Do Dealers Or Catalogue Publishers Decide How Much You Pay?

I've always felt that the worst thing that can happen to any collectable is creation of a price guide for it.

Clewless Gnubeesâ„¢ invariably skip the first 50 pages explaining what the prices represent and look up the highest price on anything resembling what they have.

In one case (I forget the details) two guys were mistakenly bidding on the same coin, and the price went into the price guide. Dealers repriced their coins to this error price, and for years, everyone had quantities of this overpriced coin for sale.

Then there are monthly guides, almost requiring higher prices each issue to justify buying each one.

Just remember to pronounce it correctly. It's a price guide, not a Price God.

It's a feedback thing.

Actually, we the collectors determine the price that coins actually sell for. If a rogue dealer list a coin at $200 while everyone else is selling them for $100, it'll sit on the dealer's display case until doomsday; if nobody except the occasional crazy eBayer or uninformed newbie is paying $200, it can't really be said to be "worth" $200 at that point.

If, however, several big-name dealers think they can get more for those coins and jack up the price of the coin to $200, and they actually sell at that price, a diligent cataloguer is sure to notice this and respond with higher prices accordingly. Alternatively, a "lazy" cataloguer might simply bump all their prices up by some arbitrary figure.

It's been my experience that most dealers don't bother re-valuing their old stock of coins every time a new catalogue comes out. They worked out the profit margin a coin needed when they first offered it for sale, and it stays at that price until either it sells or the ticket fades into illegibility, at which time a new ticket with as new price is written up. The only exception is for near-bullion-value coins when the bullion price is going up. You can be sure all the dealers will ride that wave all the way up the beach.

But I would agree with the second half of your surmise: once the catalogue says it's worth $200, the dealer will probably find a lot more "by-the-book" customers actually willing to pay that price.

quote from Sap: "a diligent cataloguer"
- and who might that be ?
Maccas is a joke, and Renniks is only slightly better.
The best that can be said for them is that they give an indication of relativities.
I accept that ebay is not the forum-of-choice for high-end coins, but for the majority of the market, it is very informative.
Another factor is that ebay is a world-wide market, so it is much easier to find a specific item among hundreds of ebay vendors, compared to visiting, 'phoning, or even e-mailing a few dozen dealers.
I acknowledge that ebay has its flaws, but it is difficult to imagine how the catalogue-makers collect their data.

The worst part is when a collector makes a buying decision solely on the catalogue. If you think about it: They'll always be at a disadvantage:
Eg: If the catalogue overvalues a coin, the collector will overpay.
If the catalogue undervalues a coin, the collector won't own that coin.

The guides are a joke. The prices quoted (Maccas, Renniks) are generally too high but for foreign guides (Krause etc) the prices are generally too low and not updated (I collect Egyptian coins besides Australian and they haven't updated the figures since the 1990s so higher grade coins are listed at bullion value).
Only good thing (for me as a buyer) is that the catalogues don't list varieties separably so sometimes uninformed dealers will sell coins such as the 1920 dot over top or 1927 Indian at/below the book price for common 1920 or 1927 coins.
As far as the catalogues being "useful" for finding out mintage figures I find (at least for Geo v bronze) that the cataloguers are using the same erroneous numbers that their predecessors used back in the 1960s (that repeats and reinforces the mistakes so many collectors end up quoting those figures as if they were the Gospel Truth).

I understand the prices and consumer details at the front of the book and I'm not saying they are actually that bad. I agree that the guides are useful in working out roughly how much a dealer will sell their coins for.

What I am pointing out is I think it is because the dealers blindly follow what the catalogue publishes. The dealers look at the catalogue value to determine how much they will sell it at. If for no good reason a catalogue suddenly started listing coins $100 extra next year I bet the dealers would increase their prices by this much just because the catalogues did, not because they have actually seen an increase in the coins popularity.

I guess its a case of "the chicken or the egg".

Personally I have seen a lot of price variation amongst dealers which would suggest that they don't just slavishly follow the catalogues. Bricks and mortar retail dealers tend to be higher, internet dealers tend to be lower. For example, Ye Olde Coin will often sell things at half the catalogued price. On the other hand Carolyn Coins sell things for way over the catalogued price.