To Bail or Not to Bail...

[iKotomi]

Ok. So once we do away with intellectual properties (among other pesky noncompetitive practices like anti pollution statutes etc), we'll have a free market for the first time ever?

That wasn't the point. You just made a totally bunk statement that free markets create monopolies which is about as far from the truth as possible.

 

[Marginal]

That wasn't the point. You just made a totally bunk statement that free markets create monopolies which is about as far from the truth as possible.

Then you said that stuff like patents (intellectual property) helps artificially create monopolies.

You'd be better off explaining how Standard Oil either wasn't a monopoly, or how it was built by the government.

 

[iKotomi]

Patents do create artificial monopolies. There is nothing you can really argue against, as that is a positive, not normative statement. If you invent something and you don't have patent laws, you think that the market would just be nice to you and let you scoop up all the profits? I don't think so. Patents are just legal documents that prevents people from copying your idea. There is quite literally nothing else stopping another person from using that idea to better effect than you are, and ultimately create inefficiencies. Again, that is a positive, not normative statement.

Yes Standard Oil, US Steel were monopolies that weren't created because of government interference. Note how companies like that are few and far between, and even then, they don't remain monopolies in the long run. Monopolies exist because the monopolist can exclude competitors. This can be because of prohibitively high startup costs, as well as very limited resources, as the case was with standard oil. It's a little hard to compete against a monopolist in the oil industry because you can't just set up a factory anywhere you want and start producing oil.

Markets like that however, are exceptions and not norms. I'd prefer not to start nitpicking at the abundance of natural monopolies in infra-structure heavy industries like energy, telecommunications, etc. If you want to say that most markets follow that example, than I can't really argue against you, except say that they don't.

I'm just pointing out the economic facts, and have not really infused any opinion. Note that I never said that we shouldn't have patents. They create an incentive to think of new ideas, and that's a good thing. But nothing changes the fact that they are an artificial barrier to entry into a market.

 

[Marginal]

Yes Standard Oil, US Steel were monopolies that weren't created because of government interference. Note how companies like that are few and far between, and even then, they don't remain monopolies in the long run. Monopolies exist because the monopolist can exclude competitors. This can be because of prohibitively high startup costs, as well as very limited resources, as the case was with standard oil. It's a little hard to compete against a monopolist in the oil industry because you can't just set up a factory anywhere you want and start producing oil.

Especially when that company's actively working to shut any competition down as well. I do wonder how long they would've held on without government interference.

Markets like that however, are exceptions and not norms. I'd prefer not to start nitpicking at the abundance of natural monopolies in infra-structure heavy industries like energy, telecommunications, etc. If you want to say that most markets follow that example, than I can't really argue against you, except say that they don't.

Doesn't that really depend on the operators in the business? The sure way to ensure success is to remove your competition.

Are newspapers a natural monopoly?

I'm just pointing out the economic facts, and have not really infused any opinion. Note that I never said that we shouldn't have patents. They create an incentive to think of new ideas, and that's a good thing. But nothing changes the fact that they are an artificial barrier to entry into a market.

Yes. What I'm curious about now is, was there ever an operating free market? Just sounds like a pie in the sky economic form of anarchism the more I hear about it.

 

[Egg]

Marginal Master of the Multi-Quote. People have tried copying him in the past, all have failed. Please continue I have nothing intlectual to add. Except for it turning into Socialism for the wealthy.