the _best case scenario_ for this economic model leads to a terrible status quo
Terrible status quo? You realize that competitive pressure is what drives progress right?
Terrible status quo? You realize that competitive pressure is what drives progress right?
Except when it doesn't. It's perfectly possible to have, for example, a bunch of scientists crazy motivated to learn the answers to their questions and all collaborate as cooperatively as possible toward that end. Adding competition could result in duplicated effort, secrecy… or to added pressure and motivation… I mean the one thing we can say is that there's no guarantee that competition is good or bad for progress, it depends on so many factors.
You can reasonably say that competition can drive progress. Your sentence implies that it is the primary (or sole??) driver of progress, and that's nonsense.
Consider Richard Dawkins' tree analogy: competition is what drives trees to become super tall, but that means they spend tons of energy doing that. Being tall in itself has no value to the trees. Yes, evolution inherently creates ecosystems around tall trees, but that doesn't mean that particular ecosystem is somehow better than other possibilities. It's more true that competition is just a fact of life rather than that we know it to be good or bad. There are tons of cases where reduced competition and increased cooperation can provide more progress.
>You can reasonably say that competition can drive progress. Your sentence implies that it is the primary (or sole??) driver of progress, and that's nonsense.
actually competitive pressure is the primary driver of evolution. Some aspects of evolution when applied to humans we call progress.
>There are tons of cases where reduced competition and increased cooperation can provide more progress.
cooperative behavior in a group evolves when it helps the group to compete, and thus it may result in increased competition between the groups. Organized human society would be an obvious example of cooperative behavior. Massive battles and wars and other atrocities inflicted by the human societies upon each other, and overall effect of the human society upon the rest of the Earth species doesn't seem to qualify as reduced competition. If anything, increased competition between organized human societies, like wars for example, has significantly sped up the tech progress as a result of the need for weapons development.
And that is key. Indeed, competitive pressure drives evolution (but isn't the strictly sole driver or the mechanism of evolution itself). The most important point is: evolution only values survival/reproduction, it doesn't value "progress".
There's a very strong argument that humans now understand evolution enough to make conscious decisions not to just play the natural competitive game. We can actually make a better world by refusing to follow that natural game. Life in competitive natural circumstances is brutal, painful, and short. We value progress as in human (and non-human even) flourishing, happiness, scientific progress, etc. and we get those things best by refusing to just act like competitive evolution but instead by rising above that. For example. we have no evolutionary benefit in caring for the least among us as an entire global human society but when we do so, it's because we recognize the ethical value.
But on an ethical level we have to acknowledge that "letting the markets do their thing" doesn't automatically reach the best result. Me having all the money and you having none is a Pareto optimum, after all.
If we could make many people's lives better at the cost of a tiny bit of progress, we should consider it.
There's also the fact that progress isn't a line. Native ads are "progress". Bail loans are "progress". Employer-based health insurance is "progress". Society can make decisions that go beyond what makes people more money.
The free market is an equilibrium that represents an average of all of our subjective needs, wants, and judgments. No individual will ever see all of its outcomes as ideal, but any attempt to 'correct' it will necessarily favor one person's values at the expense of someone else's.
A change might come at the expense of one person, but can potentially help many more.
A 50.1% majority does seem to be what we use to decide things (with some edge cases meaning sometimes you need more , but rarely do you need less). One person, one vote and all that. Systems not perfect but it's a lot better than restricting to property owners
The economic behemoths regularly change shape, form, and function and others replace them. Believing that we're at the final result of everything seems misguided at best.
That's one possible explanation. I think a much more plausible explanation was that Steve Jobs needed a significant amount of capital infusion to turn-around Apple but he needed the terms to be reasonable, which was why he leveraged on his longstanding friendship with Bill Gates even though they were (unequal) competitors at that time.
It's next to impossible to get any form of capital for a dying company, whether debt or equity without having cut-throat clauses included to protect the investors' capital.
"In a remarkable feat of negotiating legerdemain, Apple co-founder Steve Jobs got needed cash — in return for non-voting shares — and an assurance that Microsoft would support Office for the Mac for five years. Apple agreed to drop a long-running lawsuit in which they alleged Microsoft copied the look and feel of the Mac OS for Windows and to make Internet Explorer the default browser on its computers — but not the only choice."
Is the eradication of small business in favour of cheap mass delivery progress?
It probably looks like progress on Amazon's balance sheet. But I doubt everyone in the supply chain is as happy as them.
We know that that has been true in many cases, but we don't know that it always will be true in all cases. For example, I don't think there's a very good argument that competitive pressure has led to a super high quality healthcare system in the US vs. the rest of the industrialized world. Competitive pressure optimizes for certain things, and those things are not always what is best for the public. Especially, if "competitive pressure" is applied by a trust, it can cause market failures.
I don't know that Amazon is that. Maybe it will be. But, last I checked, we do still have ground floor retail. I think there's an equilibrium that we'll reach at some point, where retail space commands lower rents and has to provide a high quality shopping experience. The Best Buys of the world are done for, but the Nordstroms are not.
Allow doctors to be "certified" by private organizations, then watch how quickly medical schools change, residency allotments open up, and doctor ranks swell. As the supply of seats in medical schools and number of residencies rises, the cost of medical school will decrease. More doctors with less debt will put downward pressure on medical prices.
You may argue that quality would not increase under such competition, but I disagree. People who can't afford healthcare would be able to afford poor quality healthcare which is better than they currently enjoy. Rich people will still have vanity certified doctors. In general the cost of comparable quality healthcare would be lower.
TLDR; don't complain about disappointing results of competitive pressure in a market with very limited competitive pressure.
That's because there really isn't any competitive pressure. Not for consumers anyway. The way our healthcare is tied to our employment means we get little choice in providers ourselves, leaving that decision to our employers, who probably don't have our best interest at heart.
Up to a point. E.g. in non-equilibrium thermodynamics systems can change from negative feedback and stability to positive feedback - finally they explode and reorganise themselves. Like society or the market. Nice model, as long as we are not in the middle of such an explosion.
Google: Yahoo!
Facebook: MySpace
Tesla: The Automotive Industry
My doubt is about these economic theories. I worry about the many dangers with Amazon's burgeoning monopoly.
A lot of preconceptions may be in the way though in trying to understand this.