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Old 07-05-2007, 04:54 PM
pvn pvn is offline
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Join Date: Jan 2004
Location: back despite popular demand
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Default Re: Why aren\'t there more private roads?

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You've neglected that a road has a certain capacity. And the bigger the road, the higher that mainenance price will be.

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No, I did not ignore that, I wrote:

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A natural monopoly is caused by economics of scale. It is typical for products that have a high cost for the first produced unit and low cost for the marginal produced unit.

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I also mentioned that it was more likely if physical features like passing rivers of mountains and rivers were in place. If the added investment cost or maintenance cost caused by additional passings is relatively high, then my whole example collapses.

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It would be more accurate to say that unless the added investment cost or maintenance cost is relatively low, your example collapses. Because the vast majority of the time that's going to be the outcome. The fact that you can make up some numbers doesn't actually show anything. I can make up numbers for the density of the sun that would demonstrate that it should collapse into a black hole, however, it will not do so just because I make such numbers up.

Further, making up such numbers doesn't give me a license or a justification for engaging in aggressive, coercive behavior.
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