 LegoPower77AbecedarianPremium
join:2002-08-03
Midlothian, VA | reply to broadbander
Re: Will the data show regulation the way to go? When I say free market, I don't mean a perfectly competitive one. Degrees of market concentration are unimportant, in some cases a highly-competitive market works best and in others, they don't. The processor market is super-concentrated, but it's damn cut throat, too.
A company that makes monopoly rent can and does offer a benefit because they have the resources for research and development. Standard Oil in 1870 sold refined oil at $26.4/bbl and had 4% market share. By 1911, they had brought the price down to $4.7/bbl and had 69% market share. Same scenario for Alcoa, in 1887 a pound of aluminum sold for $5-8, by 1941 it was down to 15¢/lb.
This is why the Hayek quote, "Enthusiasm for perfect competition in theory and the support of monopoly in practice are indeed surprisingly often found to live together."
said by broadbander:Utilities are very odd and particular markets though, not exactly prithee to typical market rules. Fair enough. That Regulatory Reform article in my other post shows the "rightist" side of the public utilities conundrum.
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"It is a melancholy reflection that liberty should be equally exposed to danger whether the government have too much or too little power."—James Madison
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