Quote:
Originally Posted by luqmaninbmore
Ah, yes, the invisible hand at work. How's that working out for your pension?
|
Not bad, thanks for asking. It's probably doing better than, oh, those Greek state-run pensions. Just a guess.
(I actually don't believe in many of the concepts attributed to the Invisible Hand, by the way, but I do think companies have the right to make profits.)
Quote:
|
Originally Posted by luqmainbmore
If people who hold a monopoly are able to use it to successfully extort a higher price, it's justified?
|
I'd put it more like this:
When dealing physical goods, retailers are essentially buying a huge lot on spec, holding them in inventory, and are responsible for fulfillment. These costs, while not huge and somewhat mitigated by returns, do create risks for the retailer which in turn justify control over pricing.
With digital goods, not so much. No one is complaining about the App Store allowing software publishers to set their own prices, and let's face it, you've got to be pretty extreme to slam Smashwords or Amazon's DTP for giving authors/publishers full control over prices. Publishers also ought to get enough pricing information to indicate "hey, we should try cutting the price a little bit."
Nor are monopolies inherently evil. The problem arises when they engage in anticompetitive behavior. Even then, some people find ways to justify it; for example, many utilities in the US are given local monopolies. Also in the US, Amazon's share of the (paper) book market is extremely high, nearly 70%. One man's monopolist is another man's downtrodden hero, I guess...