Middlemen (e.g. wholesalers and retailers) serve a valuable function. Imagine each consumer having to maintain relationships with hundreds of factory owners and tens of farmers.
Up to a point, yes. Utility tends to follow a sigmoid curve.
An Economy of Overfed Middlemen
21–30 of 160 posts
Re: An Economy of Overfed Middlemen
#22Middlemen (e.g. wholesalers and retailers) serve a valuable function. Imagine each consumer having to maintain relationships with hundreds of factory owners and tens of farmers.
Consumers and producers can form cooperatives. They are middlemen, but not overfed ones.
Re: An Economy of Overfed Middlemen
#23One thing we have to ask is the monopolization the problem?? Do we want to break monopoly up in favor of a bunch of possibly shittier products? The real problem It's not the monopoly it's the Monopoly tax.
There's a large body of economic literature arguing that competition breeds efficiency and better service. Granted it's only starting to grapple with the question of how to regulate the new economy - c.f. Lina Khan's paper on Amazon which made quite an impression [1] So it's not clear that breaking up a digital marketplace monopoly would result in shittier products, tho I agree that the theory is less clear cut than…
This is one of those weird things where in principle, a monopoly should be both interested in providing the best possible service (to keep their position indefinitely, even through technology shifts), and in a unique position to invest in research to make it so (under competition, it's harder to invest in research.)
In practise, that's not what happens.
Re: An Economy of Overfed Middlemen
#24Sometimes I wonder if 'monopoly' in the US has become a no true Scotsman fallacy. The threshold of direct consumer harm is either so high or evidence requirements so onerous it's as if there is no more Sherman Antitrust Act. The monopolizing doesn't even have to be in a computer or layers of shell companies anymore.
That was the entire point of the Borkist/Chicago school movement. The capitalists knew they'd never be able to repeal those laws legislatively, so instead they changed its enforcement by winning the minds and wallets of the judiciary. Now they can consolidate as much as they want to, no judge will stop them and most lawyers won't even try.
Re: An Economy of Overfed Middlemen
#25Everyone from Sam Altman to Peter Thiel has been talking about this for years. Capitalists are very straightforward about this - if you want to capture value, find a way to plant your flag in some emerging market and get a monopoly on one or more parts of the value chain. Marketplace operators are especially attractive to investors, because the financials are really pretty - the marketplace provider doesn't own signi…
They do some organizing of information via their apps, which has a tangible user experience (plus the apps themselves are definitely a thing they built). Building a good marketplace is also no small feat.
In concept, they are all useful abstractions over the worst case scenario: individuals only finding and talking with other individuals to get goods or services. In practice, there are definitely abuses which come down to ineffective regulation.
Re: An Economy of Overfed Middlemen
#26Earlier quoted context omitted.
There's a large body of economic literature arguing that competition breeds efficiency and better service. Granted it's only starting to grapple with the question of how to regulate the new economy - c.f. Lina Khan's paper on Amazon which made quite an impression [1] So it's not clear that breaking up a digital marketplace monopoly would result in shittier products, tho I agree that the theory is less clear cut than…
This is one of those weird things where in principle , a monopoly should be both interested in providing the best possible service (to keep their position indefinitely, even through technology shifts), and in a unique position to invest in research to make it so (under competition, it's harder to invest in research.) In practise, that's not what happens.
That's not even true in principle. A monopoly's interest is in moatbuilding and maintaining their monopoly. If service and research achieve that, then fine, but if they don't that's also fine.
Re: An Economy of Overfed Middlemen
#27Earlier quoted context omitted.
If a monopolist is efficient, then nationalization is efficient. Break them up or seize them.
Not all monopolists are equally efficient at managing their monopolies. Especially monopolies that can bail themselves out by forcing people to subsidize their losses.
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Re: An Economy of Overfed Middlemen
#28Earlier quoted context omitted.
There's a large body of economic literature arguing that competition breeds efficiency and better service. Granted it's only starting to grapple with the question of how to regulate the new economy - c.f. Lina Khan's paper on Amazon which made quite an impression [1] So it's not clear that breaking up a digital marketplace monopoly would result in shittier products, tho I agree that the theory is less clear cut than…
This is one of those weird things where in principle , a monopoly should be both interested in providing the best possible service (to keep their position indefinitely, even through technology shifts), and in a unique position to invest in research to make it so (under competition, it's harder to invest in research.) In practise, that's not what happens.
Why would a monopoly be interested in providing the near possible service? They can simply lobby to make upstarts impossible, or buy them, or bleed them dry with localised dumping prices, or steal all of their best ideas given they have more resources. All of these have much higher margins.
It's not a "weird thing" it's the inherent reason why anti trust laws and regulations are required for efficient markets, and why rent seekers always argue for free markets
Re: An Economy of Overfed Middlemen
#29One thing we have to ask is the monopolization the problem?? Do we want to break monopoly up in favor of a bunch of possibly shittier products? The real problem It's not the monopoly it's the Monopoly tax.
It doesn't matter how good at what they do a particular company is; we still don't let them take over everything.
If we were to be organizing our economy based on what is maximally efficient, it would be much more effective to do so with the government in charge...but somehow, the people who talk about letting one efficient company take over everything never seem to think that letting the government do the same thing, but without taking massive profits, would be good.
Re: An Economy of Overfed Middlemen
#30Middlemen (e.g. wholesalers and retailers) serve a valuable function. Imagine each consumer having to maintain relationships with hundreds of factory owners and tens of farmers.
>Imagine each consumer having to maintain relationships with ... tens of farmers Farmers' markets are great.
>Farmers' markets are great.
Fyi if you didn't already know... the farmers' markets are themselves a type of middlemen. (At least every one I've shopped at in the USA.)
The farmers' market rents out the booth spaces to vendors (farmers). It's a real-world "platform" to bring together buyers and sellers. The farmers' cost to rent the space is embedded into the prices the consumers pay.
A true individual relationship with a farmer would be something like driving to Joel Salatin's Polyface Farms and buying broiler chickens directly from him. This bypasses the middlemen of farmers' markets.