Fridays seem to be tired days lately. A sign of working hard throughout the week?
|Time (PDT)||Intention||Revision 1||Revision 2|
|1100||SST Weekly Standup|
|1130||Walk to work|
|1530||Zendesk Connector||and distracted|
|1600||Zendesk Connector||and distracted|
|1630||Walk to library|
|1800||Walk to Livio's||and eat|
|1900||Hanging out||Neo Yokio|
|0100||Gaming: Overwatch||Walk home|
Basic Economics reading.
Here we go, "Monopolies and Cartels" in Chapter 7, "The Economics of Big Business". Will I eat my earlier words? I hope so.
Before that though, because I'm already writing, some random thoughts. I am really enjoying the book's example-based approach to things, in all honesty. It's pretty solid.
Though, there's a lot of assumption that people whose money are on the line are more likely to know the value of things. He mentions CEO compensation and golden parachutes, and says that these things are likely necessary mechanisms, but (again, I'll have to find and vet my sources here) to my knowledge, empirical studies show no good evidence that higher CEO pay leads to better results.
In fact, it often leads to worse results. Perhaps a weakness in the system that could be overcome with newcomers and the better data.
Anyways, back to reading.
He's blaming governments for monopolies. I guess that's technically accurate, but he's blaming not a lack of laws but the creation of laws that help monopolies exist. The latter is possible, mind you, but the former is also very possible. A free market is a vacuum, and businesses can create their own pseudo-governments quite easily. It's just asking for the creation of a plutocracy.
No mention of Rockerfeller in the section. The closest the book comes to admitting that privately created monopolies could require political intervention is: "In the absence of government prohibition against entry into particular industries, various clever schemes can be used privately to try to erect barriers to keep out competitors and protect monopoly profits. But other businesses have incentives to be just as clever at circumventing these barriers. Accordingly, the effectiveness of barriers to entry has varied from industry to industry and from one era to another in the same industry."
The book goes on to note computers as an example. When they were big and costly, not that much competition, but as innovations made them cheaper, competition seeped in.
Perhaps foundational costs are a weakness in a purely free-market economy, and alternative methods of initial ground-breaking research is warrented? That's my take, anyways.
That's the end of chapter 7, and the end of my reading for today. Tune in tomorrow for "Chapter 8: Regulation and Anti-Trust Laws". The title seems promising.
Friend running late, getting some extra reading in before heading over to his place.
There's a really good bit in this chapter already:
"The economic complexities involved when regulatory agencies set prices are compounded by political complexities. Regulatory agencies are often set up after some political crusaders have successfully launched investigations or publicity campaigns that convince the authorities to establish a permanent commission to oversee and control a monopoly or some group of firms few enough in number to be a threat to behave in collusion as if they were one monopoly. However, after a commission has been set up and its powers established, crusaders and the media tend to lose interest over the years an turn their attention to other things. Meanwhile, the firms being regulated continue to take a keen interest in activities of the commission and to lobby the government for favorable regulations and favorable appointments of individuals to these commisions.
"The net result of these asymmetrical outside interests on these agencies is that commissions set up to keep a given firm or industry within bounds, for the benefit of the consumers, often metamorphose into agencies seeking to protect the existing regulated firms from threats arising from new firms with new technology or new organizational methods. [...]"
The book goes on to give an example in the Interstate Commerce Commission. My mind, however, went to the FCC and the recent appointment of a leader completely uninterested in maintaining Net Neutrality.