You cannot study a systemwithout taking it out of the context of the real world and breaking it down piece by piece. That is why you couldn't pass economics...you have to look at isolated cases and isolate them further to look at each market force separately. Otherwise you get too bogged down in specifics and externalities, much like this discussion. Eventually you come to realize that the real world doesn't match the theory, because there is a little thing we are assuming...that phrase is "all other things equal." Obviously that's not true in the real world.
I should have been more clear...by "Most are a combination of public as well as private goods" I meant that there are very few goods that do not have qualities of both private goods and public goods.
I believe that some early lighthouses were actually privately run.
You are missing the point. The light from the lighthouse is the public good. When you are out on the sea in the middle of the night, that light is helping you whether you use the nearby dock or not.
You are creating an arbitrary category called a "pure competition"
No I'm not. That is the first type of capitalist market structure studied in most microecon classes. If it's not in your book, then something is wrong with your book. An example of pure competition is the argiculture industry. Not much point in discussing that further; I'm sure you have many reasons why agriculture is not pure. And yes, I know all about subsidies and factory farms blah blah blah. I'm trying to discuss simple theories here and you are bringing too much into it.
Clearly there are no true real world examples of any of these types of markets. They are devices for studying and describing economics. Obviously the real world is much more complex. These "wrong" assumptions have to be made in order to study the system. There's just no way around it.
Basically what you've done here is taken my noble attempt to clear up a mistaken point by offering a little lesson and turned it into a circus. Your theories are clearly not popularly accepted, or they'd be taught instead. And don't bother getting into that whole "against the status quo" thing, it's sad, really.
Drinking water is (essentially) a public good and is generally provided by the local government.
I can't say that it's *always* provided by the local government (although I assume it is), but here we're talking about a public utility provided by a government-run organization. Public utilities are natural monopolies.
I'm kind of stumped on the cable issue. Seems like it's not a very good example of a public utility, since it's not a necessity, but it is a good example of a natural monopoly. Decreasing cost is really what creates a natural monopoly, not whether it's a necessity or a public good.
I do have a limited understanding of cable companies. However, the basic point I was trying to make is that natural monopolies do exist, and a clearly incorrect post got modded up. That incorrect post will just go to further the economic ignorance of the majority of/. readers.
Has anyone else noticed this? Not one single thing has been done punishing Microsoft for their actions.
Not to mention the security API. There is nothing keeping them from writing one big lump of.dll that includes OS security and the copy/paste function all in one. Then of course there is the absence of provisions for OEMs to sell computers sans Windows.
I was wrong above...where I said, "in most cases marginal costs decrease...and marginal cost begins to increase again," I should have used "average total cost" instead of "magrinal cost." In fact a natural monopoly is based on the idea of decreasing average total cost and has nothing to do with marginal cost (save the fact that marginal cost and average total cost are related).
Looking at your comment history tells me that you are either a troll or have a habit of posting when you know nothing about the subject.
The whole point of this discussion is that it is sometimes in the public interest for a monopoly to exist. Clearly we are far off-topic, but I'm going ahead anyway. Such a monopoly is called a "natural monopoly," meaning the natural form for that market is a monopoly.
In a pure competition, the firms do not have enough control over the market (they actually have no control) to set the price. They are price-takers and not price-makers. They see one price for their good or service and their only variable is cost. The more goods they provide, the higher their revenue.
In a monopoly, the firm has complete control over price. The firm is the market. This firm sees the entire demand curve, not just the equilibrium point (the price at which buyers are willing to buy and sellers are willing to sell) as the firms in a pure competition do. This complete control over price means that the firm in a monopoly is free to set the price at whatever it chooses. Bring able to set that price means that the firm can earn a pure profit (pure profit is defined as the profit over and above the break-even point; note that breaking even actually means covering all costs including wages). That price (and by definition, the supply of good/service in the market) is set such that the firm maximizes its revenue.
This means that people who want the good/service are going to have to pay for it. Unfortunately, this means that some people will not be able to afford the good. Not all resources are used, since some of the good/service is held off the market in order to maximize the firm's revenue. This is the economic definition of inefficiency. This is not necessarily a bad thing, but it does encourage the firm to stop innovating and produce only what is necessary to maximize that revenue. Most would agree that lack of innovation is a bad thing, however. This is why, in most cases, government discourages monopolies.
