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China is now producing one wind turbine every hour: http://www.tutor2u.net/blog/in... (while we squabble about whether radiative physics is a real thing or just Greenpeace propaganda)

To be doubly clear labor also includes AI, Software and Robots.

No it doesn't.

http://www.tutor2u.net/economics/gcse/revision_notes/basics_factors_of_production.htm

http://www.businessdictionary.com/definition/labor.html

They're tools/machinery, i.e. they fall under capital.

The value of UK manufacturing increased since Thatcher was in power: http://tutor2u.net/economics/content/essentials/manufacturing_industry_in_uk_clip_image002_0000.gif

Well, I have seen plenty of lies with statistics. Not saying this is a lie, just that I cannot remember the last manufactured thing I bought that said "Made in the UK" - apart from a box of Xmas crackers. It is no longer possible to buy a sane british car (I don't count Jap assembly plants in the UK, because the clever designing is done elsewhere and those plants are just chimps banging things together). You do realise that stuff coming from abroad as a kit and assembled here is counted as made in the UK as far as the spin doctors are concerned?

I also know that whole areas of cities that were once factories have been flattened and replaced by housing and "retail outlets". Small anecdote - I want to get something cast in iron. Despite being in South Wales, once a centre of iron and steel making, I cannot find anywhere for it. Suggestion gratefully received.

The unions killed manufacturing (as it was then). Thatcher killed the unions. The value of UK manufacturing increased since Thatcher was in power: http://tutor2u.net/economics/content/essentials/manufacturing_industry_in_uk_clip_image002_0000.gif

Economies of scale only matter when two companies are competing on the same product.

Nah, the econcomies of scale still impact the supply curve because it reduces the cost to produce each unit. It's the margin that drives decisions, not the sales.

That said, the impact in a surge in demand is usually going to increase price, because it is actually moving the entire demand curve whilst just travelling along the pre-existing cost & supply curves. But, an increase in demand can result in a lower sales price when you have a cost curve shaped more like a wave (dramatic scale economies but only in intervals) or where the angle of the demand curve changes (demand becomes more price-elastic).

This often isn't covered in classes, since it's just a case of applying the taught principles to a new scenario, but does happen quite often in the real world. Probably a good example is where a niche high-end maker of clothing has his designs come into mainstream fashion. He may lose some high-end customers who appreciated exclusivity but gains heavily in the price-sensitive mainstream, so the demand curve pivots rather than shift to a higher parallel. This itself puts pressure that a new profit-maximising position is to reduce prices. But there is the secondary effect of serious scale economies kicking in from employing some massive factory instead of the wee bespoke outfitters used before. Because of this the new profit-maximising position may be dramatically lower prices to what it was before.

Another good example is often the supply of water to homes. The process is so incredibly capital-intensive that it is the norm for the monopoly's scale economies to be such that their profit-maximising position is actually a lower price point than under competition (of course there are way to still have competition but that's beside the point of the illustration).

http://tutor2u.net/economics/content/topics/monopoly/monopoly_profits.htm

I don't know how the above was modded Insightful.

The batteries are a variable cost, much like the steel to make the car, the tires on the car, the labor that is used to build each car, etc. The cost is associated with each car built. Constant costs are fixed costs. These would be the costs associated with the plant the cars are built in, the robotics used to build the cars, the building maintenance of the plant, etc.

Let's think of it another way: If the Chevy was to make 10,001 Volts, they would have to purchase 1 more battery pack to go in that extra car (technically, although it does run on gas only).

I think you are mistaking marginal costs and constant costs. Marginal costs are costs associated with making extra units or adding production. A great example is if Chevy took the same plant and decided to make 12,000 Volts. This likely means that they would have to pay overtime and/or add another shift to the plant. This is the additional marginal costs. Marginal costs are often associated with labor because there is only so much work a person can do before they have diminishing returns (get tired and do less work). That being said, goal of every profit driven company is to match its marginal costs with its marginal revenue (i.e. for the additional cost of adding one more unit equals the additional $ in profit of making that exact unit~). This is the point when a company has reached maximum profitability, after this it makes sense to add capacity usually via additional fixed costs, which creates a new average total cost, a new average variable cost, and a new average marginal costs. Marginal costs are hard to conceptualize because they exist in reality but we look at them abstractly and only exist for an exact set of parameters; most companies and people don't think along these lines, they think of adding production capacity, when we can't squeeze any more production out the existing facilities and labor.

