4 ms·

First, losing money to edge out competition is not illegal. Loss-leaders are a normal business practice. Second, none of your three points refute the Chamberla

First, losing money to edge out competition is not illegal. Loss-leaders are a normal business practice. Second, none of your three points refute the Chamberlain argument. 1. There were limited alternatives to Wilt. When Wilt was named MVP in 1959, there were 8 NBA teams. 2. Technically, there were 39 other players in the starting lineups of NBA teams that year. 3. Among those starters was Bill Russell, whose Boston Celtics won their second straight NBA championship that year. The NBA has controlled membership very tightly in all the years since. It has been granted exceptions from laws prohibiting anti-competitive behavior. And yet, Wilt is still featured in this classic thought experiment to illustrate fair distribution of wealth.

metaphorm 10y ago
why are you talking about the basketball example? post you responded to was talking about consumer choice in sectors that suffer from monopolies or oligopolies such as internet (or mobile data) service provider.
milesrout 10y ago
> First, losing money to edge out competition is not illegal. Loss-leaders are a normal business practice. Well for a start, loss leading and intentionally lowering prices unsustainably to cut out competitors are different things. Loss leaders don't exist to be anti-competitive, they exist to attract people to your shop so they will buy the other things you have, which is how you make profit. Selling some things below cost in order to sell other things to make a profit is fine. Selling some things below cost in order to not make a profit, living off of venture capital while your competitors go out of business? Completely different story. And, quite frankly, 'normal business practice' means fuck all. Lots of things are normal, illegal and unethical. >Second, none of your three points refute the Chamberlain argument. No, the argument resting on a false dichotomy refutes itself. >And yet, Wilt is still featured in this classic thought experiment to illustrate fair distribution of wealth. I have no fucking idea what NBA is.
- fdupoo 10y ago
  I was going to chime in, but you nailed it here. Absorbing losses until your competition goes out of business is called price gouging. It's considered unethical and in many current cases is actively punished worldwide. Advantageous access to funding is usually (but not always) the enabler. In the early 20th century US Industry invaded Brazil with much lower interest rates and absolutely decimated Brazil's budding manufacturing sector, to which it has never recovered. Then there's Wal-mart in the US -- Amazon's strategy is not unlike Wal-mart's was (ream the competition in a price war with lower prices and ginormous investments in logistics technology, which bring competitive cost-savings). It's impossible to beat that triad (low prices, being flush with outside capital, huge investments in cost-savings). Other businesses without all that money can't keep prices low and invest heavily at the same time. Another advantage:You hardly need to advertise. You make a name for yourself with the good deals you give everyone. I don't think it's fair. I don't shop at a wal-mart, I don't use amazon, and I don't use uber(never have). That's about the only solution I can see: don't patronize scumbags. Maybe one day the banking system will be less democratic. For now, the bankers pick favorites and those favorites become ever more favorable, because the goal of these schmucks is the centralization of wealth-- so why not get to centralizing it?
  - fdupoo 10y ago
    ERRATA: *maybe the banking systems will be MORE democratic
  - dragonwriter 10y ago
    > Absorbing losses until your competition goes out of business is called price gouging. No, it's called dumping. Price gouging is a different unethical pricing maneuver. https://en.m.wikipedia.org/wiki/Dumping_(pricing_policy) https://en.m.wikipedia.org/wiki/Dumping_(pricing_policy) https://en.m.wikipedia.org/wiki/Price_gouging https://en.m.wikipedia.org/wiki/Price_gouging

metaphorm 10y ago

why are you talking about the basketball example? post you responded to was talking about consumer choice in sectors that suffer from monopolies or oligopolies such as internet (or mobile data) service provider.

milesrout 10y ago

> First, losing money to edge out competition is not illegal. Loss-leaders are a normal business practice. Well for a start, loss leading and intentionally lowering prices unsustainably to cut out competitors are different things. Loss leaders don't exist to be anti-competitive, they exist to attract people to your shop so they will buy the other things you have, which is how you make profit. Selling some things below cost in order to sell other things to make a profit is fine. Selling some things below cost in order to not make a profit, living off of venture capital while your competitors go out of business? Completely different story. And, quite frankly, 'normal business practice' means fuck all. Lots of things are normal, illegal and unethical. >Second, none of your three points refute the Chamberlain argument. No, the argument resting on a false dichotomy refutes itself. >And yet, Wilt is still featured in this classic thought experiment to illustrate fair distribution of wealth. I have no fucking idea what NBA is.

fdupoo 10y ago
I was going to chime in, but you nailed it here. Absorbing losses until your competition goes out of business is called price gouging. It's considered unethical and in many current cases is actively punished worldwide. Advantageous access to funding is usually (but not always) the enabler. In the early 20th century US Industry invaded Brazil with much lower interest rates and absolutely decimated Brazil's budding manufacturing sector, to which it has never recovered. Then there's Wal-mart in the US -- Amazon's strategy is not unlike Wal-mart's was (ream the competition in a price war with lower prices and ginormous investments in logistics technology, which bring competitive cost-savings). It's impossible to beat that triad (low prices, being flush with outside capital, huge investments in cost-savings). Other businesses without all that money can't keep prices low and invest heavily at the same time. Another advantage:You hardly need to advertise. You make a name for yourself with the good deals you give everyone. I don't think it's fair. I don't shop at a wal-mart, I don't use amazon, and I don't use uber(never have). That's about the only solution I can see: don't patronize scumbags. Maybe one day the banking system will be less democratic. For now, the bankers pick favorites and those favorites become ever more favorable, because the goal of these schmucks is the centralization of wealth-- so why not get to centralizing it?
- fdupoo 10y ago
  ERRATA: *maybe the banking systems will be MORE democratic
- dragonwriter 10y ago
  > Absorbing losses until your competition goes out of business is called price gouging. No, it's called dumping. Price gouging is a different unethical pricing maneuver. https://en.m.wikipedia.org/wiki/Dumping_(pricing_policy) https://en.m.wikipedia.org/wiki/Dumping_(pricing_policy) https://en.m.wikipedia.org/wiki/Price_gouging https://en.m.wikipedia.org/wiki/Price_gouging