The fact that other society models are worse isn't relevant to my analysis. Capitalism is so far the best societal model, but that does not imply perfection. M

The fact that other society models are worse isn't relevant to my analysis. Capitalism is so far the best societal model, but that does not imply perfection. Monopolies arising naturally do not imply that, for the society, the monopolistic status is the most efficient. It is the most efficient for the monopolist. Think of it as a local maximum. This is microeconomics 101. If an investment in investigation produces mostly positive externalities, then the investor will not recoup his investment, even if the end result is better for the society as a whole. As such, these investments will not occur in free form capitalism, even though they would be positive for the society as a whole. I'm purposely removing risk from the analysis, as it does not affect the conclusion.