Thanks for taking me back to college! It is nice to finally use my econ degree for something!

http://tutor2u.net/economics/revision-notes/a2-micro-supply-shortrun-costs.html

Are you serious? So everybody who buys coffee at Starbucks always gets a large then? This is called SECOND DEGREE PRICE DISCRIMINATION and works all the time.

I can't see how it will stop in 2010 regardless of who is in power, the only difference will be which asshat is in power. Obviously the political parties will offer us all something that we like the sound of and try to bury the unpopular policies. So a new government comes in or gets restored they then make some show of implementing or delaying implementing the popular policies that got them to power and at the same time doing things we distinctly dislike.

While you can argue that perhaps that it seems reasonable for a general election to be called on change of prime minister, its not backed up in practice

http://tutor2u.net/blog/index.php/politics/comments/unelected-prime-ministers-the-political-and-constitutional-importance/

"'When a party in government replaces its leader, there is no need for the new prime minister to call an early general election. Macmillan waited 2¾ years, and Callaghan three years until he was forced to hold one by a Commons vote of no confidence. Douglas Home waited a year, and John Major 15 months, but they were near the five-year limit before an election has to be called. Eden called an election almost immediately after taking office, but the parliament was more than 3½ years old. After succeeding the dying Bonar Law in May 1923, Baldwin went to the polls within six months on the issue of tariff reform, only a year into the Parliament, but lost - an unhappy precedent.' "

So its a bit of a mixed bag theres been a few unelected prime ministers from both sides. John Major was the last Conservative Prime minister to do so.
If Gordon Brown wasn't Prime Minister, it would probably still be Tony Blair but definitely not David Cameron till at least 2010.

If they have nothing to sell to their customers, then they won't make very much money, will they.

But that's not how things work when you're a monopoly. Or even a company with only eighty percent of the market. Your product doesn't have to be ideal, just good enough to keep competitors from spending the billions of dollars and years of coding to even try to catch up. Google is now so big that their energy usage alone affects the budgets of entire counties. Looks to me like you're assuming that somehow if they don't do the best possible job, competition will somehow magically take care of it. That it's a choice between "nothing to sell" as you put it, and putting out a flawless product. Well, first of all, there's a huge range between "nothing" and "best". Secondly, when the barriers to entry are measured in billions of dollars and tens of thousands of programmer years of work, it's not realistic to expect that somebody will somehow just step in and supercede Google if they do something wrong.

Now, maybe you're thinking as you read this about Yahoo, MSN, and so on. Well, have you ever used their search engines in the past five years? I run web sites so I have to. They suck. I'm not even going to bother to explain why Microsoft would f*ck up a programming job; anybody posting here should get that already. But if you look at the others, they're somewhere between bush league and simply not built as general purpose search engines. Ask Jeeves and Yahoo are built for ignorant, clueless lumps who want everything explained to them in small words. Search on anything there and you'll reliably end up at sites with a fifth grade vocabulary and lots of "for dummies" style handholding.

What's my point? That their engines aren't even built to do what Google's does. To say that they still compete head to head with Google is like saying that Cliff Notes is competing with Encyclopedia Britannica. This means that in some ways, Google is already a monopoly and I'm willing to bet that the programmers in those companies who study how each other's code works would agree with me. They offer, superficially, the same product, but not to the same markets and not for quite the same uses.

Make no mistake; I use Google,too. Their results are fantastic. But just as I avoid posting links to Wikipedia, I go out of my way to find things in other ways than Google. As the article points out, power corrupts, monopoly power especially. And whether the folks in Google still believe after their cooperation with the Chinese government and their retention of personal data and so on that they are free from "evil" to use their own term, they will become a problem, a censoring, privacy infringing, overcharging danger to, quite literally, the entire human race if they keep going the way that they're going now.

In a free market the economic profit should indeed tend toward 0% but the 7% you mention is accounting profit which doesn't include things like opportunity costs.

Also, "willing to pay" doesn't mean "the price you think is fair". It means "the price at which you stop buying". It would be better termed "willing to buy". But actually that doesn't matter since a true free market actually charges less than some people's "willing to pay" price and more than other people's "willing to pay" price because some people are willing to pay more than others even though the price the item is sold at is (usually) the same for everyone. (Exceptions include coupons, student discounts and a whole host of tricks known as price descrimination.)

ECON 101, possibly the most important course anyone who wants to have an informed political opinion could take.

More like:

http://www.tutor2u.net/economics/content/topics/mo nopoly/natural_monopoly.htm
http://www.progress.org/fold74.htm
http://en.wikipedia.org/wiki/Natural_monopoly

I'm not saying that that stuff doesn't happen, but the very nature of the industry leads to oligopoly. And, no, I do not work for any company remotely related to telecom.

