In both cases, one sells for what the market can bear. The primarily difference is in who's setting the price, and seeing if the market will pay for it.
- Pinball, NIB: Sellers set a price; hope the inventory moves. Pricing too low is a wasted opportunity. Pricing too high translates to lots of inventory on hand; and/or the sunk R&D costs being written off.
- Pinball, Auctions: Buyers set the price. Shill buyers raise the price to see what the buyer will do. This is a game of poker (or perhaps chicken) as the shill pricing things too high turns this into an *effective* no-sale, and sits on the inventory until the next auction (or finds another avenue to sell the machine).
- Online advertising: The buyers set the price. The buyer with the deepest pockets and the most willpower to claim the spot, in particular, sets the price. The moment that buyer goes soft, the #2 buyer steps up.
All of these cases: Nobody pays more than they are willing. The moment the price is higher than one is willing to pay, one walks. None of us give a rats ass about what it cost to produce (the games, or the adwords opportunity) - we care about what we get out of the deal, and what it will cost us. Nothing else.
So, really, I see frolic and dhalem being both quite right.
