Jeff Bezos’s Master Plan

>To the extent this makes a difference

It does, because you're arguing as if Amazon sells stuff. It doesn't (just) do that: it's a market-maker that provides a venue for other vendors to sell stuff.

So it's already an error to talk about Amazon as a monopolist, when Amazon isn't the only marketplace out there with a global reach. But you're also making a category error, because you wrote:

>A perfect monopolist, by setting monopoly prices, decreases the value of the price information it gets through transactions, because there are no other competitors offering the same goods at different prices to compare to, so the prices of the monopolist's transactions convey less information about the preferences of other market participants.

Amazon doesn't set prices per se, at least not for vendors in its marketplace that are not itself. So it doesn't do whatever you think it's doing when you were writing that paragraph. Certainly there are "other competitors offering the same goods at different prices to compare" with, because Amazon's marketplace include other vendors. But Amazon is running a marketplace, not (just) being a vendor. There's a difference in category there.

That's not what a market maker is. A market maker is a market participant that guarantees to buy or sell something if no other buyer or seller can be found.

Providing a venue for others to sell stuff is a straightforward market transaction: Amazon sells its services to others for a price. There's nothing special about it, and standard Hayekian economics accounts for it just fine.

> Amazon doesn't set prices per se

To the extent this is true (as you say, for vendors that are not itself), it just reinforces the point I made above: that what Amazon is doing as a "marketplace as a service" is just a straightforward market transaction, selling services for a price, and does not give Amazon any sort of special status.

> Amazon is running a marketplace, not (just) being a vendor.

Running a marketplace, if it does not mean being a monopolist (which you are insisting it does not), is being a vendor, a vendor of particular services.

>I think this is true, but it's a much, much weaker claim than the one you have been making.

I think you need to stop identifying me with the author of the article. My original comment was to make fun of the author for his ludicrous comment about Marxists calling it a day after nationalizing Amazon, which got some Marxists riled up:

>Perhaps we need to break up Amazon because communism? /s

The comment you replied to in starting this conversation spelled out exactly the same argument you made above:

>So a communist economy, in Marx's sense, is also an economy in which there's perfect information. That can't possibly happen in the real world, of course, and Hayek correctly points this out about a centralised bureaucracy.

So the "much, much weaker claim" is the one I have always been making.

>>> Unlike the monopolies of old, which may have 1) to some extent, Amazon also has 2), and is trying to acquire 3) with its Amazon Business offering

>Wrong again. Amazon has none of those three, nor has any other monopolist in history.

It's exhausting to have to always qualify my statements. Of course I did mean "Amazon also has 2) to some extent, and is trying to make inroads into acquiring 3) to some extent".

>> Amazon does collect and process information that a market participant wouldn't normally have: consumer preferences.

>This is wrong. A market participant does normally have information about the preferences of other market participants. That's precisely the information conveyed by market transactions, buying and selling certain quantities of certain goods at certain prices.

No, this is wrong. Amazon collects information about the preferences of market participants through non-market non-priced transactions as well. Here's a non-exhaustive list of such information collection:

- information from consumer responses to recommendations made by the recommender system

- information from consumers immediately after they've clicked on a link supplied by an Amazon associate, which then directs them to a product page.[0] Yes, there is a market transaction between Amazon and its associates, but at the time of the click, the information isn't generated from a market transaction between Amazon and the consumer.

- information supplied by consumers themselves through Amazon Lists, listing explicitly their preferences for goods and services.[1]

- information supplied by consumers themselves about their social network and preferences through Amazon Wish List.[1]

This is evidence for suggesting that "Amazon also has 2) [to some extent]", possibly to a greater extent than any monopolies of the past century has ever had.

[0] https://affiliate-program.amazon.com/

[1] https://www.amazon.com/gp/aw/ls