The above paragraph is easier to understand graphically, so I will try to explain that graph. At the point where the marginal cost for a good (the extra cost for the next unit of a good) is equal to the marginal revenue earned from the sale of that good (which in the case of a monopoly is the same as the demand for the good), the firm is maximizing its resources. Move up the graph to the average revenue curve and you see that the average revenue at the MR=MC point is higher than the average total cost. This leads to pur profit. However, the monopolist can move that price back up the marginal revenue curve (which is equal to demand, remember) and finds that he makes even *more* profit by holding goods off the market.
Now let's look at the situation where the good/service is what is called a public good. A public good is a good/service that benefits everyone. Once produced it cannot be taken back. An example of this is a lighthouse. The lighthouse benefits the oil tanker just as much as it benefits the small fishing boat. The light from the lighthouse cannot be taken back. You also cannot charge the fisherman a different price to use the lighthouse than you charge the oil tanker captain. That light is out there for both to use, and can't be shut off if the fisherman doesn't pay.
In reality, there are very few purely public goods. Most are a combination of public as well as private goods. An example of this is electricity. It benefits everyone. It is in the public interest to have electricity. However, it is not in the public's interest for a monopoly to exist on the electricity supply. Or is it? Clearly we don't want the electric company to hold back its supply of electricity and only give it to those who can afford it. Everyone needs to have electricity.
Once company A lays wire and has covered the cost (no need to get into a discussion of amortization or depreciation here please) of that wire, it has dramatically lower costs than company b, which has to either lay its own wire or lease the wire from company a. Once the cost curve has dropped below the demand curve (as it does for a public utility), the monopolist no longer has an incentive to hold goods off the market. The maximum profit can be made where the marginal cost = marginal revenue. So in this case the monopoly is no longer a bad thing. Sure, the company can still charge whatever price it wants, but that is where regulation comes into play.
I'm sure this has been exteremly boring. Seriously, do yourself a favor and pick up a book on economics. It will enlighten you to a great many things about the way the world works.
You don't make sense. But that is neither here nor there. Somehow you got modded up to +5, which shows that/. readers tend to be misinformed. Someone will repeat what you have said in this forum, and it is incorrect. I am trying to correct this so there might be a better understanding of economics on/., something that is sorely lacking around here.
Natural monopolies *do* exist, but essentially only in cases where the good/service provided is a public good or a necessity. Cell phones are considered a luxury and certainly don't fall into either of the two aforementioned categories.
Just because a company is established doesn't give it an advantage. Having a good reputation might, and better advertising might, along with other variables, but being established does not in and of itself give an advantage, and certainly not a monopolistic advantage at that. You are trying to apply arguments for one market configuration to a different market configuration. A corner store is likely part of a pure competition. An automobile manufacturer is part of an oligopoly. So is a cell phone provider. Neither are monopoly markets and neither works the same. You are comparing apples and oranges.
Your arguments are so jumbled and incorrect I don't even know where to begin. Please, open and READ an economics text before you try to comment on it. If you *had* read an econ book, you would know that by "inefficient" I mean economically and socially inefficient.
Yes, but a government enforced monopoly is when the government prevents would be competitors from even considering the idea.
Name a government enforced monopoly. Come on, show me one. Just one. No, I won't wait for it. The only type of monopoly enforced by the government is the age-old bane of/.: the patent. And that's not even enforced as a monopoly: patents can be licensed. Name another, I dare you.
Why don't you let the potential competitors decide what's wasteful and what's not.
Guess what? THAT IS HOW A NATURAL MONOPOLY FORMS. It's called barrier of entry.
The additional start up costs of laying telecommunications wire does limit competition in these industries, but it doesn't eliminate it.
The startup costs are the barrier. Once those wires have been paid for by one company, their cost curve drops drastically.
I suspect that also means two sets of cables.
