From: Brian D Williams (talon57@well.com)
Date: Thu Aug 30 2001 - 08:39:14 MDT
>From: "Dickey, Michael F" <michael_f_dickey@groton.pfizer.com>
>>"You claim tire installers are making 50K? how about some proof,
>>and by the way if it wasn't worth it the company wouldn't pay
>>it...."
>They dont, instead they close up shop and move south, where the
>same job can be performed just as well in a cheaper environment.
>Then, of course, everyone complains that these greedy corporations
>are stealing jobs from the US and giving them to mexico, of course
>these same people turn around and buy cheap imported clothed,
>electronics goods, and cars. Very few of them are willing to pay
>the extra money for a product required to pay the average american
>worker.
Well, there are still some cars made here.
I still make a very concentrated effort to buy American simply
because It's important to me that my fellow citizens are gainfully
employed.
>"Either a monopoly or a monopsony can control the price of either
>goods or labor."
>only to a limited extent, see my previous objections to monopolies
>and price fixing.
I am refering to a perfect monopoly. (theoretical)
>But those things never last. Even when price fixing, say four
>companies get together and agree to charge $5 for thier product,
>which cost $1 to manufacture and distribute, they now share the
>market equally. It will always be in one of the companies best
>interest to undercutt the others. If those four companies each
>shared 25% of the market then it would be in one of the companies
>best interest to now charge $4 for thier product since they
>may take a far greater percentage of the market. If the market is
>not equally shared by all companies, then it is not in the
>companies that are not recieving an equal share's best interest to
>continue with that agreement. Also, other companies who might not
>be making a competing product would then decide to since they
>could undercutt all the price fixing competitors and take the
>whole market. In this way price fixing never lasts, and it can
>never go past a certain point in price anway. If all the
>companies who sell milk decided to charge $4 a gallon, would you
>still drink it? $8? $32? There is always a limit that anyone
>will pay for a product, even in a monopoly the price is kept in
>check.
Excuse me but your examplr describes a cartel, not a monopoly.
>>Lets try a modern day example. Suppose Microsoft was the only
>>software company in the world. Do you think anyone would be getting
>>stock options and bonuses or relocation allowances, or would
>>programmers be working for minimum wage."
>Do you think those people would continue working for microsoft?
>Or would they quit and start thier own software company? Do you
>think that other companies wouldnt then decide to enter the
>software market given the potential profit margins?
For the point of discussion I was asking for the assumption that
there was only one company. My points are valid within that
assumption. I know this isn't a real world scenario, it was a
simplification.
>Pointing out why free markets wont work by imagining a world where
>only one producer is allowed isnt valid, as no such world would
>exist.
I wasn't attempting any such thing, I was demonstrating the control
possible under a monopoly.
Brian
Member:
Extropy Institute, www.extropy.org
National Rifle Association, www.nra.org, 1.800.672.3888
SBC/Ameritech Data Center Chicago, IL, Local 134 I.B.E.W
Disclosure notice: currently "plonked"
"Joe Dees" <joedees@addall.com>
"Party of Citizens"<citizens@vcn.bc.ca>
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