Discussion and 2 replies

Perfect Competition is for Losers?

 Available on Wednesday, November 18, 2020 1:45 PM EST

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Dear ECON 203 (Rota u. Landstuhl+) Students:

Now that you have a sense of the economics of perfect competition, it’s appropriate to ask if this really is the way of the world.   And, if not, should something be done about?

To “begin your quest for truth,” read a piece authored by PayPal co-founder, Peter Thiel, which first appeared in the Wall Street Journal a number of yeas ago and has since become somewhat of a classic.  (Sometimes it’s worth looking backwards.)

http://www.csun.edu/~vcact00f/497CapStone/Peter%20Thiel_%20Competition%20Is%20for%20Losers%20-%20WSJ.pdf

So do you agree that “monopoly is the condition of every successful business”?  And, therefore, the keys to success of the U.S. economy?  Or is the increased purported monopolization of U.S. business strangling the U.S. economy?  (You might wish to skim the piece below.)

https://hbr.org/2018/03/is-lack-of-competition-strangling-the-u-s-economy)

Explain your view carefully.  Examples from the readings, of course, are always a good place to start.     Please note.  Your must  choose sides here; i.e., you’re not allowed to be on the fence.

Post by  Laquandria Hayward-Brown  

After reading the article, I believe that the increased purported monopolization of the U.S. business is strangling the U.S. economy.  I believe that the larger business take advantage and take away from all of he smaller businesses. Larger businesses like Amazon and Google know there isn't  really competition because they make is so convenient for everyone to use.  This is the big advantage that these bigger businesses have.  I'll admit that I do utilize most large businesses such as Amazon and Google, but I still feel like there should be enough for the underdog.  To help with this, I've been purchasing a lot from small business.  Although one person won't help the small businesses, but if it's marketed and advertised enough, their businesses will be a success. Monopoly is a main driver of inequality, as profits concentrate more wealth in the hands of the few.  The effects of monopoly enrage voters in their day-to-day lives, as they face the sky-high prices set by drug-companies and the abuses of cable providers, health insurers, and  airlines. Monopoly provides much of the funds the wealthy use to distort American politics. (Lynn, 2017). 

Reference

Lynn B. (2017, February 22). America’s Monopolies Are Holding Back the Economy. Retrieved from https://www.theatlantic.com/business/archive/2017/02/antimonopoly-big-business/514358/

Post by  Matthew Alindog  

So do you agree that “monopoly is the condition of every successful business”?  And, therefore, the keys to success of the U.S. economy?  Or is the increased purported monopolization of U.S. business strangling the U.S. economy?

I believe the increased purported monopolization of U.S. business is strangling the U.S. economy. I think this because monopolies such as Amazon, Walmart, Microsoft, Google, etc., take away attention and customers from smaller businesses. For example, shopping on Amazon instead of at an indie brand. This takes away business from the smaller company, which then allows the bigger company to expand their business even further because theres virtually no competition. This would also cause less profit in the smaller businesses or possibly make no money, and have the potential to be shut down. In today's world, these monopolies have gotten so big to the point where theres a huge divide between these larger corporationsand small businesses that are trying to get by. Also, with these monopolies gaining all this money, the smaller businesses are having a harder time to compete with them. This leads to a margin where the bigger businesses feed off of the smaller businesses vulnerability.