Is haggling bad for third-world merchants?

Will Wilkinson seems to think so. In a recent post over at his blog, Will explains that on his recent trip to Turkey, he was looking to buy some souvenirs, but knew he was at a disadvantage in bargaining with local merchants. Not only that, but Will– like many people I know– says that he’s no good at haggling and he hates having to do it. Writes Will:

“[P]robably hundreds of my dollars stayed in my pocket because I didn’t have good information about the quality of products and I knew the retailer is better at bargaining… than I am.” Although haggling does allow merchants to come out ahead in lots of transactions, Will says, “[A]dd up millions of instances of ‘I know you’re going to screw me,’ and I suspect that the average retailer is doing worse rather than better under the haggling system.”

Although I don’t share Will’s distaste for haggling– I find it an entertaining, sometimes even fun experience– fixed prices might provide tourists with a bit more assurance that they’re not getting completely screwed by local merchants. If everyone’s paying the same price, the thinking goes, certainly it must reflect reality at least in some sense. What do you think? Would merchants, particularly those in poor countries, benefit from eliminating the pre-purchase haggling ritual?

Back in March, Gadling talked travel with Will Wilkinson here.