4 ms·

Eh. Retail is only one type of business. The fraction of businesses that are small fluctuates by a couple percent here and there but isn’t on some long term dec

Eh. Retail is only one type of business. The fraction of businesses that are small fluctuates by a couple percent here and there but isn’t on some long term decline. How is it to our long term benefit to continue paying more for goods forever? Maybe we’re just better off in a world where industries that have severe economies of scale like retail get consumed by the big guys so we all save money, and small businesses keep fixing the pipes, designing our graphics, etc.

CubsFan1060 2y ago
I can't back this up with data, so this is just my opinion. Economies of scale are better in almost every way, if the benefits of economies of scale are somewhat evenly distributed, and that the benefits don't come with significant negatives somewhere else. However, most of the time, the majority of the benefits of economies of scale tend to go to the wealthy. The small amount of benefits that do go to consumers/people make them think that they are the beneficiaries, and often the societal cost is masked.
- foxglacier 2y ago
  It should be OK if those big companies are publicly traded and mostly owned by ultimately, lots of individuals, say through retirement funds investing in them?
- mattmaroon 2y ago
  Lots of small businesses exist in areas that do not have economies of scale, and sometimes have diseconomies. Think businesses where labor is the majority of the costs. Your local plumbing company is probably a small to medium business and Roto-Rooter isn’t hurting them. Some have some economies of scale but not severe and service or quality or other things matter and there you usually find big businesses and small competing with each other. (I work in the packaged food world, it falls into this category.) And some, like retail, have such large economies of scale that a small business just can’t really compete. In the case of retail, this is largely because of logistics being such a big portion of cost of goods.

CubsFan1060 2y ago

I can't back this up with data, so this is just my opinion. Economies of scale are better in almost every way, if the benefits of economies of scale are somewhat evenly distributed, and that the benefits don't come with significant negatives somewhere else. However, most of the time, the majority of the benefits of economies of scale tend to go to the wealthy. The small amount of benefits that do go to consumers/people make them think that they are the beneficiaries, and often the societal cost is masked.

foxglacier 2y ago
It should be OK if those big companies are publicly traded and mostly owned by ultimately, lots of individuals, say through retirement funds investing in them?
mattmaroon 2y ago
Lots of small businesses exist in areas that do not have economies of scale, and sometimes have diseconomies. Think businesses where labor is the majority of the costs. Your local plumbing company is probably a small to medium business and Roto-Rooter isn’t hurting them. Some have some economies of scale but not severe and service or quality or other things matter and there you usually find big businesses and small competing with each other. (I work in the packaged food world, it falls into this category.) And some, like retail, have such large economies of scale that a small business just can’t really compete. In the case of retail, this is largely because of logistics being such a big portion of cost of goods.