Have a look at your cable and phone jacks, the ones that are connected directly to the poles or the underground network. How many do you have? Is there one labelled "AT&T" and one labelled "RCN?" I didn't think so. You can bet that one company (or government, even) owns those cables and the other is paying for their traffic to run on them.
BS indeed. Read an economics textbook and see just how misguided most of the bullshit on this website really is. A monopoly is not always bad, no matter what common sense or public opinion tells you. Here's one that will blow your mind: It actually makes *more* sense for the government to tax necessities rather than luxuries. Another one: A flat tax actually costs poor people more than rich people.
I anxiously await your misguided and likely incorrect response.
Theoretically, a "natural monopoly" was supposed to occur when a business experiences reduced marginal costs with increased production. Normally, when production increases, marginal costs increase.
Wrong. Marginal costs do not always increase as production increases. In fact, in most cases marginal costs decrease as production increases. Up to a point, anyway, and marginal cost begins to increase again.
This, supposedly, creates a situation that would allow the company to defeat all of its competitors.
The point here is that there are no competitors. That is the definition of a monopoly.
For example, once the electric company has run a wire to your neighbor's house, then it's cheaper for them to run a wire to your house than it is for a competitior to do so.
No, it just doesn't make good economic sense for a competitor to run a cable to your house. Not much point in having two sets of electric wires, is there? That's a waste of resources and that translates to inefficiency.
You have to compare a monopoly with pure competition in order to discover the concept of a natural monopoly. If the costs incurred by suppliers in a competition are equal to the cost incurred by a monopolist, then a pure competitive market is more desirable because marginal cost = marginal revenue. For a monopolist, price = marginal revenue and there is inefficienct use of resources.
If there are ten companies each running wire to your house, the total cost for that is much higher than is one company ran wire to your house. This means that the marginal cost curve for a monopoly is much lower than that for a purely competitive market. It is this lowered cost curve that leads to a natural monopoly, that is to say a market that is more efficiently served by a monopoly than by competition.
What are your credentials, anyway? You say "simplistic arguments that might fool a freshman economics student (and most Ivy League professors)," as though you have a PhD in Economics. Sounds to me like you didn't finish the chapter on monopolies.
How is it that a sophomoric comment like "wow I can sleep at night" gets modded to '5 Funny' but the reply which was much more clever is left at 0? I bet you people think the movie "The Sweetest Thing" was funny too. Geez.
Yeah, the geek equivalent of omerta. Heheheh. There is no honor among software crackers. They are all little weasels that would rat out their friends in a microsecond if it meant the difference between getting Bubba-ed or continuing to live in their Moms' basements.
This guy is guilty. He's not an expert on anything but cracking and distributing software. Do we really need to interview him? I mean, what are we to gain from this?
And what exactly is that FTL communication method? We haven't quite mastered control of gravity yet. If concentration of matter or energy is required for these instantaneous gravitational changes, then we're required to break some thermodynamic laws to communicate FTL.
Actually it was Einstein's theories that postulated gravity as a distortion of spacetime.
Speaking of that...if gravity is a warping of spacetime, how is it that a body is ripped apart as it enters the event horizon of a black hole? Any of my physics professors that described black holes always said that a body would be ripped apart by the difference in gravitational forces as approaching a black hole. If gravity is a warping of spacetime, wouldn't mass in the warped space be warped as well, and therefore maintain its structural integrity?
I must be missing part of the picture here...I do actually have a bachelor's in physics, but this is something that I've wondered about for a long time.
When a respected magazine like Audiophile or at least Sound and Vision does a test like this, I will believe the results. Until then I will continue to listen to my compact-disc-sound-quality compact discs.
Allow your audience to tape and trade your concerts freely.
The Grateful Dead did it. Phish does it. Dave Matthews Band does it. U2 does it. Radiohead does it. Metallica did it. Note that I just named six of the top grossing concert acts ever. Combine that with a heavy touring schedule, and assuming your band is decent enough to draw an audience, they will rake in the dough.
However, if your band expects to make their primary income from record sales, you're gonna have to bend to the will of the record companies. Fact of the business.
Is the crap on tv that important to you people that you must record every second of it and save it for posterity? I'm sure that your life will go on if you miss an episode of Friends.
