6 ms·

A few large firms competing with each other is very different from a monopoly. Some of the things you mentioned have reasonable competition (phones, TVs, cars)

A few large firms competing with each other is very different from a monopoly. Some of the things you mentioned have reasonable competition (phones, TVs, cars) and some are deeply steeped in anti-competitive practices (medicine, public transit). Your argument was used to make Boeing into a monopoly and look how that turned out. It's easy to cherry-pick examples for either side, but I'd say take a step back and look at the trends and which way the evidence favors. At the end of the day it all comes down to incentives - and what incentive does a monopoly have to compete?

Barrin92 6y ago
> few large firms competing with each other is very different from a monopoly. very true but that's what we've been talking about in the comment chain, there's no actual global monopoly or one static entity, hence the explicit reference to Schumpeter's 'monopolistic competition'. There is still competition between large firms, but the dynamism is temporal, few firms for years or decades seize outsized marketshare to dominate and innovate sectors before being replaced by other substantial firms, rather than a sort of bazaar economy of small firms competing at the same time. It's myspace being superceded by facebook maybe being eaten by tiktok that's going to drive technological innovation in social media, not mastodon instances. Of course it's easy to cherry-pick, but you don't need to cherry pick. You can look at the economic development in mature economies vs developing economies. This tendency towards consolidation and innovation occurs in every single one. That's why South Korea and Japan have more large firms and are more productive than most of their Asian peers, it's why China with its economic model has outgrown India, where the same process is occuring now (see Jio).

6 ms·

A few large firms competing with each other is very different from a monopoly. Some of the things you mentioned have reasonable competition (phones, TVs, cars)

by Judgmentality 6y ago

Barrin92 6y ago
> few large firms competing with each other is very different from a monopoly. very true but that's what we've been talking about in the comment chain, there's no actual global monopoly or one static entity, hence the explicit reference to Schumpeter's 'monopolistic competition'. There is still competition between large firms, but the dynamism is temporal, few firms for years or decades seize outsized marketshare to dominate and innovate sectors before being replaced by other substantial firms, rather than a sort of bazaar economy of small firms competing at the same time. It's myspace being superceded by facebook maybe being eaten by tiktok that's going to drive technological innovation in social media, not mastodon instances. Of course it's easy to cherry-pick, but you don't need to cherry pick. You can look at the economic development in mature economies vs developing economies. This tendency towards consolidation and innovation occurs in every single one. That's why South Korea and Japan have more large firms and are more productive than most of their Asian peers, it's why China with its economic model has outgrown India, where the same process is occuring now (see Jio).