Are monopolies actually a good thing?

[hmkpoker]

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A free society/market always selects against violence, and a monopoly on violence always grows in power (breeds violence).

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So long as there isnt any money to be made in it.

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War really isn't all that profitable for consumers, dude. Violence is highly profitable in poor regions, which have low defenses and few demands, but as the resources in the area increase, trade simply becomes a more effective way to get what you want. This phenomenon explains how barter markets evolved from Hobbesian anarchy; there were enough products in the system to make people have a low enough time preference to stop taking actions that would make other hostile toward them (and the advances in technology were making their hostility increaingly unfavorable)

No one wants war. It doesn't make you richer. As resources increase, there becomes less reason for war to exist. The only way they can still exist is if people are terrified into thinking they are being attacked and need to unite against East Asia, er, Iran.

Without the presence of war and violence, the government cannot convince people that it has any reason to exist.

[canis582]

"This leads me to accept the idea that unchecked capitalism always leads to a monopoly."

This assumes effiecent markets, which I can tell you they are not.

Also, many monopolies are given to certain companies by the government.

[theweatherman]

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No one wants war. It doesn't make you richer

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I disagree. The UFC certainly favored the government intervention of the marine corps to ensure their dominance in Latin America.

Why would a company not want war if they can get the government to pay for it and they benefit from the opening ofnew markets/resources? If I can convince the government to invade Cuba so that I can open a new cigar factory there why would I not want war?

[hmkpoker]

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If I can convince the government to invade Cuba so that I can open a new cigar factory there why would I not want war?

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You mean so that you can overcome the unnecessary trade embargo put their by government in the first place?

[theweatherman]

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If I can convince the government to invade Cuba so that I can open a new cigar factory there why would I not want war?

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You mean so that you can overcome the unnecessary trade embargo put their by government in the first place?

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Sure, would it not be beneficial for a company to support a war to do this?

Another example. During the height of the imperialist era companies were profiting from trade in far flung nations. The population ofthese nations were sometimes very, very hostile to these foreigners. In many cases Government troops were used to ensure peace so that these companies could operate. I do not doubt that these corporations could have hired their own security force, but if the government is willing to do it for free why should they bother?

Obviouslythe taxes the company pays is going in part to htese troops, but it is certainly not paying for all of them. Even your competitors are paying to keep your assests safe from attack. Why would a company ever not support this?

[Nielsio]

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A free society/market always selects against violence, and a monopoly on violence always grows in power (breeds violence).

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So long as there isnt any money to be made in it.

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What?

[nietzreznor]

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Sure, would it not be beneficial for a company to support a war to do this?

Another example. During the height of the imperialist era companies were profiting from trade in far flung nations. The population ofthese nations were sometimes very, very hostile to these foreigners. In many cases Government troops were used to ensure peace so that these companies could operate. I do not doubt that these corporations could have hired their own security force, but if the government is willing to do it for free why should they bother?

Obviouslythe taxes the company pays is going in part to htese troops, but it is certainly not paying for all of them. Even your competitors are paying to keep your assests safe from attack. Why would a company ever not support this?

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Well, yes, when organizations (be it large corporations or governments) can externalize their costs, war starts to look pretty good. This is why its much much easier for governments to go to war against each other (or their own citizens) than, say, private competing security companies on a free market.

If you are pointing out that big corporations make a large amount of money, and keep smaller businesses out of competition, by using government advantages (including war), then I couldn't agree more.

[ianlippert]

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What you're talking about are not monopolies but dominant firms. Monopolies only exist where competitors are *prevented* from entering a market by government regulation (artificial barriers to entry).

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It seems to me that people equate dominant firms with monopoly. I guess the way I described it monopolies are good just by the definition I gave. In his book DiLorenzo gave the example of the railroad 'robber barons', it seems like people just have an aversion to monopolies.

What is so bad about big corporate mergers? Does the fact that oil is controlled by a few large corporations allow them to gouge consumers? What was the deal with the microsoft Anti-trust case?

[Borodog]

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What you're talking about are not monopolies but dominant firms. Monopolies only exist where competitors are *prevented* from entering a market by government regulation (artificial barriers to entry).

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It seems to me that people equate dominant firms with monopoly. I guess the way I described it monopolies are good just by the definition I gave. In his book DiLorenzo gave the example of the railroad 'robber barons', it seems like people just have an aversion to monopolies.

What is so bad about big corporate mergers? Does the fact that oil is controlled by a few large corporations allow them to gouge consumers? What was the deal with the microsoft Anti-trust case?

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Uh, no offense, but did you actually read the book? He goes into great length on specifically the oil and energy industries, as well as the microsoft antitrust case. He also makes clear that the "robber barons" were not capitalists but rather mercantilists, and specifically mentions John Hill, who built his Great Northern transcontinental railroad without a penny of subsidy, paid for every mile of right of way out of his own pocket, including to the native american tribes (where the US government's plan was simply to wipe them out to make way for subsidized railroads), and built a highly profitable transcontinental RR that was the only one to never go bankrupt (where all the subsidized roads did; some as soon as they were built).

[ianlippert]

ya I did read the book [img]/images/graemlins/smile.gif[/img]

I guess the point im trying to make is that a lot of people (not me) think the total opposite of what DiLorenzo writes. Just the other day I was reading slashdot, and somebody made a post referencing 'monopolistic robber barons'. It doesnt seem like anyone is willing to make any arguements for that point of view.

I'm trying to come up with arguements that would refute DiLorenzo (mabey that makes my post sound a little schizo) just to see if they can hold up. I was hoping to get some back and forth going with this post, doesnt seem like it is going to happen.