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/sci/ - Science & Math

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3361789 No.3361789 [Reply] [Original]

Markets cannot be competitive, efficient, or fair, except under terms of relative equality. So why do capitalist economies permit accumulation of market shares in the hands of monopolies and oligopolies?

By instituting laissez-faire, you let powerful corporations run rampant, driving up costs to entry and driving competition down.

For the most part, the free and fair markets of the world destroyed themselves long ago.

>> No.3361812

Free and fair markets never existed. The capitalist economy is just as planned as the other except for the fact that the common man does not know of this.
/thread
And this reminds me what happened of our resident/sci/economist?
These threads would attract a lot of his attention.

>> No.3361827

>So why do capitalist economies permit accumulation of market shares in the hands of monopolies and oligopolies?
Short-sighted greed.

The global optimum has a fairly equitable wealth distribution. Dirt farmers contribute nothing to the economy, and the marginal utility of money is nonlinear.

But capitalism with limited regulation beats everything else we've tried.

>> No.3361834

>>3361812
> The capitalist economy is just as planned as the other except for the fact that the common man does not know of this.
Yeah, no. There's nothing like Stalin's 5-year-plans or Mao's Great Leap Forward, spearheaded by one or a few very powerful but incompetent people. Capitalism is more distributed than that, even with the formation of large corporations.

>> No.3361851

>>3361834

Marxist-leninism is basically monopoly capitalism controlled by a political party who also owns the state.

The similarities are there.

>> No.3361862

You do realize that many of today's great corporations can maintain their position because they get special treatment from governments?

Also, there is nothing inheritly wrong with a monopoly in a free market. It just means that that company can deliver the best product. When it no longer can, they will lose their monopoly. It's often this important mechanism that is disabled when governments get involved with the economy.

>> No.3361865

>>3361851
Perhaps, but calling it capitalism when there is no competition, anywhere, is a little strange.

Also private property and free trade. Nah, fuckit, I don't buy what you said. Only the black market in the USSR had capitalism. There is no capitalism without property and the right to exchange it.

>> No.3361870

>>3361862
>It just means that that company can deliver the best product. When it no longer can, they will lose their monopoly.

I think you fail to understand the implications of a monopoly. Your statements suggest you believe there are still competitors who will gain market share when the monopoly becomes abusive and inefficient. But that means it was never a monopoly.

>> No.3361875

>>3361870
However, I fully agree that government-granted monopolies are one of the worst kinds, UNLESS the formation of such a monopoly is inevitable (natural monopoly).

Private monopolies suck ASS.

>> No.3361923

>>3361870
Well, in order for a corporation to maintain a monopoly that completely inhibits efforts of competitors they'd need the right to use violence that the state owns.

>> No.3361938

>>3361875
When is the forming of such a monopoly natural?

>> No.3361935

>>3361923
There are economic modes of violence. The counter is usually in the form of antitrust laws.

>> No.3361953

>>3361938
http://en.wikipedia.org/wiki/Natural_monopoly

Anything that makes the presence of competition impossible, infeasible, or incredibly inefficient. This includes
1) Resources that cannot be shared (a specific piece of land)
2) Infrastructure that is very expensive to build and easy to maintain
and other stuff, I'm sure.

Example include power, water, and sewage infrastructure. Can you imagine entirely parallel sewer systems? Three power lines going to your house? Two entirely separate water mains?

Neither can competitors. Once the first one is in place, he can naturally prevent the others from entering because of the very high up-front costs of entering the market, and the extreme inefficiency produced by so doing. The guy who already has the infrastructure can easily keep out competition.

>> No.3361956
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3361956

>mfw economics threads are more interesting than 90% of physics threads on /sci/

>> No.3361969

>So why do capitalist economies permit accumulation of market shares in the hands of monopolies and oligopolies?


I don't think they do. There's all sorts of regulations to prevent that

>> No.3361970

>>3361953
(cont)
One solution, if you don't like public ownership (government control), is having multiple companies compete for control of the infrastructure, or forcing sharing where feasible (like with communications). BTW, we really should force line-sharing. The american duopoly is becoming a joke compared to municipal or shared communications in other nations.

>> No.3361973

>>3361969
>There's all sorts of regulations to prevent that
Than it's my observation that they could be working better. But it's not as bad as the days of Ma Bell yet - though we're heading there.

>> No.3361975

the economy is like an eco system, it only requires a very small manipulation of it, a regulation or the introduction of a new species, to fuck shit up real bad.

>> No.3361984

>>3361973
>But it's not as bad as the days of Ma Bell yet

The fact that that company was divided suggests you're wrong.

>> No.3361987

>>3361984
>The fact that that company was divided suggests you're wrong.
The liquid-metal Terminator has not fully re-formed yet. That's all I'm saying.

>> No.3362001

>>3361987
Indeed, extreme caution is required.