[Vision2020] Gas prices...........

[lfalen]

I don't think you are quite right. Supply and demand still play a part in gas prices. There are other things that do play a part such as high gas taxes. Other people such as Jeff Harkins can give you a more detailed explanation. You might also check the web sites for Thomas Sewell, the Cato Institute The Milton Friedman Foundation or the Heritage Foundation.
Roger
-----Original message-----
From: Kenneth Marcy kmmos1 at verizon.net
Date: Thu, 07 Aug 2008 08:48:40 -0700
To: vision2020 at moscow.com
Subject: Re: [Vision2020] Gas prices...........

> On Thursday 07 August 2008 08:29, Tom Ivie wrote:
> > I still don't understand this free market thing. Can someone explain how 
> free market works with these gas prices?
> 
> A free market does not work with gas prices because there is no free market 
> for gasoline. What does exist for the gasoline market is an oligopoly.
> 
> Two paragraphs from Wikipedia:
> 
> A free market is a market in which prices of goods and services are arranged 
> completely by the mutual consent of sellers and buyers. By definition, in a 
> free market environment buyers and sellers do not coerce or mislead each 
> other nor are they coerced by a third party. In the aggregate, the effect 
> of these decisions en masse is described by the law of supply and demand. 
> Free markets contrast sharply with controlled markets or regulated markets, 
> in which governments directly or indirectly regulate prices or supplies, 
> distorting market signals.
> 
> An oligopoly is a market form in which a market or industry is dominated by 
> a small number of sellers (oligopolists). The word is derived from the 
> Greek for few (entities with the right to) sell. Because there are few 
> participants in this type of market, each oligopolist is aware of the 
> actions of the others. The decisions of one firm influence, and are 
> influenced by the decisions of other firms. Strategic planning by 
> oligopolists always involves taking into account the likely responses of 
> the other market participants. This causes oligopolistic markets and 
> industries to be at the highest risk for collusion.
> 
> 
> Ken
> 
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