Comments on: Is Deflation Really That Bad? http://sandykory.com/2009/01/08/is-deflation-really-that-bad/ Sat, 14 Mar 2009 22:54:49 +0000 http://wordpress.com/ hourly 1 By: ShyamS http://sandykory.com/2009/01/08/is-deflation-really-that-bad/#comment-4 ShyamS Sat, 10 Jan 2009 16:18:02 +0000 http://sandykory.com/?p=37#comment-4 I'm no expert but it seems worth considering that there may in fact be specific reasons that buyers purchase technology today knowing that prices will decrease in the future (and then seeing if those arguments would hold true for say, shoes). An economist might argue that the reason people buy technology is that the opportunity cost of not buying it today would outweigh the value of deferring the purchase. This is certainly an argument that doesn't hold true for large classes of consumer goods. I'd argue that even large swaths of consumer discretionary technology purchases will be deferred on this basis. I’m no expert but it seems worth considering that there may in fact be specific reasons that buyers purchase technology today knowing that prices will decrease in the future (and then seeing if those arguments would hold true for say, shoes).

An economist might argue that the reason people buy technology is that the opportunity cost of not buying it today would outweigh the value of deferring the purchase. This is certainly an argument that doesn’t hold true for large classes of consumer goods. I’d argue that even large swaths of consumer discretionary technology purchases will be deferred on this basis.

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