3 ms·

> And where does this money go? What does it end up doing? Some of it goes to providing jobs to those same middle class people.

bigdubs 8y ago
The share of incomes from private businesses (especially luxury businesses) isn't flat and benefits mostly the executives and directors and shareholders.
- wbracken 8y ago
  How can you say that? Luxottica employs 85,000 people. Do those people obtain no benefit from employment?
  - cazum 8y ago
    What? Nobody is claiming that they don't. What is being claimed is that the majority of those employees are not seeing an increased benefit (wages) proportional to the increased profits of the company they work for, whereas shareholders and executives do.
    - wbracken 8y ago
      https://www.businessinsider.com/esop-essilor-employee-shareholders-2018-11 https://www.businessinsider.com/esop-essilor-employee-shareh...
  - Someone1234 8y ago
    If there was healthy competition that same number of jobs may be split over multiple companies, but it would still have to exist since the market for the product itself wouldn't change. That isn't an argument for not breaking up a monopoly. Only an argument that the market may be big enough to support actual competition.
    - volkl48 8y ago
      Look at the beer market. Total beer volume sold is falling. Employment in breweries has doubled since 2010. Why? Because the market is fragmenting to smaller operations who employ more people per unit of beer produced. You can argue that from both sides, that it's less efficient vs generates more jobs, of course.
  - toss1 8y ago
    Obviously they obtain benefit form employment. If it were multiple competing companies, the same output would probably require MORE employees. One of the ways it is so profitable is to implement economies of scale not possible in a less monolithic industry. You are failing to see that extractive business models such as monopolies do not add value, they extract value and concentrate it in the hands of the execs/owners. This removes capital from the socio-economic system/society and reduces the capabilities of the whole system to grow (the occasional purchase of a yacht does not rebalance things).
Someone1234 8y ago
Considering their profits, I don't believe that is where it is going: http://www.luxottica.com/en/record-2017-net-profits-and-free-cash-flow-over-one-billion-euro http://www.luxottica.com/en/record-2017-net-profits-and-free... Using a monopolistic position to overcharge doesn't generate more jobs, just profits.
- vibrio 8y ago
  Are 10-15% margins crazy large in this or comparable sectors? I'm genuinely asking as I'm to busy/lazy to look it.
  - wbracken 8y ago
    Of course not.
    - vibrio 8y ago
      According to my basic understanding of basic economics (FWIW), doesn't this put a hole in the monopoly hypothesis here? [I'm not even close to being an economist, but I've taken a basic class or two.] I looked at their 2017 financials, and they have revenue/ expenses broken out for many many brands and regions. There are huge variations in margins due to what it seems like to be growth expenses. Some of what i'd think to be more mature lines at first glance to have crazy good margins.
- deleted 8y ago
  [deleted]
cazum 8y ago
There are plenty of examples where rising profits in an industry have led to workforce downsizing, not job creation. Is there any data to show that these excessive eyewear profits are being used to create new jobs?
noonespecial 8y ago
I think what it probably looks like from a mile high is that we all have a little less eyewear than we could so that a lucky few can have a lot more of everything than they probably should. We perceive this to be unfair and wonder if we should risk reorganizing society a bit to remedy this.
munk-a 8y ago
You should familiarize yourself with the broken window fallacy[1], it fits this scenario pretty precisely and... well, it's a fallacy. [1] https://en.wikipedia.org/wiki/Parable_of_the_broken_window https://en.wikipedia.org/wiki/Parable_of_the_broken_window

bigdubs 8y ago

The share of incomes from private businesses (especially luxury businesses) isn't flat and benefits mostly the executives and directors and shareholders.

wbracken 8y ago
How can you say that? Luxottica employs 85,000 people. Do those people obtain no benefit from employment?
- cazum 8y ago
  What? Nobody is claiming that they don't. What is being claimed is that the majority of those employees are not seeing an increased benefit (wages) proportional to the increased profits of the company they work for, whereas shareholders and executives do.
  - wbracken 8y ago
    https://www.businessinsider.com/esop-essilor-employee-shareholders-2018-11 https://www.businessinsider.com/esop-essilor-employee-shareh...
- Someone1234 8y ago
  If there was healthy competition that same number of jobs may be split over multiple companies, but it would still have to exist since the market for the product itself wouldn't change. That isn't an argument for not breaking up a monopoly. Only an argument that the market may be big enough to support actual competition.
  - volkl48 8y ago
    Look at the beer market. Total beer volume sold is falling. Employment in breweries has doubled since 2010. Why? Because the market is fragmenting to smaller operations who employ more people per unit of beer produced. You can argue that from both sides, that it's less efficient vs generates more jobs, of course.
- toss1 8y ago
  Obviously they obtain benefit form employment. If it were multiple competing companies, the same output would probably require MORE employees. One of the ways it is so profitable is to implement economies of scale not possible in a less monolithic industry. You are failing to see that extractive business models such as monopolies do not add value, they extract value and concentrate it in the hands of the execs/owners. This removes capital from the socio-economic system/society and reduces the capabilities of the whole system to grow (the occasional purchase of a yacht does not rebalance things).

Someone1234 8y ago

Considering their profits, I don't believe that is where it is going: http://www.luxottica.com/en/record-2017-net-profits-and-free-cash-flow-over-one-billion-euro http://www.luxottica.com/en/record-2017-net-profits-and-free... Using a monopolistic position to overcharge doesn't generate more jobs, just profits.

vibrio 8y ago
Are 10-15% margins crazy large in this or comparable sectors? I'm genuinely asking as I'm to busy/lazy to look it.
- wbracken 8y ago
  Of course not.
  - vibrio 8y ago
    According to my basic understanding of basic economics (FWIW), doesn't this put a hole in the monopoly hypothesis here? [I'm not even close to being an economist, but I've taken a basic class or two.] I looked at their 2017 financials, and they have revenue/ expenses broken out for many many brands and regions. There are huge variations in margins due to what it seems like to be growth expenses. Some of what i'd think to be more mature lines at first glance to have crazy good margins.
deleted 8y ago
[deleted]

cazum 8y ago

There are plenty of examples where rising profits in an industry have led to workforce downsizing, not job creation. Is there any data to show that these excessive eyewear profits are being used to create new jobs?

noonespecial 8y ago

I think what it probably looks like from a mile high is that we all have a little less eyewear than we could so that a lucky few can have a lot more of everything than they probably should. We perceive this to be unfair and wonder if we should risk reorganizing society a bit to remedy this.

munk-a 8y ago

You should familiarize yourself with the broken window fallacy[1], it fits this scenario pretty precisely and... well, it's a fallacy. [1] https://en.wikipedia.org/wiki/Parable_of_the_broken_window https://en.wikipedia.org/wiki/Parable_of_the_broken_window