[nero]

$this->bbcode_second_pass_quote('', 'T')he theoretical economic definition of a monopoly is a firm which limits supply in order to raise prices. Clearly that is not true of Standard Oil. It is true of labor unions however.

[threadbear]

$this->bbcode_second_pass_quote('jaws', 'Y')ou can pretend that Standard Oil had pricing power, the reality is that they didn't use it. In fact they used low prices to drive out competitors.

The entire argument against monopolies resides in their ability to command abnormally high prices. There is no case against Standard Oil.

[Dezakin]

This comparison in ideologies of role in government is somewhat orthoganal to the thesis that liberal trade is good. You can have total free trade with vast antitrust organizations and socialist market regulation just as you can have a total randroid society within the borders that charges exhorbant tarriffs and essentially destroys international competition.

As Ricardo illustrated so long ago, free trade is good. It doesnt mean there arent market failures, which is what Keynes illustrated, or that exploitive monopolies are good or bad. Thats role of government ideology and a different thing. Sure there are relations, but people try to tie them together at the hip and we end up with confused ideology arguments like this.

[Free]

$this->bbcode_second_pass_quote('jaws', 'T')he union is a company that is selling labor. The problem with unions is that they receive an exceptional power priviledge from the government. They have a government-enforced monopoly over their business. The buyer, the business who hires union worker, is not free to hire a non-union worker who is also not free to offer to work at a wage both parties find beneficial. If unions were truly competitive they would have to offer competitive wages that would eliminate unemployment.

[nero]

Unions gained restricted legal monopolies to redress the effective monopoly power of the large employer. Governments gave one organization a monopoly power to redress another organization's monopoly power.

It would have been better if instead they had destroyed the business's effective monopoly power instead of extending monopoly power to another organization. The government could have done this if they had placed strict limits on the ability of companies to grow and gain power over their suppliers of labor. If in the early days of capitalism we had recognized that we needed to forgo some economies of scale in the interests of maintaining competition we would all have a more equitable society. Unfortunately that horse has already left the barn and international competition makes sure we cannot corral that horse back into the barn. Instead , through free trade and market opening treaties we are forcing developing countries to follow suite. Eventually they also will give legal protections to their workers as well, however the proverbial "race for the bottom" is retarding the process.

[Dezakin]

$this->bbcode_second_pass_quote('', 'U')nions gained restricted legal monopolies to redress the effective monopoly power of the large employer. Governments gave one organization a monopoly power to redress another organization's monopoly power.

[nero]

$this->bbcode_second_pass_quote('Dezakin', 'L')arge employers aren't monopoly buyers of labor last I checked, except in small towns perhaps and even then everyone has the power to move.

[jaws]

$this->bbcode_second_pass_quote('nero', 'T')here is no necessity to raise prices to be a monopoly. You could equally be the sole buyer for your suppliers to be in a monopoly situation. If you use your market dominance to raise your profits you are acting in a monopolistic manner.

[jaws]

$this->bbcode_second_pass_quote('nero', 'U')nions gained restricted legal monopolies to redress the effective monopoly power of the large employer. Governments gave one organization a monopoly power to redress another organization's monopoly power.

[nero]

$this->bbcode_second_pass_quote('jaws', 'T')he problem with this theory is that they have no such power. They must always offer market-competitive wages or their employees will leave for other places.

[threadbear]

$this->bbcode_second_pass_quote('jaws', '')$this->bbcode_second_pass_quote('nero', '
')The only difference between a monopolist and perfect competition in the economic models used to justify anti-monopoly government action is the elasticity of demand. However any firm with dominant market share that doesn't have inelastic demand has absolutely no monopoly power. You can be the only existing provider of maple-flavored hamburger buns in the world, that doesn't make you a monopolist. People won't buy your product if it isn't priced competitively. To cartellize an industry with high elasticity is wasteful and pointless for everyone inside the deal.

[jaws]

$this->bbcode_second_pass_quote('nero', 'N')o you're missing the point that the market competitive wages are a result of the balance of power between the workers and the businesses. If workers are in a strong negotiating position they gain a larger proportion of the benefits from the trade in services. The fact that businesses have less competition for the worker's services than the worker has when seaking employment means the business is in a more powerful negotiating position than the worker and thus can gain a large fraction of the benefits from the trade in the worker's services.

[lakeweb]

$this->bbcode_second_pass_quote('jaws', 'T')he balance of power must always be even in that both sides of the agreement must have total freedom. That is the most even you can make it.

[jaws]

$this->bbcode_second_pass_quote('threadbear', 'J')aws, This doesn't make any sense to me. I'm not saying I think you're right or wrong here--I simply don't understand this paragraph.

[Zentric]

$this->bbcode_second_pass_quote('jaws', 'W')al-Mart is monopolistically competitive. They have the exclusivity over the brand Wal-Mart. They are also often the sole buyer for their suppliers. Target does not compete directly with Walmart, they target (har har) a different market segment. Call it upscale shoppers if you wish.

There's no one other than Walmart in the Walmart business: volume and affordability. If you want to start including other stores as competitors to Walmart, then you enter a process that is literally limitless. Anyone who sells food or ammunition or clothing can be a Walmart competitor.

The same will be true of Standard Oil if you apply the Walmart standard consistently. Standard Oil was not a monopoly because there were many other different ways of supplying yourself with energy. Every additional substitute for oil would affect the elasticity of demand for oil upwards, reducing Standard Oil's pricing power.

[threadbear]

Jaws, Well my good man, your last post broke the silliness barrier. Wal Mart isn't a monopoly at all but the strongest player in it's field. I challenge you to provide any links to back up your assertion that it IS a monopoly.

I figured that if I kept at it, I could pin you into a corner and expose the lame assumptions underlying your free market drivel. I'm not going to counter your post point by point, as that's how you "defeat" your opposition. You draw people into arguments where their central premise is lost in a sea of your obfuscating jargon. I nailed you good, Pal, fair and square. Let others observe for themselves.

[jaws]

You still don't know what a monopoly actually is, Threadbear. You call me obfuscating but I haven't used any terms that aren't basic concepts of economics. Perhaps you need to pick up a few books before you pretend to be knowledgeable about the subject. Failing that, ask me what specific concept you fail to understand and I'll do my best to illuminate it for you.

[threadbear]

That was very civil. You might start by explaining the term"monopolistically competetive", as I haven't read my recently purchased copy of Oxymorons for Dummies.

Look, I promise to back off if you'll just admit that like Communist theory, free market ideas and formulas that support globalization are more religion than anything else. Macroeconomics provide a handy altar that sacrifices the unique and the powerless. The Communists did the same thing to appease their God of "egalitarianism", the NWO capitalist fascists do it to appease their God of "democracy and reform." Who is kidding who?

[Zentric]

$this->bbcode_second_pass_quote('jaws', 'Y')ou still don't know what a monopoly actually is, Threadbear. You call me obfuscating but I haven't used any terms that aren't basic concepts of economics. Perhaps you need to pick up a few books before you pretend to be knowledgeable about the subject. Failing that, ask me what specific concept you fail to understand and I'll do my best to illuminate it for you.

[nero]

$this->bbcode_second_pass_quote('jaws', 'T')he balance of power must always be even in that both sides of the agreement must have total freedom. That is the most even you can make it.