Every time price complaints come up we get a bunch of people saying "thats just the free market". As if prices are some kind of wildly unpredictable thing that cant be discussed quantitatively. Its frustrating, when people insist that "the price is whatever people will pay". Its deliberately refusing to engage with the question; it's circular, defining the price as the price and refusing to think about WHY that is the price.
Lettuce doesnt sell for $20k and cars don't sell for $1.99, and I don't need to ask buyers what they'd pay in order to know that.
In a mature market the prices approach the cost of production plus a small amount of profit. This is as close to a Law of Nature as you will find in economics.
In markets that are distorted by regulation, a lack of transparency, or the actions of monopolies, the prices are much higher than that. For a while, usually early in the development of the market. During this period, the prices are *objectively* too high. Even if someone pays them, they are too high. Because what is meant by "too high" is not "no one will pay it". What is meant by "too high" is "much higher than the cost of production plus a reasonable profit".
After those distortions are removed, prices correct. You've seen it with other corals. They sell for $500 initially then after a year or two theyre selling for $50. That is a price correction. The initial price was wrong. Distorted. Too high. Over the market life of the item, most will sell for the correct price. Only during early distorted periods in the market will they sell for a high price.
As for the ethics of the situation. Like most ethical questions it is unlikely everyone will agree, and we probably shouldnt expect that.
Is it right for a vendor to take advantage of the temporarily high prices? Should they take the money while they can, out of a fear of missing out on potential profits? IMO such a perspective ignores where the money comes from; the vendor profits directly at the expense of the customer. Surely it is ethically better to charge your customer a reasonable profit rather than the maximum possible profit.
I suggest an ethical goal here should be this: if the buyer and seller both had full information about what the item cost the seller (wholesale + fair overhead), they'd agree the selling price was fair.
On the other hand, no reasonable code of ethics would compel vendors to sell themselves into bankruptcy. Profit is necessary and good and literally feeds families. Wholesale cost, lease and utility costs, and local cost of living all contribute to determining reasonable minimum prices.
Theres a wide range of prices between the minimum needed to keep the seller in business and the maximum someone will pay. I argue that yes, absolutely, there is an ethical dimension to the seller's decision where to set there prices, within this range.
But its very unlikely everyone will agree on the answers to this question, like any ethical question. Some will see it as their duty to maximize profit, and foolish to "leave money on the table". Others will see it as their duty to not overcharge their customers, and would feel guilty for overcharging the buyer.
