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> If a company like amazon generates very little corporate profit, is that unproductive growth? Of course not. There would be more employees, more taxes paid,
by grecy 7y ago
> If a company like amazon generates very little corporate profit, is that unproductive growth?
Of course not. There would be more employees, more taxes paid, more buildings being built, more assets, etc. thus more money going into the economy.
I've always dreamed that companies should run with zero profit (like the outdoor store co-ops like REI or MEC in Canada). They could price their products so they don't make any "extra" money each year after all expenses and salaries, etc.
I think we'd live in a better world if a company like Apple didn't exist to make ever increasing profits, but existed just to create the products they create.
- kingludite 7y agoThe postal service kinda works like that. It can make some profit in some countries but not much. In the US Amazon accounts for 40% of the parcels. Putting things into boxes and shooting some web is impressive but getting the boxes from A to B also takes some doing.
- H8crilA 7y agoThis is what the government is. It's a large non-profit, in fact the largest player in the economy, that's always zipped to produce no profits. There isn't even any structure to distribute the profits (there are no "shares" of the government or anything of this sort). The whole point of profits and investing is to hook up the "skin in the game" of investors to viability of project. That's the definition of capitalism.
- grecy 7y ago> That's the definition of capitalism It's interesting though that there are certainly extremely successful companies like MEC in Canada and REI in the US who don't follow this model. Their customers are extremely happy. Their staff get paid. The y create excellent value for customers. BUT they don't make a profit. Nobody can get rich from owning a slice of it. Why couldn't more companies be like that?
- TeMPOraL 7y ago> They could price their products so they don't make any "extra" money each year Isn't that precisely what you get from competitive pressure in a free market? Things end up priced barely above production costs. > I think we'd live in a better world if a company like Apple didn't exist to make ever increasing profits, but existed just to create the products they create. That would be a nicer world to live, true. Unfortunately, we've created a system in which the primary reason for a company to exist is to make profits - and then we pit companies against each other to minimize profits made. The end result is a lot of creativity unleashed in the process of innovating, cheating and defrauding your way into not being a commodity.
- grecy 7y ago> 't that precisely what you get from competitive pressure in a free market? Things end up priced barely above production costs. Evidently no. Companies are making hundreds of millions in profit every ear, they're paying their CEOs tens of millions as a "bonus". They're they're making a lot, LOT more than just "barely above production costs"
- krapp 7y agoWe don't actually have a free market, though. Free markets don't exist in the real world, only the "perfectly spherical cow in a frictionless vacuum" world of economic models.
- TeMPOraL 7y agoThere is no competitive pressure within a company. CEO pay is usually an insignificant fraction of a company's revenue; there's enough inefficiencies both within the system and within the market to allow this to exist, even if the actual product of a company is a commodity. The other part of my comment also mentioned that companies do everything they can to avoid being commoditized: that's another source of inefficiency/surplus revenue. The market is in flux; commoditizing takes time.
- bawana 7y ago
- gowld 7y agoDreaming that other people would gift money to other people (including you) is not a sound economics theory. You are against join stock companies, but not interest bearing loans/bonds or arbitrarily high salaries for managers? Why?