I mean, I like the show too, quite a bit actually, but if I miss an episode, I'm not going to spend much time worrying about being lost in the storyline. And if Coke decides to spend a little money to have one of their cans in the show rather than a Pepsi can, I'm not going to off myself in the name of anti-corporatism. Perhaps we could all focus our efforts and concern on something that matters a little more in the long run.
Ignore this issue and it will die the death it deserves. DRM on your PC won't happen anytime soon. If you want proof, look at Circuit City's failed DiVX format. The market sets the price, and the market has already said that it won't pay for something again that it already owns.
Re:GNU'S NOT ABOUT FREE SPEECH. IT'S ABOUT GAY SEX
on
Want Freedom?
·
· Score: 2
Can someone tell me why a moderator wasted a point on something everyone would ignore anyway? Can someone tell me why I'm wasting 1 minute of my life typing this?
Re:Americans throw away freedom for capitalism
on
Want Freedom?
·
· Score: 2
Spoken like someone who knows absolutely nothing about economics. I won't profess to be an economic scholar, but you (and most other slashdot readers) have a skewed view of capitalism.
There are four things called "economic resources." They are land, labor, capital, and enterprise. Combined with technology (not technically an economic resource) they add up to output. Each resource is finite.
Capitalism, just as its name implies, holds that capital is the most important of these resources. Socialism, as professed by Marx, implies that labor is the most important. So important, in fact, that socialists consider that labor is the only economic resource. The political ideology of communism rests squarely on the tenets of socialism. Based on the fall of the Soviet Union, I think you can see that socialism was at least partially incorrect.
Back to capitalism. Capitalism is NOT a type of economic system. It is merely a philosophy that says capital is the most important of the economic resources. The definition of capital, by the way, is not money. Capital is anything you use to produce a product or service.
The computer I'm typing on is capital. The car I drive to work every day is capital. The websites I visit in search of programming help are capital. Given this definition, you can see why capital is important to the economic problem. No car? Can't get to work. No computer? I'll have to find another job.
Capitalism != greed. Each of us has specific material wants and needs, and those are infinite. If you think your material wants and needs are not infinite, you'd better think again. You put limits on yourself based on your economic situation, but if you can have it, you will take it. If you could afford a nicer home, you'd have it. If you could eat filet mignon every night, you would.
I would bet money that you don't live in a cardboard box. You probably do not donate all your income to charity. You probably drive a car. If not a car, at least a very nice bicycle. You can have and do these things because you are free to do so based on the Bill of Rights and they improve the quality of your life. If they didn't, would you need/want them? I think not.
Capitalism is a by-product of our constitutional freedom. It cannot erode our freedom for that very reason.
It's time slashdot readers grew up and started taking a more realistic view of the world and get over this fantasy that everything should be free (as in beer). Life does not work that way.
Let's see some intelligent debate. I'm sure I'm somewhat inaccurate on some of these points, as I've only actually had 4 Econ classes.
Ah, but if you look at titles from 1999 or 2000, your comparison between DVD vs. VHS is also flawed. We are looking at market penetration *today*, not in 1999. More people own DVD players today than 3 years ago. The point of the article is that DVD is becoming as ubiquitous as VHS. Sure, Worst Buy and Circuit Shitty are pushing DVD over VHS, but that's because DVD makes them more money. Not to mention that those who own DVD players are more likely to purchase movies than those who own VCRs only.
So the comparison is fair. Movie sales are increasingly DVD-based, and that is the point.
Wrong. See the link in my.sig and you will learn why. I have approximaely 1500 audio discs that I downloaded from etree. These discs all started off as.shn (shorten) files transferred from DAT. Can you imagine the storage problem I have?
One concert takes up just a little over a gig, or two CDs of data and three discs of audio. A 50 gig removable disc would allow me to store an entire Phish tour in 16 bit 44.1 kHz CD quality audio on ONE SINGLE DISC. I can't wait.
