Re: Against pvn, Part 1
 

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This is false. The very definition of a monopoly is that you cannot buy widgets from any other company than company X, even if you need widgets. For example, replace Imtel with "FoodCorp" and you'll see what I mean. Recognize that monopolies are created where goods have no economic substitute, such as in oil and computer components, so this "consumer choice" you speak of is bogus. It's the very lack of consumer choice that creates the monopoly.

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Imtel doesn't have exclusive control of the supply. They are not a monopoly.

A lack of competitors is not necessarily a lack of competition.

Imtel's actions that hurt competitors are not necessarily actions that hurt competition.

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What's the harm?

Monopolies lead to less competition.

Less competition leads to an inefficient market.

An inefficient market leads to an inefficient allocation of resources.

An inefficient allocation of resources leads to a smaller economy.

A smaller economy == teh bad.

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Fine, but there's no monopoly shown here.

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You can be an anarchist. That's fine. But you can't sit there and say a complete laissez-faire market is the most efficient way to run an economy. Unless, of course, you'd like to elaborate on the idiocy of Keynesian economics.

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Elaborating on the idiocy of Keynesian economics is not difficult, but could be quite time consuming.

We could start by pointing out the Keynesian tendency to ignore prices and microeconomic details and focus only on aggregates.

The real problem with Keynesian theory, though is the idea that goverment intervention can reduce unemployment at the cost of increased inflation, or that intervention can reduce inflation at a cost of increased unemployment.

Think about that. The central idea is that by *causing* inflation, by interfering with the proper processes through wich prices are set, that somehow production will increase and unemployment will decrease?

In an unregulated market, unemployment is only caused by one thing - the voluntary decision of the individual to remain unemployed. That decision might be made beause the individual is holding out for a higher wage, but the fact remains that his decision is voluntary. The same can be said for idle production capacity (factories, etc).

Keynesian economics thrives because it justifies government bureaucracy and interventionism. It assumes that people left to their own devices will not be able to sustain an economy. It teaches that government intervention is the only way to prevent inflationary boom and bust cycles. It ignores that such cycles are actually *created* by government intervention in the first place.

Keynesian theory will continue to be pushed because a bureaucrcay will never advocate a system that would advance its own dismantling.

Re: Against pvn, Part 1
 

ok.

Re: Against pvn, Part 1
 

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Unless, of course, you'd like to elaborate on the idiocy of Keynesian economics.

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Unnecessary, unless you need the idiocy of Intelligent Design explained to you as well...

natedogg

Re: Against pvn, Part 1
 

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This isn't a counterexample. It's a hypothetical. If what you propose were actual inevitable reality, you would have no trouble finding an actual counterexample instead of having to make one up.

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Actually, since there are currently laws that prohibit these scenarios from unfolding, it's impossible for me to cite examples without a deeper knowledge of economic history than I have. You should be the one able to point to the real-world costs of antitrust laws.

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To address your points specifically, when PVN corp goes under, there are assets - both knowlege and tangible assets - that can be snapped up by other competitors which make their startup costs much less than PVN corp's costs were.

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This doesn't really change the situation. No matter how cheap the initial investment, it's no bargain if the enterprise is going to lose money.

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Your explanation of Imtel's behavior doesn't particularly impress me. So they drive out all competition, then raise prices. Apparently, while there is no competition, people are still buying Imtel's product. Where is the problem? The consumers are voluntarily buying, they must not find the prices too high, else they would not purchase Imtel's product. They are voting with their wallets, and their votes say that they feel that they are benefiting from the transactions.

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The problem is that there will be no incentive for innovation or adaptation to the desires of customers. This is often felt to be a bad thing.

Re: Against pvn, Part 1
 

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Furthermore, your characterization of "Imtel" as a monopoly is false. In your hypothetical, Imtel has no government-granted protection from competition, nor do they have complete control of the supply of the commodity (as evidenced by PVN corp's attempt to compete).


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Would your opinion change if Imtel was able to buy up the world's supply of silicon? (You can change the details to something less ludicrous if you like)