Dear PENners: I am circulating the following exchange to enter it
into the current running shoe controversy. Cheers, <Tom Weisskopf>
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Message: 32005750, 27 lines
Posted: 5:08pm EST, Tue Mar 1/94, imported: 4:23pm EST, Tue Mar 1/94
Subject: RE: Running further with those shoes
To: Tom Weisskopf
From: [EMAIL PROTECTED]
Sender: [EMAIL PROTECTED]
Dear New Balance Tom,
Wouldn't post Keynesian theory hold that perhaps for large companies to
survive in this globally competitive market, there is a need for
these companies to maintain growth at some specified rate, and in order to
grow they need to generate internal funds to finance their expected
investment or retained earning needs.
Perhaps prices are set at higher rates because its an oligopolistic
pricing strategy which allows firms to retain power (keeping other companies
out). Other strategies to change quantity, advertising, etc
may not work because they would be countered by rival firms, so prices
remain high.
I don't know if I explained this too well, but I find this
theory (by Eichner) to be very interesting and convincing. Plus it provides
a needed prescription for controlling inflation: get "megacorporations" under
some social control. Indeed Clinton was able to do this by "jawboning"
pharm. companies. Prices immediately dropped 30 percent with no apparent
consequences for research and development. Kennedy did the same thing with
steel prices. It essentially forces all companies to lower prices.
So get Bill to lower prices of shoes for us running grad students.
(Personally I prefer the low end Asics and have for 10 years. Even though
I'm sure they are made with cheap labor, I'm a rather loyal customer. Each
pair has probably weathered over 500 miles and they're cheaper.) Does
you know if all that "gel" stuff in the shoes actually works? I've been
thinking of getting a new pair. (New Balance didn't work for me).
In pen-l solidarity,
Heather Grob
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Message: 32039240, Reply to: 32005750, 10 lines
Posted: 9:33am EST, Wed Mar 2/94
Subject: RE: Running further with those shoes
To: [EMAIL PROTECTED]
From: Tom Weisskopf
Heather -- thanks for your comments. The post-Keynesian theory does
have a certain appeal, I agree; but to apply it in this case wouldn't
we have to show that the need of firms for internal funds has risen
sharply upward, so that now they need the much higher mark-ups over
cost that they can realize by reducing labor costs substantially
while holding the line on output prices? What would have raised
their need for internal funds so much? In solidarity, <Tom>