Slashdot Mirror
You cannot study a systemwithout taking it out of the context of the real world and breaking it down piece by piece. That is why you couldn't pass economics...you have to look at isolated cases and isolate them further to look at each market force separately. Otherwise you get too bogged down in specifics and externalities, much like this discussion. Eventually you come to realize that the real world doesn't match the theory, because there is a little thing we are assuming...that phrase is "all other things equal." Obviously that's not true in the real world.
/. discussion. Dammit.
I should have been more clear...by "Most are a combination of public as well as private goods" I meant that there are very few goods that do not have qualities of both private goods and public goods.
I believe that some early lighthouses were actually privately run.
You are missing the point. The light from the lighthouse is the public good. When you are out on the sea in the middle of the night, that light is helping you whether you use the nearby dock or not.
You are creating an arbitrary category called a "pure competition"
No I'm not. That is the first type of capitalist market structure studied in most microecon classes. If it's not in your book, then something is wrong with your book. An example of pure competition is the argiculture industry. Not much point in discussing that further; I'm sure you have many reasons why agriculture is not pure. And yes, I know all about subsidies and factory farms blah blah blah. I'm trying to discuss simple theories here and you are bringing too much into it.
Clearly there are no true real world examples of any of these types of markets. They are devices for studying and describing economics. Obviously the real world is much more complex. These "wrong" assumptions have to be made in order to study the system. There's just no way around it.
Basically what you've done here is taken my noble attempt to clear up a mistaken point by offering a little lesson and turned it into a circus. Your theories are clearly not popularly accepted, or they'd be taught instead. And don't bother getting into that whole "against the status quo" thing, it's sad, really.
This has become a typical
Drinking water is (essentially) a public good and is generally provided by the local government.
I can't say that it's *always* provided by the local government (although I assume it is), but here we're talking about a public utility provided by a government-run organization. Public utilities are natural monopolies.
I'm kind of stumped on the cable issue. Seems like it's not a very good example of a public utility, since it's not a necessity, but it is a good example of a natural monopoly. Decreasing cost is really what creates a natural monopoly, not whether it's a necessity or a public good.
Shit, I misspoke.
/. readers.
I do have a limited understanding of cable companies. However, the basic point I was trying to make is that natural monopolies do exist, and a clearly incorrect post got modded up. That incorrect post will just go to further the economic ignorance of the majority of
Thanks for correcting me.
Has anyone else noticed this? Not one single thing has been done punishing Microsoft for their actions.
.dll that includes OS security and the copy/paste function all in one. Then of course there is the absence of provisions for OEMs to sell computers sans Windows.
Not to mention the security API. There is nothing keeping them from writing one big lump of
What a waste of taxpayers' money.
I was wrong above...where I said, "in most cases marginal costs decrease...and marginal cost begins to increase again," I should have used "average total cost" instead of "magrinal cost." In fact a natural monopoly is based on the idea of decreasing average total cost and has nothing to do with marginal cost (save the fact that marginal cost and average total cost are related).
Submitted this all wrong before. Trying again.
Looking at your comment history tells me that you are either a troll or have a habit of posting when you know nothing about the subject.
The whole point of this discussion is that it is sometimes in the public interest for a monopoly to exist. Clearly we are far off-topic, but I'm going ahead anyway. Such a monopoly is called a "natural monopoly," meaning the natural form for that market is a monopoly.
In a pure competition, the firms do not have enough control over the market (they actually have no control) to set the price. They are price-takers and not price-makers. They see one price for their good or service and their only variable is cost. The more goods they provide, the higher their revenue.
In a monopoly, the firm has complete control over price. The firm is the market. This firm sees the entire demand curve, not just the equilibrium point (the price at which buyers are willing to buy and sellers are willing to sell) as the firms in a pure competition do. This complete control over price means that the firm in a monopoly is free to set the price at whatever it chooses. Bring able to set that price means that the firm can earn a pure profit (pure profit is defined as the profit over and above the break-even point; note that breaking even actually means covering all costs including wages). That price (and by definition, the supply of good/service in the market) is set such that the firm maximizes its revenue.
