Why is it that in economics, when demand is greater than supply, prices “automatically” go up? Isn’t it sellers that decide to raise prices because buyers are willing to pay more? Couldn’t sellers choose to not raise prices?
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1. Why would you sell for less than people are willing to pay. If your boss offers you a 10$ an hour raise because people in your job are in high demand, are you going to say *’nah I won’t take it I choose not to raise the price*’?
2. Even if you don’t take the raise, if there is no one that has your skills it wont solve the issue of the demand for people with your skills. The only way demand will go down is if the cost for hiring someone with your skills goes up so high people no longer want it.
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