And yes, not every regulation destroys monopoly, but regulation is the only thing that could break one.
No. Monopolies are only inevitable if the goods aren't elastic, if there is a large cost of entry into the market, or if its a market you can create a moat that is unsurmountable.
Many markets don't have that even with 0 regulation, but might have second order problems like firms creating unsafe products for example.
But in general regulations almost always even unindentedly raise the cost to enter the market. If you make a new regulation that food needs to be safe, then the company needs to pay a safety inspection that a small home-made recipe might not be able to afford (to give a simple example).
At the same time, we now have uber large corporations due to non elastic parts of supply chain (like land) or moats that are insurmountable (like access to US capital). In which case, the FCC should break up monopolies as the current market is not catering to end users and consumers but to owners, which is why the Stock market has been in a never ending bull run.
That is one of the ways a Moat can happen and a monopoly can occur. For example if you were the only person with a loom and everyone else had to make jumpers by hand, you could make them so cheap they would have to close down.
In some markets those ways you can benefit from scale exist, in others there are drawbacks. In many cases those advantages only exist due to either regulation or lac thereof.
For example ways companies might have an advantage is by manufacturing in cheaper countries, but that only works because those workers have less rights and the cost of transporting is not properly taxed. Carbon taxes on shipping would make manufacturing in China pretty comparatively priced to many european countries. But if you let them contaminate the ocean with crude oil boats, then their manufacturing prowess and cheaper labour cost will offset the shipping cost and destroy a newcomer.
These are very basic examples and they all require nuance but hope it helps to explain it a bit more.
Another example is restaurants, you used to have some advantages from being a chain, but you would still constantly see mom and pop joints compete and even win. But as rent prices keep increasing (the non elastic market of the ground under the lease), suddenly the advantages of scale start beating the disadvantages of worse food and service.
Groklaw was a website that was started by a paralegal to try to understand, explain and report on the SCO lawsuit - who benefited and how they benefited. It ended up expanding into the EU anti-trust action against Microsoft and OpenDocument (and how OpenOffice was created as a trojan horse to defang OpenDocument).
This ad hominem stuff is genuinely worthless.
I've yet to see anyone counter the basic points of that post, because they look pretty solid. Happy if you have a non-vibes based rebuttal.
The same could be said for people who suggest regulation for every problem that comes up, even for problems that were caused by regulation. Maybe we have our blindspots, but the "regulate everything" crowd is much louder and more prevalent on HN than the free market absolutists.
In econ the easiest part is to create a model, the hardest part is seeing it crash against reality. But the basis of monopolies seems to be pretty thoroughly tested. The biggest issues you have now are Chesterton Fence's. Were its hard to know what laws and regulations are therefore safety, parity and economic performance and ones are only creating friction with no benefit due to years of laws being put on top of other laws
> I know "chesterton fence", I smart
4chan greentext style over substance is cute, but its outdated and wasnt that funny a decade ago
if you have nothing to add, then why reply?
I am pro-regulation, where regulation for me is busting monopolies, preventing tragedy of commons, setting necessary quality checks, forbidding forced labor. I am against regulation, when it's chat control, 100% tarrifs on whatever, forbidding working on Friday past 17:00 and completely on Weekends. < Why do I even have to point this out?
There's no nuance remaining in this world, people (the proselytizing nerd types) emotionally attach themselves to sophistry that is the spelled-out economic theories, while completely disregarding common sense. Missing forest for trees.
In short - fuck America.
first comment was both cheeky and had a "i agree" at the end. Those are both niceties. Not sure why I would have to explain tone from mild critique to being a wee cu nt in back to back messages
> I am pro-regulation, where regulation for me is busting monopolies, preventing tragedy of commons, setting necessary quality checks, forbidding forced labor. I am against regulation
What does any of this nonsense have anything to do with me replying to someone who had a basic question about the non existance of monopolies in unregulated markets?
I explained the basic mechanisms for monopoly creation which are all easy math formulas that happen in bacteria growth too because "if nothing stops me I eat everything" is equally valid in any env where there is growth
> There's no nuance remaining in this world
coming from anti-intellectual "oh you know chesterton fence" responses is pretty ironic.
Btw if you are going to call people out for using big words maybe dont come out with the most 17 year old "people arent as smart as me as they emotionally attach themselves to sophistry while I am a nuanced rational ubermench". It reeks of intellectual insecurity.
i asked for empirical evidence against the mechanisms of monopoly creation because moats, regulation and inelastic markets are the most studied and reproducible mechanisms in anture, economics and any growth env. The formula just converges to infinity
> In short - fuck America.
its like 3am there, everyone here is asian and european rn... you are fighting windmills
A lot of these were international. Just read up on "Cartel capitalism".
https://www.cambridge.org/core/journals/enterprise-and-socie...
The European Steel and Coal Community (precursor of the EU) was also involved in the effort to stop these. In general this has been something the EU has been involved in since its inception and the best action against monopolies is to not let them form in the first place (why there is so few of them in general in most developed countries. Though that is now slowly changing it seems)
Keep in mind that just having a big market share isn’t a monopoly, being able to charge monopoly prices is.
No.
A better answer would be 'not always'.
The proposed regulations forcing everybody to use google or apple are ridiculous and very much the opposite of the kind of regulations we need though...
(nit: I assume you meant "marketshare becomes unavailable")
So you mean that regulations that are created based on lobbying by corporations help them become monopolies? Sure, that makes sense. But thats different from a blanket "Regulations create monopolies".
The only way to guarantee a monopoly is to have a total lack of regulation. It's known that every "free" market will tend towards monopoly due the 1% law. Regulations are the only way to actually guarantee free markets because perfect free markets only exists in abstract, not in reality. Sometimes, a free market is the wrong solution and you need a regulated monopoly instead and with identity that's the best solution. Why? Because identity is unique to the individual. A individual must (in theory) only have one identity and with very extreme and usually well documented exceptions, such identity doesn't change. The state is the one that must provide a good way for identity and if smaller countries doesn't have the resources, then big countries should provide for all. Also, it removes incompatibility inter-countries while keeping private interests out.
The state should have the sole monopoly on attesting to anyone identity. Because they are the only ones that are not affected by market conditions. This is how countries that have advanced in this topic actually work. If individual states can't reach a common solution, then the collective must do so. The collective failed here because it recommended a private solution rather than mandated a european one. Private sector must not dictate what or how identity is attested, because the private sector has it's profit pursuing agenda, state must evaluate solutions but it's up to the states to run them and implement them.
Market solutions are good for several things, this isn't one of them.
Electing to not do something impossible and framing it as a surrender is strange to me.