Re:Truckers Working Alongside Coders Trying to Make Driverle...
by vkou on Friday June 23, 2017 @01:07PM
(#14620762)
Amdahl's law. Shipping is only useful when you have goods to ship. Unless you're selling bricks, shipping is a small portion of the price of most products. Reducing the cost of shipping, which is already a small portion of the price of the product will not result in price elasticity of greater then 1.
Lots of products have price elasticity of greater than 1.
Shipping seems like a very elastic industry. If anything, demand would increase by more than 1% for every 1% decrease in cost.
This is because shipping costs if shipping costs are low enough, then you can build something for cheap somewhere else and then ship stuff across the country to high cost of living locations.
YOU wouldn't ship stuff more, but industry would.
IE imagine if something costs 1/3 if it is made in China.
If shipping costs are more then you save, then nobody would ship it. But if shipping costs go down, now you can easy get those cost benefits of across world or across country manufacturing.