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by numbsafari 1064 days ago
Why should the sellers be shortchanged?
2 comments

If the increase in value of the sellers' land is wholly due to Disney's development of its land nearby, the sellers would simply be benefiting from a positive externality created by Disney. Thus it would be Disney being shortchanged if it was unable to capture the value of that externality.

From an efficiency standpoint it is also preferable for the developer to capture the value, as naturally that increases incentives for development.

Is it okay for the buyer to lie, but not okay for the seller to ask for the truth and adjust their price accordingly? This 'anything goes' market ideology is the same framework that leads us to deceptive subscription systems, anti patterns etc. Deceiving people to make a buck is shitty behavior.
I’m pretty shocked by the whole “profiting from a deceptive transaction is ok if the counterparty believes you” attitude here. I guess I expected more out of HN. I feel like I’d have to keep my hand on my wallet and my eyes over my shoulder if I ever visited any of these guys’ businesses.
HN has for a long time (longer than I've been here) had a strong libertarian streak, and like all libertarians they always seem to believe they're the ones who would come out on top in anarchy despite all historical evidence to the contrary.
From an efficiency standpoint it is preferable for a Land Value Tax to incentivize selling to whoever will put the property to best use.
> If the increase in value of the sellers' land is wholly due to Disney's development of its land nearby, the sellers would simply be benefiting from a positive externality created by Disney

Isn't that true of any price increase due to increased demand? It seems like you're saying a seller shouldn't be allowed to raise their prices as demand increases, because they'd simply be benefiting from a positive externality created by the buyer.

Nobody was short changed. The fair price is what a buyer and seller agreed to unless someone provided false information.

The word "no" is a complete answer to a request for more information.

That’s true only if both parties have perfect information, which is of course why Disney went to great lengths to prevent that.

There would be no such thing as fraud if “accepted transaction == definitionally fair.”

Perfect information has nothing to do with fair

There's a difference between false information and no information.

False information like

Q: Who is buying this land?

A: XYZ Shell Corp (no connection to who is actually effectively buying and coming into control of this land)?

Obviously your argument will be "it's not false that XYZ Shell Corp is buying it," and sure, but it's obviously misleading in a way that affects the transaction, as it is specifically designed to do.

I don't even think it's misleading. You don't know what XYZ show Corp does or will do with the land. It's a mystery not a deception.

On the other hand, if the buyer is called XYZ Fun Center and tells you that they're going to put in a nonprofit for Orphans, that would be deception.

It all comes back to the idea that saying I won't tell you what I'm going to do with the purchase is not a lie. It's perfectly honest

I'd say the primary concern is not with the purchasing party exercising their right not to disclose their intent post-sale. It's that they're intentionally masking their identity to prevent unwelcome influence on the transaction (i.e. If you know I'm rich, you're going to jack up the price.)

I think the argument is really over whether parties on either side are entitled to privacy/anonymity. The answer seems to be 'yes' in the form of typically legal shell corps, anonymous LLCs, and the like.

It's not about fairness, it's about letting markets work properly, reaching a market-clearing price that maximizes total welfare.
It has everything to do with price, however — and, therefore, "fair price".
Define fair price?

Fair prices when a buyer and seller agreed to as long as no one's lying. The fair price has nothing to do with how much money the buyer or seller make more lose.

When I read your comment above, I wondered if you'd gotten here by defining "fair" circularly.

And... yep.