I'm such a big believer in free market economics...

See
http://www.tutor2u.net/economics/content/topics/mo nopoly/monopoly_profits.htm
For a nice explanation of monopolies. You can also look up oligopolies.

The sad news is there is no such thing as a perpetually competitive market. The tendency is for one firm to use any means necessary to maintain a dominant position. Therefore, there is no "upstart" no small company out gunning the big behemoth. Small company too big? Crush them. Period. Example, phone companies, Microsoft, etc.

It has been observed in history that capitalism tends to create two social classes, one very small minority dominating the other in every sense of the word. Some societies have made laws that supress these tendencies and redistributes wealth. But labor and environmental laws, sewers, building codes all are the antithesis of capitalism. They do nothing but raise the cost of goods and services.

Please do not resort to quickie-mart capitalism. I urge you to get a better grasp of *both* sides of the subject.

Oh, come on.

If you strip away enough you can get to the fact that every movie has one of two plots:

Introduce hero, Kill hero (or hero's dreams)
or
Introduce hero, hero succeeds.

It's a matter of how deep you want to go. Every movie made now can certianly be compared to a movie made in the 70s. Or 60s. Or 80s. Etc.

Complete lack of imagination? Describe an artist, writer, composer, or book that would not only fullfill all your criteria for imaginative (ie, completely new idea, concept, etc) AND would have enough mainstream appeal to pay for its own production and distribution.

All the interesting stories are exactly the same as the old interesting stories. People's basic needs haven't changed (food, security, love, recognition, etc), and therefore the basic movie fair isn't (arguably can't) going to change.

The reason the movie industry is declining is not so much due to the fact that there really are no new stories. It's due to the fact that there are so many other equivilant forms of entertainment available, and many are cheaper and more convenient.

-Adam

long term unemployment

I assume you mean long-term unemployment compensation.

The first thing I will do is stop working, and if you feel like working for your money when I can get it for free due to your "long term unempoyment" idea, well... go right ahead.

Matter of fact, I might just become unemployable over the long term. Enjoy taking care of me. Provide my food and shelter, and work your ass off so that I can get it for free.

Do I get free broadband along with it?

Enjoy your life of hard work while I malinger my way through life at your expense.

Did you ever think that the more "progressive" Europe has a higher unemployment rate than the United States because some people choose to be unemployed?

Europe's best employment rate over the past decade has never been as good as the United States' worst. Do you think maybe that incentive to work has something to do with that?

Generally the unemployment rate of a country is a good indicator of economic stability. The US has a much lower unemployment rate when compared to Western Europe.

http://www.tutor2u.net/economics/content/topics/eu rope/unemployment_introduction.htm

Of course one could argue that there is more opportunity in the US to find a job. What causes these job opportunities? Policy.

The tax rate in the US is the lowest of any developed nation. While some coutries have higher taxes and universal healthcare, the US has lower taxes allowing individuals to buy more goods. The consumer buying the goods allows the seller/producer to expand their business and hire employees. This fundamental difference allows unemployment in the US to be lower than Western Europe.

I'm sorry -- you don't recall correctly. Monopolies are bad for consumers. For an ECON 101 refresher, see here.

Monopolies charge more for goods than competition would allow. There are certain types of markets where a monopoly is likely. This is generally due to high cost to enter a market and low marginal costs (sounds like a software market). However, just because it's likely doesn't mean it's good.

I may have jumped the gun with the 25% figure. In the UK, a working monopoly is defined as a firm that holds greater than 25% of the market share.

Theoretically, a firm that holds a monopoly on a market holds all of the market share.

Legally, a firm that has 25% or greater market share is said to be a monopoly. This is called a working monopoly.

So yes, legally, 2 or even 3 firms can have a monopoly in the same market.

