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Why are most industries dominated by a few? It's not because they pay the lowest. It's because consumers chose to support those few businesses.
by bsbechtel 11y ago
Why are most industries dominated by a few? It's not because they pay the lowest. It's because consumers chose to support those few businesses.
- tma-1 11y agoNope, they're dominated by a few because when a specific company becomes successful enough it can buy out the rest of the players.
- Tideflat 11y agoThis only works when there are economies of scale. If there are significant dis-economies of scale smaller firms can out-compete the large firms. The large firm can't just buy up all the small firms either because new firms are started all the time, and if every person who starts a small firm is rewarded with a buyout, the industry will attract more and more new firms until the large firm can no longer afford to buy out new firms. --------------- Examples of industries that not dominated by three or four large companies: mining, farming, house cleaning, and being a land lord.
- tma-1 11y agoIt happens when large firms have a lot of extra liquidity and cheap debt. Look at FB and Google.