looked like we had some inflation again?
Or you think there is something magical about labor cost, such that whenever labor cost goes up, the producer always takes a cut in profit and never raises price? while for all other cost increases the producer does increase prices?
There's a term for that notion: Wacko Retard-brain Childish Crybaby Idiot Economics. What kind of mentality would insist that for any cost increase the producer does raise the price,
EXCEPT for LABOR COST only --
wages -- in which case the prices are never raised? You have to be a nutcase to think that.
How do you think that prices are set?
Always to maximize profit
long-term, no matter what the changes are in the production. And of course the producer/seller can miscalculate on how much to increase price, or what other adjustments to make. They might restrain price in some cases, hoping the cost will go back down. But they always put the price where needed -- sometimes higher -- to maximize long-term profit. If the cost goes up, with no other change, then something has to give, and higher price is inevitably a choice which is made, as needed to prevent the profit from falling as much. Minimum loss of profit/revenue is always the goal. If you can't see that this must mean higher price as part of the solution, then you need to go back to the 1st or 2nd grade to learn some arithmetic.
I.e., Profit = Revenue minus cost. Like 4 minus 2 = 2.
Who do you think sets prices?
The Great White Pumpkin.
Your claim above indicates that you believe that a business can raise prices any time it needs to.
It always raises prices when necessary to maximize long-term profit and according to its ability to calculate the correct amount. And the delay between the cost increase and the price increase varies according to many circumstances. There are reasons to not do the price increase immediately, especially if the cost increase was unexpected or the future is unpredictable. If the cost is likely to go back down, then maybe it won't increase the price. There are reasons to keep prices steady rather than raising and lowering them erratically.
Just because there are many different factors pushing costs/prices up or down doesn't change the fact that overall cost increase leads to price increase. This is a general description of the causal connection over time, not a day-by-day description of the prices jumping up and down constantly with every minor change going on. If several employees get sick on the same day, causing a disruption, that can mean higher cost, but that doesn't mean the prices are all jacked up for a day or 2 and then go back down when it's back to normal. This is about long-term causation of cost toward price.
So then, at the supermarket the price of produce never goes up according to changes in the cost or the supply.
A business is constrained by the market from raising prices.
So no prices ever go up? Or, no business can ever raise its price unless the whole "market" goes up together, i.e., all of the prices for all sellers increasing only together simultaneously?
I was only kidding about the "Great White Pumpkin," but you apparently believe there is a Great Price Setter in the Sky who reaches down into all the markets and sets the prices at the same level for every seller, so that no single company ever increases its price above the Universal Level set by the Great Cosmic Price Setter.
This is a good place to note that all the arguments claiming "fair" trade is better than "free" trade ultimately have to fall back onto some kind of Wacko Nutcase Economics in order to try to make any sense. The "fair" trade theme in one way or another is always to demand higher wages, above market supply-and-demand, but this is always based really on Crybaby sentiment only, or the impulse to pander to wage-earners generally and scapegoat employers who are an easy target. And then to provide a rationale for this, the panderer has to hallucinate some kind of Economics philosophy to make sense of it, and so comes up with nutcase arguments, like in this case saying businesses can't ever increase their prices.
One way or another, it's always some kind of nutcase wacko theory which denies the reality of supply-and-demand and the need for competition and profit-motive incentive to create better performance by producers. And so disregarding the need for good performance by producers, the panderer hallucinates that production somehow automatically happens the same, no matter what, and so all that matters is to feel sorry for wage-earners (majority of producers), which is popular and wins applause from the mob -- and so in the end it all boils down to just a popularity poll of winning this applause from the idiot masses.
