Out of the Crisis.Org

[Louis Altazan]

The pricing of most things is based on two general factors. The desirability or need and the difficulty of obtainment. For instance, many find diamonds desirable, though they have few practical purposes. Diamonds are also difficult to obtain, thus the high price. Water is highly desirable, yet relatively easy to obtain thus a low price.

This applies as long as situations remain constant. Change the situation and the value quickly changes. For example a person in the desert and dying of thirst would quickly trade diamonds for water. Need has changed desirability. Obviously an extreme example, but the principles apply.

Doctors are paid a good deal of money. This because the results of their service [lack of discomfort] is seen as very desirable and it takes many years to produce a doctor, so they are somewhat hard to obtain. Some of this is due to ability and some is due to restrictions imposed. Not everyone who is qualified might enter medical school.

Another example might be an actor. Their skills [entertainment] are seen as desirable. Obtainment is difficult, not so much because people lack the ability, but those given the opportunity are limited. For those that do obtain the status, wages are generally high.

A good automotive technician is very difficult to obtain. Why then are their wages relatively low, in comparison to their skills? Is it that their service is seen as undesirable? Clearly the things society values are not always based on actual value. Rather society seems to work with perceived value — entertainment is valuable auto repair is not. Obviously this changes with the situation. As with our diamonds in the desert, a person with a broken vehicle values auto repair much higher. Yet as the situation reverts, so may the valuation.

Many other factors also enter into this perception. The quality [results] of the service, the appearance of those that provide the service and the cost of alternatives, among other things. Considering these three, two are readily addressable by those in this trade. Value is based largely on perception and perception is based largely on example?

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Louis Altazan
Owner/Manager AGCO Automotive Corporation
Baton Rouge, LA