Tossing and Tortured 'Till Dawn

I come back to you now, at the turn of the tide.

Monday, March 06, 2006

eBay is a beautiful thing.

When I first saw this "online-auction" site more than five years ago, I wondered how it could succeed.

But, with a few simple rules, eBay has become a household word and a wonderful method of both increasing and reducing waste.

Have you ever been to a garage sale? Sure you have. Ever had one? Well, maybe your folks did.

But in this digital world, lots of us have little gizmos that were relatively expensive and aren't terribly heavy. Shipping has gotten faster and more reliable. Paypal is one of the Most Brilliant Ideas about the internet. Some whinge about it charging to receive payments. What? Well, it charges to receive, but not to send, and a maximum of about 3 percent. That's less than a credit card provider will charge a small retailer. It means that ANYONE can sell just about anything, and receive their payment for it instantly.

I moved, recently, and found a few things that wouldn't do me any good in boxes. A copy of The Two Towers extended version, still sealed in its original packaging. Sold it for 25 dollars within two hours. A battery pack for a device I no longer owned. 15 dollars. A bunch of ammunition for an Airsoft toy that had broken. $7.99.

Economists have long mused about the effects of "perfect competition." It has conditions that people believe basically impossible, including:
  • No Barriers to Entry
  • Goods are indistinguishable and Perfect Substitutes
  • Consumers have Perfect Information
  • Many Small Sellers; No Monopoly or Oligopoly power exists in the market

No, Ebay is not "perfect" competition. One must pay an average of about 6-8% to complete a sales transaction, including eBay's listing fees, Paypal's fees, and eBay's final value fee. It takes time and energy to list items and build up your "feedback rating" as a trusted seller.

Still, it's awfully close, and it's an impressive contrast to what would've happened just a few years ago. All of the stuff I had would've either remained in a box or been thrown away; instead, it can help a college student afford some textbooks.

Speaking of which: how about Half.com, eBay's subsidiary, and textbooks. Every college student has complained about ridiculous textbook prices. For a class whose textbook was sold at my campus bookstore for $105.99, used for $79.99, I bought a slightly battered, previous-edition copy that was completely servicable for $4.99. Ya can't beat that with a stick.

1 Comments:

  • At 3:12 PM , Anonymous Anonymous said...

    hey...this be ebola/andy (clearly).
    You, er, moved to Washington without mentioning anything.

    Anywho, I hope things are going well up there at U-dub and what-not.

    ---andy

     

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