This means that people who want the good/service are going to have to pay for it. Unfortunately, this means that some people will not be able to afford the good. Not all resources are used, since some of the good/service is held off the market in order to maximize the firm's revenue. This is the economic definition of inefficiency. This is not necessarily a bad thing, but it does encourage the firm to stop innovating and produce only what is necessary to maximize that revenue. Most would agree that lack of innovation is a bad thing, however. This is why, in most cases, government discourages monopolies.
The above paragraph is easier to understand graphically, so I will try to explain that graph. At the point where the marginal cost for a good (the extra cost for the next unit of a good) is equal to the marginal revenue earned from the sale of that good (which in the case of a monopoly is the same as the demand for the good), the firm is maximizing its resources. Move up the graph to the average revenue curve and you see that the average revenue at the MR=MC point is higher than the average total cost. This leads to pur profit. However, the monopolist can move that price back up the marginal revenue curve (which is equal to demand, remember) and finds that he makes even *more* profit by holding goods off the market.
Now let's look at the situation where the good/service is what is called a public good. A public good is a good/service that benefits everyone. Once produced it cannot be taken back. An example of this is a lighthouse. The lighthouse benefits the oil tanker just as much as it benefits the small fishing boat. The light from the lighthouse cannot be taken back. You also cannot charge the fisherman a different price to use the lighthouse than you charge the oil tanker captain. That light is out there for both to use, and can't be shut off if the fisherman doesn't pay.
In reality, there are very few purely public goods. Most are a combination of public as well as private goods. An example of this is electricity. It benefits everyone. It is in the public interest to have electricity. However, it is not in the public's interest for a monopoly to exist on the electricity supply. Or is it? Clearly we don't want the electric company to hold back its supply of electricity and only give it to those who can afford it. Everyone needs to have electricity.
Once company A lays wire and has covered the cost (no need to get into a discussion of amortization or depreciation here please) of that wire, it has dramatically lower costs than company b, which has to either lay its own wire or lease the wire from company a. Once the cost curve has dropped below the demand curve (as it does for a public utility), the monopolist no longer has an incentive to hold goods off the market. The maximum profit can be made where the marginal cost = marginal revenue. So in this case the monopoly is no longer a bad thing. Sure, the company can still charge whatever price it wants, but that is where regulation comes into play.
I'm sure this has been exteremly boring. Seriously, do yourself a favor and pick up a book on economics. It will enlighten you to a great many things about the way the world works.
Just to point out a definition or two:
natural = de jure
government enfored != natural
You don't make sense. But that is neither here nor there. Somehow you got modded up to +5, which shows that /. readers tend to be misinformed. Someone will repeat what you have said in this forum, and it is incorrect. I am trying to correct this so there might be a better understanding of economics on /., something that is sorely lacking around here.
Natural monopolies *do* exist, but essentially only in cases where the good/service provided is a public good or a necessity. Cell phones are considered a luxury and certainly don't fall into either of the two aforementioned categories.
Just because a company is established doesn't give it an advantage. Having a good reputation might, and better advertising might, along with other variables, but being established does not in and of itself give an advantage, and certainly not a monopolistic advantage at that. You are trying to apply arguments for one market configuration to a different market configuration. A corner store is likely part of a pure competition. An automobile manufacturer is part of an oligopoly. So is a cell phone provider. Neither are monopoly markets and neither works the same. You are comparing apples and oranges.
And how exactly is the government *enforcing* these monopolies?
Your arguments are so jumbled and incorrect I don't even know where to begin. Please, open and READ an economics text before you try to comment on it. If you *had* read an econ book, you would know that by "inefficient" I mean economically and socially inefficient.
/.: the patent. And that's not even enforced as a monopoly: patents can be licensed. Name another, I dare you.
Yes, but a government enforced monopoly is when the government prevents would be competitors from even considering the idea.
Name a government enforced monopoly. Come on, show me one. Just one. No, I won't wait for it. The only type of monopoly enforced by the government is the age-old bane of
Why don't you let the potential competitors decide what's wasteful and what's not.
Guess what? THAT IS HOW A NATURAL MONOPOLY FORMS. It's called barrier of entry.
The additional start up costs of laying telecommunications wire does limit competition in these industries, but it doesn't eliminate it.