On Topic, programmers are getting beat to death like the auto workers and steel workers in the 80's. By dimantling the middle class one industry sector at a time, the rest of the middle class ignores it. Unfo. for the elitists there's a snapback effect once a critical mass is reached. Perhaps they think by extending the process over 50 years the effect will not occur? I theorized while studying Western Cic. in HS that about 18% of the people have to get really pissed and then they start protests and then the snapback snowballs. When you see people actively attacking the elitist governemnt, then you are seeing that people are pissed.
National Debt (well, basically embezzlement by the politicians and their cronies) is just one reason. Take a look at the last page of this link and see pure embezzlement from our government: embezzlement?. Who's stupid enough to vote for an incumbant? Bush and Kerry are both incumbants. They should both tear their clothes, gnash their teeth, and ask the American people to pray for a better government. They don't.
I was looking at the debt before and got some numbers from various US gov. web sites. Amazingly the dis-information campaign has not shut these down. Funny thing is that it has increased ever since like 1962 but Democrats claim Clinton had a Balanced Budget. This FALSE accounting is nonsense. Ask a kid in school if spending more than you take in is a Balanced Budget. That said, the administration prior to this one did do alot better. The USA cannot afford another Republican government if you believe that relates to the debt trendline. We will be bankrupted and forced into servitude to a world government/bank. "Don't cry for me Argentina...." :-)
First look at the situation for UK and Canada. UK
Canada
These can be graphed in Excel... I did not find a good site with the chart on the web.
,Budget Surplus or Deficit (-) as % GDP,Cyclical Surplus or Deficit (-) as % GDP,Other Adjustments as % GDP,Surplus or Deficit (-) as % GDP,Revenues as % GDP,Outlays as % GDP,Debt (100B),Debt as % of GDP,Debt as % of Tax Income (x100),GDP (100T),Debt,Tax Income (100B),Tax Income (B),Tax Income as % of GDP (x100) 1962,-1.2,-0.4,0.1,-0.7,17.3,18,,,,,,0.5,46.5, 1963,-0.8,-0.3,-0.1,-0.6,17.5,18.1,,,,,,0.5,49.1, 1964,-0.9,0.3,0.2,-1,17,18,,,,,,0.5,46, 1965,-0.2,0.8,0.2,-0.8,16.2,17,,,,,,0.5,51.1, 1966,-0.5,1.9,0.4,-2.1,15.9,18,,,,,,0.6,58.6, 1967,-1.1,1.7,*,-2.8,16.9,19.7,,,,,,0.6,64.4, 1968,-3,1.4,0.6,-3.7,16.5,20.3,4,,4.7%,, $358.00 ,0.8,76.4, 1969,0.4,1.6,*,-1.2,17.7,18.9,4,,4.0%,, $368.00 ,0.9,91.7, 1970,-0.3,0.6,0.2,-0.6,17.8,18.4,4,,4.4%,, $389.00 ,0.9,88.9, 1971,-2.1,-0.3,0.9,-0.9,17.1,18.1,4,,4.9%,, $424.00 ,0.9,85.8, 1972,-2,*,0.3,-1.7,16.9,18.6,4,,4.2%,, $429.00 ,1.0,102.8, 1973,-1.2,1.2,0.6,-1.7,16.7,18.4,5,,4.3%,, $469.00 ,1.1,109.6, 1974,-0.4,0.7,1.3,0.1,17.7,17.6,5,0.3%,3.9%,1.5, $492.00 ,1.3,126.5,8.4% 1975,-3.3,-1.4,2,0.1,18.5,18.4,6,0.4%,4.8%,1.6, $576.00 ,1.2,120.7,7.5% 1976,-4.1,-1.4,0.8,-2,17.3,19.3,7,0.4%,4.6%,1.8, $653.00 ,1.4,141.2,7.8% 1977,-2.7,-0.6,1,-1.1,17.8,18.9,7,0.4%,4.4%,2, $718.00 ,1.6,162.2,8.1% 1978,-2.7,0.1,1.3,-1.5,17.5,19.1,8,0.3%,4.2%,2.3, $789.00 ,1.9,188.9,8.2% 1979,-1.6,0.5,1.4,-0.7,17.9,18.6,8,0.3%,3.8%,2.6, $845.00 ,2.2,224.6,8.6% 1980,-2.7,-0.7,1.6,-0.4,18.8,19.2,9,0.3%,3.7%,2.8, $930.00 ,2.5,250,8.9% 1981,-2.5,-0.9,1.2,-0.4,19.5,19.9,10,0.3%,3.5%,3.1 ," $1,028.00 ",2.9,290.6,9.4% 1982,-3.7,-2,0.7,-1.1,19.2,20.3,12,0.4%,4.1%,3.3," $1,197.00 "

I'd say it stinks of oligopolistic behavior, but that's a lot of syllables.

It's part of this amazing thing called a free market

I can understand what you're saying, but this is not a free market, in the pure sense of the term. In a free market, anyone would be able to distribute any particular piece of music that they wanted for whatever price they wanted. Likewise, anyone else would be able to buy from any supplier who has the right price. Copyrights are a government intervention in this process which gives a particular entity sole distribution rights, in effect a monopoly.