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So company profit margins should be capped? At what level and how would that work exactly? What about all other stuff? i.e. maybe you or somebody else can "aff
by Wytwwww 2y ago
So company profit margins should be capped? At what level and how would that work exactly?
What about all other stuff? i.e. maybe you or somebody else can "afford" to sell their labour at 10-80% of what they are paid?
- Sabinus 2y agoIf NVIDIA had real competition they would do this naturally to gain market share. The GP saying they 'should' do x isn't something we can expect companies to do out of the goodness of their hearts, it's what the market should force them to do.
- Jlagreen 2y agoNo, they wouldn't. Nvidia focuses more on premium and margin than on unit share. Nvidia looks at Apple. Apple has 75% of profit share with 25% of unit share of the whole smartphone market. Apple makes 3x more profit than all other smartphone makers combined. Why should Apple reduce pricing in such a situation?
- Wytwwww 2y agoI'm not sure if everything turning into a commodity and no companies having any surpluses would be ideal either. That would probably significantly slow down innovation in some ways.
- dragonwriter 2y ago> So company profit margins should be capped? At what level and how would that work exactly? That a competitive market drives prices to zero economic profit is a fairly basic result; no active measures besides the existence of competition are necessary for this. > What about all other stuff? Yes, this applies in all competitive markets. If it doesn't apply in a market, there is a constraint on competition causing it.
- Wytwwww 2y ago> prices to zero economic profit is a fairly basic result Yes and that's not necessarily a good thing in all markets. Very low profit margins can result in less innovations and would certainly discourage companies from taking risks (basically by definition)