Recklessstudios on Pixabay
The COVID pandemic has had severe impacts on our global economy, but the tech industry specifically has been pushed towards having higher prices for products while continuing to maintain a high demand for them.
Tech is a constantly growing industry with surges and falls in prices because of its rapid innovation. With the pandemic involved, the recent surge of Graphical Processing Units (a computer part crucial for 3D rendering and game development) prices have been pushed even higher due to hindrances in supply production and the recent silicon shortage, a necessary material used in these PC parts.
Senior Matthew Bender shared whether he believes this inflation will continue past the pandemic. “Chips and other tech products are only becoming more necessary as everything we own gets smarter and more advanced, so there’s really no sign of it ending in the near future,” he said.
It is not just society as a whole that demands better tech, but individual consumers as well.
The Manufacturer’s Suggested Retail Price (MSRP) is a price point set by companies to help consumers understand the value of a product in relation to others within a similar lineup. Due to natural inflation and the anticipated hype built up by these consumers, MSRPs have been completely ignored as consumers become more willing to pay for the absurd price rises caused by the scarcity of products.
This situation has gotten even worse because of the pandemic’s influence. Scalping, a term commonly associated with sporting tickets, is when a consumer buys a product ahead in the hope of reselling it for a higher value. This resale value varies between products but is directly correlated to the demand that product has.
With tech growing due to our continual need for it in our daily lives, demand is constantly rising while the pandemic’s production infrastructure falls short, creating triple the initial MSRP for resale.
Honors Biology teacher Craig Parker contributes his perspective to this issue. “As a buyer partakes in a financial transaction, they are accepting the cost set by the seller. Whether this seems fair to other buyers is irrelevant since they aren’t partaking in this exchange,” he said.
Whether scalping is a just reaction of our capitalistic market or not, the effect on education is prevalent.
Students, especially those pursuing careers in STEM, are losing both resources and opportunities in computer-requiring classes. With the recent growth of online learning, the need for even cheaper laptops to join these classes aren’t being met.
Parker believes the way to stopping this inflation bubble is to trust in capitalism. “Our market is designed to handle these bubbles. Scalping adds necessary money to the market to stabilize it. Those who abstain from buying at resale prices reduce demand and drop the MSRP anyway. Both scenarios benefit the long-term market,” he said.