This Blog Has Moved!

My blog has moved. Check out my new blog at realfreemarket.org.



Your Ad Here

Tuesday, October 2, 2007

Oligopolies Exploit People More Efficiently than Monopolies

Why not have a monopoly in every single industry? Why are oligiopolies better?

First, a monopoly is obviously inefficient, even to brainwashed economists. An oligopoly provides the illusion of free trade. An oligopoly provides the illusion of customer choice. An oligopoly provides the illusion of competition, without any of the productivity gains of free trade.

In an industry controlled by a monopoly, the monopolist charges its production costs plus whatever profit rate it desires. There is practically no incentive for the monopolist to reduce its costs. A monopoly is great for exploiting customers. However, a monopoly has no incentive to exploit its workers. After all, higher salaries can just be passed on as higher prices.

An oligiopoly gets the best of both worlds. Customers are still exploited by cartel pricing. Workers are exploited as well. Salaries must be kept low, under the pretense of competition from other cartel members. Occasionally, one cartel member goes bankrupt or is bought out by another cartel member. That helps keep up the illusion of free trade.

Most industries have oligopolies instead of monopolies. A monopoly exploits customers, but not its own employees. An oligopoly can exploit customers and its employees at the same time. Oligopolies are the most efficient mechanism for enslaving people and lowering their standard of living.

No comments:

This Blog Has Moved!

My blog has moved. Check out my new blog at realfreemarket.org.