The startup costs are the barrier. Once those wires have been paid for by one company, their cost curve drops drastically.
I suspect that also means two sets of cables.
Have a look at your cable and phone jacks, the ones that are connected directly to the poles or the underground network. How many do you have? Is there one labelled "AT&T" and one labelled "RCN?" I didn't think so. You can bet that one company (or government, even) owns those cables and the other is paying for their traffic to run on them.
BS indeed. Read an economics textbook and see just how misguided most of the bullshit on this website really is. A monopoly is not always bad, no matter what common sense or public opinion tells you. Here's one that will blow your mind: It actually makes *more* sense for the government to tax necessities rather than luxuries. Another one: A flat tax actually costs poor people more than rich people.
I anxiously await your misguided and likely incorrect response.
Theoretically, a "natural monopoly" was supposed to occur when a business experiences reduced marginal costs with increased production. Normally, when production increases, marginal costs increase.
Wrong. Marginal costs do not always increase as production increases. In fact, in most cases marginal costs decrease as production increases. Up to a point, anyway, and marginal cost begins to increase again.
This, supposedly, creates a situation that would allow the company to defeat all of its competitors.
The point here is that there are no competitors. That is the definition of a monopoly.
For example, once the electric company has run a wire to your neighbor's house, then it's cheaper for them to run a wire to your house than it is for a competitior to do so.
No, it just doesn't make good economic sense for a competitor to run a cable to your house. Not much point in having two sets of electric wires, is there? That's a waste of resources and that translates to inefficiency.
You have to compare a monopoly with pure competition in order to discover the concept of a natural monopoly. If the costs incurred by suppliers in a competition are equal to the cost incurred by a monopolist, then a pure competitive market is more desirable because marginal cost = marginal revenue. For a monopolist, price = marginal revenue and there is inefficienct use of resources.
If there are ten companies each running wire to your house, the total cost for that is much higher than is one company ran wire to your house. This means that the marginal cost curve for a monopoly is much lower than that for a purely competitive market. It is this lowered cost curve that leads to a natural monopoly, that is to say a market that is more efficiently served by a monopoly than by competition.
What are your credentials, anyway? You say "simplistic arguments that might fool a freshman economics student (and most Ivy League professors)," as though you have a PhD in Economics. Sounds to me like you didn't finish the chapter on monopolies.
How is it that a sophomoric comment like "wow I can sleep at night" gets modded to '5 Funny' but the reply which was much more clever is left at 0? I bet you people think the movie "The Sweetest Thing" was funny too. Geez.
Actually that's "Sine Your Pitty on the Runny Kine."
Followed up by the huge hit
I prefer "Don't let the door hit ya where the Lord split ya."
Yeah, the geek equivalent of omerta. Heheheh. There is no honor among software crackers. They are all little weasels that would rat out their friends in a microsecond if it meant the difference between getting Bubba-ed or continuing to live in their Moms' basements.
This guy is guilty. He's not an expert on anything but cracking and distributing software. Do we really need to interview him? I mean, what are we to gain from this?
And what exactly is that FTL communication method? We haven't quite mastered control of gravity yet. If concentration of matter or energy is required for these instantaneous gravitational changes, then we're required to break some thermodynamic laws to communicate FTL.
Actually it was Einstein's theories that postulated gravity as a distortion of spacetime.
Speaking of that...if gravity is a warping of spacetime, how is it that a body is ripped apart as it enters the event horizon of a black hole? Any of my physics professors that described black holes always said that a body would be ripped apart by the difference in gravitational forces as approaching a black hole. If gravity is a warping of spacetime, wouldn't mass in the warped space be warped as well, and therefore maintain its structural integrity?
I must be missing part of the picture here...I do actually have a bachelor's in physics, but this is something that I've wondered about for a long time.
When a respected magazine like Audiophile or at least Sound and Vision does a test like this, I will believe the results. Until then I will continue to listen to my compact-disc-sound-quality compact discs.
Allow your audience to tape and trade your concerts freely.
The Grateful Dead did it. Phish does it. Dave Matthews Band does it. U2 does it. Radiohead does it. Metallica did it. Note that I just named six of the top grossing concert acts ever. Combine that with a heavy touring schedule, and assuming your band is decent enough to draw an audience, they will rake in the dough.
