Comment by lazyier | Hacker News Reader

Comment by lazyier | Hacker News Reader

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The only monopolies and trusts that existed for any length of time always had the backing of state government. Whether it's the royal crown establishing the east india company or local governments awarding exclusive access to local cable companies monopolies have always depended on state government.

The problem with sustainable monopolies in a free market is that there are a hundred thousand ways to skin a cat. Even if a particular business has a lock down on a particular resource it can't control alternatives. The only way a monopoly can be sustained is that businesses price things so low that there isn't any profit in competing against them with alternatives. And that is not really terrible and is not likely sustainable anyways.

Most people seem to operate under the misconception that somehow large corporate interests and large governments are opposing and balancing powers.

This is untrue.

Large businesses and large government are interdependent and complimentary. They feed into each other. They need each other. If you want bigger business you need to have bigger government.

The sort of ultra concentration of capital in the hands of a tiny minority of businesses and individuals wouldn't be possible without the government creating a regulatory environment to ensure that it happens first.

Well said.

And it should be noted that even when the monopoly does not exist, regulation and government intervention almost always favors the larger players in the market. In many cases, they are the ones writing the regulations. Those regulations make the barrier of entry more difficult and discourage new competitors from entering a marketplace.

Big business and big government are symbiotic.

It's not about the small/large government dichotomy, it's about plutocratic/democratic. '

>Even if a particular business has a lock down on a particular resource it can't control alternatives. The only way a monopoly can be sustained is that businesses price things so low that there isn't any profit in competing against them with alternatives.

This is empirically false, there are many ways a large business can lock down a market/resource, or very nearly so, and prevent competition from smaller upstarts. Look no further than two-billion-dollar-a-day-revenue Walmart, whose signature practice is running competitors out of town by undercutting them and sustaining the losses until they close.

Walmart is not a monopoly.

I, and millions of other Americans, shop at alternative grocery stores and department stores every day.

In fact with online retailing and hyper competition things are cheaper and easier and choices are more plentiful then at any other time in the past.

The problem faced by smaller retailers is that people really don't like going to them. It's charming and romantic to think about small hardware stores and local grocers, but the reality is that before Walmart came along and before internet retailer a lot of retail shopping was extremely expensive and downright miserable. Stores took advantage of people's lack of information about goods/services and lack of alternatives all the time.

The growth of internet retail and big box stores and big grocer chains like Costco/Walmart/Kroger/etc have actually done a lot to keep prices low and keep the economy healthy.

So, no. Picking on Walmart in this situation is pretty much proves the exact opposite of what you are intending.

> "Walmart is not a monopoly."

not if you're definition is that there must be one, and only one, market participant to be a monopolist.

but monopolies, in practice, are defined by market power (and monopsonies, by supplier power). you can control a market without 100% market share. that's the defining feature of a monopoly (market power), not market share.

walmart has both monopolistic and monopsonistic power in the US, despite thousands of small alternatives and a few big ones (like costco, target and amazon, which together form an oligopoly, that individually and collectively have market power).

I think you’re confusing monopolistic behavior with unethical behavior. As the parent said, the existence of a strong (larger!) competitor means Wal-Mart isn’t a monopoly. My local Wal-Mart has a Super Target and Kroger right across the street, for goodness sakes. It’s not a monopoly.

Undoubtedly, and the examples are numerous, Wal-Mart has used its market position to exploit its suppliers and to use their suppliers to creatively sell their own products.

But these scenarios aren’t the product of Wal-Mart exercising monopoly power, but rather exploiting those suppliers who violate rule #1 of manufacturing: don’t be dependent upon a single customer or that customer effectively owns you.

> "I think you’re confusing monopolistic behavior with unethical behavior."

no. and besides, that's a false dichotomy. i literally described the foundational understanding of monopolistic behavior by economists and regulators (that it's predicated on market power, not market share). this is a basic tenet taught early on in business schools and economics programs.

such clarifications are needed because many commenters fail to avail themselves of even a baseline understanding of the topic, which can be gleaned from just reading a wikipedia page let alone by having experience or even cursory training in the field.

it's tiresome to read the same shallow misperceptions over and over again. let's establish the basics quickly and move on to the more meaningful discussion that can be had.

Agree, let’s establish the basics. Here is the definition of monopoly:

the exclusive possession or control of the supply of or trade in a commodity or service

Dress it in as much nuance and confident language as suits you, it doesn’t change the reality that there is ample evidence Wal-Mart is not a monopoly.

> This is empirically false, there are many ways a large business can lock down a market/resource, or very nearly so, and prevent competition from smaller upstarts. Look no further than two-billion-dollar-a-day-revenue Walmart, whose signature practice is running competitors out of town by undercutting them and sustaining the losses until they close.

The Rise of Amazon as a serious threat to Wal-mart is a great example of the aforementioned principle in action.

In what way is the hope of liberty much advanced when one empire replaces another?

Amazon and Walmart are fighting each other, which is better for you and me. Also, it isn't all giants fighting it out. The rise of the dollar stores signals the return of the local small store that was once filled by the local mom-and-pop shops.

I'd think of dollar stores more like Queen Anne's lace - a hardy but not very worthy weed that quickly recolonizes disturbed regions, replacing but not reconstituting the diverse ecosystems that previously existed there, and easily outcompeting any attempt those plants might make to reestablish themselves.

Granted, Queen Anne's lace is a good source of nutrition for bees and wasps - a trait which dollar stores sadly do not emulate, cf. https://www.cbsnews.com/news/dollar-stores-and-food-deserts-...

So I have to say that, in my estimation at least, the plant comes out ahead. But even so, it's a mistake to confuse a thriving mass of Queen Anne's lace with a thriving ecology.

>This is empirically false, there are many ways a large business can lock down a market/resource, or very nearly so, and prevent competition from smaller upstarts. Look no further than two-billion-dollar-a-day-revenue Walmart, whose signature practice is running competitors out of town by undercutting them and sustaining the losses until they close.

A better way to word this is this: consumers chose Walmart over its competitors because they believe they get better deals there than the alternatives.

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