Economics: What a monopoly isn't.

[DBTrek]

There's a misconception that monopolies are businesses that have captured 100% of the customer base. This isn't true. Think about the first general store to crop up in Texas. Were they a monopoly? If "owning" all the customers makes a business a monopoly, then every new type of business that crops up is a monopoly by default.

No, a monopoly exists when a business is protected from facing competition. The first general store in Texas isn't a monopoly because they had no power to prevent the second general store, or third, from setting up in Texas.

Now . . . what entity can prevent new businesses from arising to challenge established ones?
The government.

That's it. The government is the only entity that can put up anti-competitive barriers to ensure no new challengers enter a particular market space. So the takeaway is this - if a monopoly exists, then odds are the government is responsible for allowing or facilitating its existence. Thus, turning to the government to craft anti-monopoly legislation is like turning to the Luciano/Genovese family to create anti-organized crime legislation.
Be wary!

[Fife]

For all the silliness that you members have tolerated in the last few days, DB just gave you more economic truth in one post than you got or would have gotten in all of your formal education. Ask him what book he's reading.

[K@th]

Great post that should be the boilerplate answer for any "but but net neutrality" question.






I sure hope Smitty approves of this topic.

[Martin Hash]

You should do a podcast. You'd have more followers than me just from people in this thread.

[DBTrek]

For all the silliness that you members have tolerated in the last few days, DB just gave you more economic truth in one post than you got or would have gotten in all of your formal education. Ask him what book he's reading.

I figure I’ll share the knowledge, since MH likes to talk a lot of policy without addressing the economic details. So ... I’ll just lay out the economic truths as I know them, and that way folks will Know where I’m coming from when I disagree with his points.

Plus, folks may learn something, and that’s cool too.

[Martin Hash]

What forum R U talking about? Nobody here disagrees with you but me.

[K@th]

What forum R U talking about? Nobody here disagrees with you but me.

A true martian, through and through.

[DBTrek]

What forum R U talking about? Nobody here disagrees with you but me.

That’s not true. StA agrees with you and disagrees with me. He likes UBI and despises “Mammon”. GCF agrees with you often, as well.

... all which makes me even more confident that I’m on the right track.


Hold up though, I’ll do one on how we can *know* that there is no gender pay disparity and that will alienate half this crowd.

[SuburbanFarmer]

I don't think you could argue that 'only government creates artificial barriers to entry'.

Wal-mart and Amazon regularly sell at a loss, buy up retail space, write ridiculous supplier contracts, and all sorts of other dirty tactics, to prevent competition.

Otherwise, I agree with your post.

[GloryofGreece]

No government intervention, no monopolies? Is that it?