How to exploit monopolies and distort markets
Here are a few ways in which a company can exploit a strong market position to extend an existing monopoly, eliminate any remaining competition, and extract the greatest revenues at the lowest cost. (more…)
Income inequality and incentives
at 6:21 am on Monday, 16 April 2007
An article by Robert H Frank on trickle down economics in the NY Times points out that there is little correlation between high earners pay and how hard they work. This is backing for my views on directors pay. (more…)
How the economy should work
at 9:02 am on Friday, 13 April 2007
Fabian Tassano has responded to my post on the problems of the emergence of monopolies and oligopolies in more and more markets. He appears to think it is less damaging than I do, and he also wants to know what I think the best alternatives are. (more…)
Private monopoly vs public monopoly
at 9:53 am on Thursday, 12 April 2007
The most sane (albeit not against a very high standard) of a number libertarian (or, at any rate, very pro-market) bloggers in Britain that I read, admits that network effects mean that many markets tend to “collapse” into monopolies. I would add that many more markets tend to become oligopolies or cartels. In the face of this, why does he still believe that leaving everything to the markets is the best way to run an economy? (more…)
Low taxes do not attract investment
at 9:25 am on Thursday, 12 April 2007
It appears that cutting corporate taxes does not make a country more attractive to investors. I do not find this surprising. The long term benefits of the right government expenditure (on education, infrastructure and health, for example) are obvious. So why are governments so keen on tax cuts? (more…)
Technology subverts more markets
at 8:06 am on Saturday, 7 April 2007
It looks like it is not just consumers who are unable to make informed rational decisions when faced with technology. It appears that Indian cotton farmers have a similar problem when faced with choosing GM seed varieties. In this case as they would clearly wish to choose according to rational criteria, but they cannot.
Innumerate Polly
Anyone even vague numerate reading this article by Polly Toynbee would would have probably spotted where it went wrong. It is very hard to read it without thinking “surely that £5bn must be a reccuring annual amount whereas as she is comparing it to one off amounts”. David Smith confirms that this is the case. (more…)
Where’s the perfect competition?
at 7:57 am on Wednesday, 4 April 2007
This post at Economist’s View touches on a problem that bothers me. The assumption by economists and policy makers that markets are competitive and efficient. (more…)
Free market hypocrisy: Part 2
My previous post on hypocrisy about free markets may given the impression that I am opposed to free markets. My problem is not with free markets per se, but with inconsistency and hypocrisy in advocating them, and with regarding free markets as a panacea. (more…)
Free market hypocrisy
This change of heart on the benefits of outsourcing is, to me, just another example of both the hypocrisy of many supposed free markets advocates. Everyone seems to favour free markets, but as Adam Smith himself pointed out, no one wants free markets to apply to themselves. Everyone wants free markets their own way. (more…)
