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Interesting. With enough optimisation of the mechanisms of modern capitalism we arrive at a state where a single amorphous entity owns the economy so there are
by praptak 11y ago
Interesting. With enough optimisation of the mechanisms of modern capitalism we arrive at a state where a single amorphous entity owns the economy so there are no incentives created by competition.
- uptown 11y agoYou could say the same for politics.
- danharaj 11y agoThat is true if you limit yourself to preserving some political structure. It is not true if you consider revolutions and radical changes to be politically legitimate. There is no ideology or system you can encode in prescriptive rules that endures forever. Capitalism(s) has had a long run, but so did feudalism(s). I pluralize because those systems have changed. What happened to feudalism in the end was that its fundamental tenets were overthrown. What remained could not be called feudalism. It remains to be seen if and how that occurs with capitalism. What can be discarded to make the incumbent institutions endure? How long will that last?
- praptak 11y agoI don't think any political entity owns the economy. Quite the opposite - campaign funding is how the economy controls politics.
- nickff 11y agoI have only seen recent studies finding that campaign spending has little impact on electoral outcomes; if you have evidence that elections can be bought, please provide it, so that I may be enlightened.[1] [1] http://pricetheory.uchicago.edu/levitt/Papers/LevittUsingRepeatChallengers1994.pdf http://pricetheory.uchicago.edu/levitt/Papers/LevittUsingRep...
- praptak 11y ago"I have only seen recent studies finding that campaign spending has little impact on electoral outcomes;" It's a 1994 article and the research didn't stop in 1994. There are quite a few after-1994 articles supporting either view. "if you have evidence that elections can be bought" Influenced. Here's an example one from 2004: http://karlan.yale.edu/fieldexperiments/papers/00246.pdf http://karlan.yale.edu/fieldexperiments/papers/00246.pdf TLDR: authors designed and performed some actual experiments whose outcomes support the thesis that campaign spending works - better for a challenger than for an incumbent.
- TeMPOraL 11y agoIsn't the whole capitalism based on promising people monopoly but not letting them actually get it? I.e. no profit-seeking entrepreneur in their right mind would act to create competition for themselves. Competition means waste of time and resources, so there's no surprise every player tries to figure a way how to reduce it, aiming for bigger and bigger pieces of the whole pie in the process. The state you described seems like a part of the natural evolution of market incentives.
- pcmaffey 11y agoExcept markets are not a zero-sum game. The best capitalists make the pie bigger by creating new value.
- s73v3r 11y agoThat's not always possible.
- theseatoms 11y agoNo, not always possible, but it is very much so the rule, rather than the exception. The many wonders of the modern world are, by and large, the result of capitalist forces.
- praptak 11y ago"But not letting them actually get it." Article thesis is that funds go around that limit. Not even on purpose, just by their definition. No single company has monopoly but index funds collectively own all of them.
- stdbrouw 11y agoThe article also explains that this is only true when a few large players control the market. E.g. an index that includes all of the major pharmaceutical companies. Indexes generally don't invest in startups taking on the incumbents, so there's an opportunity there as long as competition is realistic / the existing players are not too entrenched.
- Brushfire 11y agoThe beauty of modern capitalism is that it is more about incentives, not performance. Incentives drive swings between consolidation and fragmentation, because individuals believe they can profit from being different from the status quo.
- dade_ 11y agoI don't see any risk of this scenario. I invest heavily in index funds. Generally my focus is on which countries / regions I believe will outperform others. It has provided strong returns without active trading.
- xux 11y agoI think you've just described Berkshire Hathway