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Your notion of competition in the free market is sorta like the frictionless spherical horse in the physics joke. A successful product will produce more profit
by ido 5y ago
Your notion of competition in the free market is sorta like the frictionless spherical horse in the physics joke. A successful product will produce more profit than your hourly rate.
- captainmuon 5y agoYeah, of course it is idealized. You know the joke: two economists are walking down the street. One sees a $50 bill on the sidewalk and says to the other: "Did you see that $50 bill on the ground?" - "Can't be, if it was there someone would have picked it up!" Long term I think it is true, though. If you don't have any unique advantage, competition will drive down your revenue to "market" rate. But that's kind of idealized equlibrium, of course there are successful products, innovations, and so on.