However, if your band expects to make their primary income from record sales, you're gonna have to bend to the will of the record companies. Fact of the business.
Is the crap on tv that important to you people that you must record every second of it and save it for posterity? I'm sure that your life will go on if you miss an episode of Friends.
I mean, I like the show too, quite a bit actually, but if I miss an episode, I'm not going to spend much time worrying about being lost in the storyline. And if Coke decides to spend a little money to have one of their cans in the show rather than a Pepsi can, I'm not going to off myself in the name of anti-corporatism. Perhaps we could all focus our efforts and concern on something that matters a little more in the long run.
Ignore this issue and it will die the death it deserves. DRM on your PC won't happen anytime soon. If you want proof, look at Circuit City's failed DiVX format. The market sets the price, and the market has already said that it won't pay for something again that it already owns.
Can someone tell me why a moderator wasted a point on something everyone would ignore anyway? Can someone tell me why I'm wasting 1 minute of my life typing this?
Spoken like someone who knows absolutely nothing about economics. I won't profess to be an economic scholar, but you (and most other slashdot readers) have a skewed view of capitalism.
There are four things called "economic resources." They are land, labor, capital, and enterprise. Combined with technology (not technically an economic resource) they add up to output. Each resource is finite.
Capitalism, just as its name implies, holds that capital is the most important of these resources. Socialism, as professed by Marx, implies that labor is the most important. So important, in fact, that socialists consider that labor is the only economic resource. The political ideology of communism rests squarely on the tenets of socialism. Based on the fall of the Soviet Union, I think you can see that socialism was at least partially incorrect.
Back to capitalism. Capitalism is NOT a type of economic system. It is merely a philosophy that says capital is the most important of the economic resources. The definition of capital, by the way, is not money. Capital is anything you use to produce a product or service.
The computer I'm typing on is capital. The car I drive to work every day is capital. The websites I visit in search of programming help are capital. Given this definition, you can see why capital is important to the economic problem. No car? Can't get to work. No computer? I'll have to find another job.
Capitalism != greed. Each of us has specific material wants and needs, and those are infinite. If you think your material wants and needs are not infinite, you'd better think again. You put limits on yourself based on your economic situation, but if you can have it, you will take it. If you could afford a nicer home, you'd have it. If you could eat filet mignon every night, you would.
I would bet money that you don't live in a cardboard box. You probably do not donate all your income to charity. You probably drive a car. If not a car, at least a very nice bicycle. You can have and do these things because you are free to do so based on the Bill of Rights and they improve the quality of your life. If they didn't, would you need/want them? I think not.
Capitalism is a by-product of our constitutional freedom. It cannot erode our freedom for that very reason.
It's time slashdot readers grew up and started taking a more realistic view of the world and get over this fantasy that everything should be free (as in beer). Life does not work that way.
Let's see some intelligent debate. I'm sure I'm somewhat inaccurate on some of these points, as I've only actually had 4 Econ classes.
iTunes actually will manage your .aiff and .wav files, you just have to add them to the library manually.
Ah, but if you look at titles from 1999 or 2000, your comparison between DVD vs. VHS is also flawed. We are looking at market penetration *today*, not in 1999. More people own DVD players today than 3 years ago. The point of the article is that DVD is becoming as ubiquitous as VHS. Sure, Worst Buy and Circuit Shitty are pushing DVD over VHS, but that's because DVD makes them more money. Not to mention that those who own DVD players are more likely to purchase movies than those who own VCRs only.
So the comparison is fair. Movie sales are increasingly DVD-based, and that is the point.
Wrong. See the link in my .sig and you will learn why. I have approximaely 1500 audio discs that I downloaded from etree. These discs all started off as .shn (shorten) files transferred from DAT. Can you imagine the storage problem I have?
One concert takes up just a little over a gig, or two CDs of data and three discs of audio. A 50 gig removable disc would allow me to store an entire Phish tour in 16 bit 44.1 kHz CD quality audio on ONE SINGLE DISC. I can't wait.