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Posts: 16 | Thanked: 1 time | Joined on Dec 2009 @ Paris, France
#270
Originally Posted by ysss View Post
What's all this material and marginal costs gotta do with the item value anyway?

As long as someone thinks they can get enjoyment or benefit from your service or product, then it's worth something to them and worth paying for.
Sure.

As far as I'm concerned, many times I've paid for some intellectual product.

But for the same reason that someone might think that something has some value that worths paying for, he might also consider that this thing deserves to be known and owned by others.

That's where zero marginal cost intervenes.

Since it doesn't cost anything to duplicate and distribute what he's just bought, he might very well decide to just do it, for free.

Marginal cost is something that tend to influence price in time. This is dynamic process. Eventually, the price of a zero marginal cost product tends to zero.

There is no such thing as intrinsic value for a product. It always depend from local situation and global economic environnement.

This is what marginalism has illustrated with the water and diamond paradox.

A man in a desert would give any diamond for a glass of water. But he wouldn't give that much for a second one, even less for a third, and so on.

Pricing is a complex and dynamical process. This should not be ignored.

Last edited by azorni; 2010-03-05 at 05:44.