In his example of getting research funding, it's a step function: either you get funded (y=1) or you don't (y=0), and because you're competing with others, even a small output increase can take you from the 0 side to the 1 side.
A myth of capitalism is that the donkey can reach the carrot hanging from the stick if they work harder, that "almost all" can be won by those who are being driven to work more hours. However, this doesn't take into account that there are at least as many carrots-on-sticks as donkeys, and that carrots are cheap.
What isn't between those two poles?!
That's the myth of the "American Dream", not Capitalism per se.
Capitalism is more simple, if you have capital, you have control, and with control you can profit.
1. A bachelor's degree in engineering, biological science, physical science, computer science or mathematics.
2. At least three years of related professional experience obtained after degree completion OR at least 1,000 hours pilot-in-command time on jet aircraft.
3. The ability to pass the NASA long-duration astronaut physical. Distant and near visual acuity must be correctable to 20/20 for each eye. The use of glasses is acceptable.
4. Astronaut candidates must also have skills in leadership, teamwork and communications.
Checking all the boxes on that list isn't particularly hard to do. However you aren't competing with the list.
You are competing with a 29 year old Rhodes Scholar with a PhD in Chemistry, who runs Ultramarathons, ran a 40 person volunteer organization in Kenya during her gap year, and manages a 200 person 50 Million dollar research lab on pluripotent stem cells at Oxford.
Now just change out anything there with whatever would be relevant for your line of work, and thats who you are competing with - give or take.
[1] https://www.nasa.gov/audience/forstudents/postsecondary/feat...
Capitalism tends towards winner-take-all systems, but not all winner-take-all systems are capitalistic. I find the example fitting.
Use an example of capitalism to justify an example of capitalism. If capitalism is a winner-take-all system, there should be endless examples.
> the red car may be cheaper if lots of people want it.
Also see the pharma industry, right? The US government isn't all governments either, in some countries parties actually rule together, compromise and whatnot. And considering getting money out of elections isn't even attempted in earnest, the question really is what is the tail and what is the dog here.
It just means things are a lot more "costly" for Blue and/or Blue things (like climate change policies).
But of course in the primary layer a lot of things become infinitely costly for Blue things. (Because they fall under executive rights.) But there are a lot of other layers. (State legislatures/governors, city level issues, and so on.) And though a higher layer can force things on a lower layer, but it's not zero-cost, so usually things settle into an ugly compromise.
What I wonder is: Is this really an intrinsic quality of capitalism? What causes this "winner take most" reward system emerging in some areas of the economy but not others? In many industries, multiple competitors can exist with stability and split market share, and in others, having multiple competitors leads to a blood bath where only one can survive, winning it all.
Somewhat ironically, this fact actually has connections to the concept of dual variables in constrained optimization problems, the theory of which was largely developed in the Soviet Union for use in central planning.
Hardly. The history of capitalism shows that absent government intervention to prop up companies, they rise and fall. When I started out, everyone was a-feared that IBM would inevitably take over the world. Then Microsoft dethroned them, and Microsoft was going to take over the world. Then Apple dethroned Microsoft. And on it goes.
There was Sears that dominated retail. Then Walmart shoved them aside. Now Amazon stepped all over Walmart.
See "The Innovator's Dilemma" by Christensen for a book full of examples.
There are plenty of counterexamples from before that regulation, and there are still some today (e.g. ISPs).
Name one :-)
A little disingenuous to pretend that never happened.
See "Titan" by Ron Chernow
> pretend
I know what the popular wisdom is. But dig a little deeper and you'll find it is not correct.
> General Motors
was formed in 1908. The Sherman Antitrust Act was in 1890, so GM could not have been the reason for it.
...which, to clarify, was not my point.
That is, going back up-thread a bit, it's still clear that capitalism intrinsically encourages monopolistic behavior, and that "government intervention propping up companies" is not the cause.
In fact, I would go so far as to say that even if there were no capitalistic tendency toward actual monopolies, it would still have the same winner-take-all problem, merely due to the prospect of a "winner".
A prospect and an actual problem are two different things.
SO was never convicted of being a monopoly, either. A subtle but crucial point, and usually overlooked.
My point is, again, that in this case the prospect is what causes the problem.
The "problem" was that kerosene prices dropped 70% under SO.
The real problem was that Rockefeller was rich, and then (like today) a lot of people just can't stand the idea that others are rich.
If you're really interested in going beyond soundbites and understand what was happening, I really recommend Chernow's "Titan". Chernow actually agrees with you, so you can't argue his book is unfair. Chernow's opinions, however, are not congruent with his presented facts in the book. He's just so convinced of Rockefeller's evil nature that he is blinded by his own narrative :-)
But to spell it out, the problem is that the winner-takes-all aspect encourages people to overwork themselves or their employees, despite the diminishing returns that brings.
Maybe you're just so convinced of capitalism's good nature that you were blinded to what we were talking about in the first place? ;)
Few define business success as erasing all competition. Success is making a good profit.
dont you think its kind of upsetting when someone could improve someone's life drastically without any (practically speaking) detriment to their own. obscene wealth is upsetting to me, and i know lots of people who have it, and i dont hate them. so its not about the person, per se. i just find it extremely unfortunate, knowing first hand how things could be different, in an almost pareto improvement way.
right now there is someone who will die because they cannot afford proper medical care. the is almost certainly someone with a lot of money, doing nothing with it, that could fix that at no cost to themselves. thats a little upsetting right?
It's also a bit myopic to view companies as a binary monopoly/not monopoly. A company with 90% market share isn't a monopoly, but has most of the downsides of a monopoly, and likely is a monopoly within subsets of the market.
Out of curiosity in calibrating your definition of "monopoly", can you give an example of a monopoly (past or present) together with an estimate of their market share? Thanks.
Up until a couple years ago, in Washington State, hard liquor could only be sold through state stores. 100% market share.
The plumber's union is a monopoly. It is illegal to hire a non-union plumber. 100% market share.
Anyone holding a patent, trademark, or copyright has a monopoly. 100% market share by law.
And I find (have found) that I'm much more inclined to do the boring things when I've finally exhausted my curious/creative mental faculties.