DanielLC comments on Bargaining and Auctions - Less Wrong
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Comments (70)
I think it might be important here that the dealer has to do this many times. Yes, sometimes he will need to take a loss on an item to free up inventory space. But for any particular item, if it doesn't sell it is more likely that the right buyer just wasn't present. If a dealer consistently follows the policy of ignoring his purchase cost, the result is that he goes out of business.
If the dealer has other people he could sell it to, it's an auction, not a bargain.