You're ****ing crazy. A 'benevolent' monopoly is as unsustainable as a 'benevolent' monarch. A curse wrapped in a temporary blessing is not a blessing.

That's a bad comparison though: Name one 'benevolent' monopoly. I can name several 'benevolent' monarchs, but for the life of me I can't think of any monopolies.

No of course not a benevolent monopoly. A monopoly that can not charge coercive prices due to potential competition. Standard Oil for instance, before it was broken up, had been lowering the price of oil as a result of its increased efficiency. That is not bad for the consumer. What is bad, is if a monopoly can charge coercive prices (ie. prices that maximize profits without the need to worry about competitors, potential competitors, or substitute products.) It is my assertion that with little government interference, this type of monopoly is very rare. Of course, I believe that patents should be protected by the government (for a time) and will lead to some coercive monopolies, but that is the price of innovation.

Businesses are free to do whatever they want to try to limit competition but almost everything (except getting government rules and regulation to help) generally proves ineffective after a short time. What exactly to you think a business will do in order to keep it's monopoly prices? The earlier poster mentioned buying out all competitors. It should be obvious that this will never be successful. As soon as the business community knows that every company that goes into industry X gets bought out then everyone and their mother is going to be going into industry X hoping to get bought out and make money. Obviously this can not go on forever.

The market will solve that problem! Wait, you're telling me that it's a good argument to ask a non-AE person for details, but it's not a valid question when posed to an AEist (whose usual reply is 'well, I'm not that smart, but someone else will figure it out'. Actually, that'll be my answer...what I think is that someone will figure it out! Bingo! QED.

I am not the earlier poster, and that's not my argument.

I would argue that with no violence or government interference, there is no way a business could posture, or strategize in a way that would effectively keep them free from worrying about competition. I asked because, I have studied quite a bit of business and I believe that whatever way a monopolistic business comes up with to keep competition out can and will be exploited by other businessmen for profit until they are forced to change. Or it might not work at all. So no, someone won't just figure it out. I can't give you a specific answer though unless you give me a specific challenge.

I don't think you're thinking deeply enough about this. Certainly there are markets in which monopolies just couldn't form. But there are others where it's simply not obvious that they wouldn't. Markets with large networking effects (facebook, anyone?) or with large fixed costs (the old AT&T, satellite radio) come to mind.

Also, it's a small example, but the market for mud for baseballs is a monopoly.

You still don't seem to understand my main point. Yes, normal monopolies can exist in abundance. Coercive monopolies (basically monopolies that charge very high prices without fear of competition) can not exist in abundance. Just because it is hard for a new company to enter industry X and be competitive does not mean that the major player in industry X is a coercive monopoly and should be broken up.

The negative effect of a coercive monopoly is that it raises the price above where the market price would be on the supply demand curve. It can do this because it faces no competitors. It allows firms to earn above normal economic profit and it hurts consumers cause they have to pay more. In some instances (see patents,) this is acceptable and in the spirit of free market competition, in other instances (see a single government licensed casino) this is unacceptable and directly against the spirit of free market competition. If a monopoly is not a coercive monopoly, then it is by definition, not hurting consumers and it totally in the spirit of a free market economy and should absolutely be allowed to stand. The only people that are hurt by this type of monopoly are the smaller, more inefficient competitors who certainly do not have a "right" to make money in a given industry.

Facebook now, and the old AT&T may beat all competitors because they are better companies. But they will not be able to survive if they raise their prices significantly above the markets supply demand curve regardless of any business strat that they use. (absent violence + gov interference.) I don't know anything about muddy balls sorry.

The old Bell Telephone monstrosity was pretty coercive. My cable company indulges in price discrimination all the time. The power company in my area provides literally the worst customer service of any company on planet earth.

The railroads used to be incredibly coercive before they were regulated, US Steel was incredibly coercive, and despite reducing prices Standard oil intentionally drove small competitors unwilling to sell out of business as standard practice.

I think you have this image in your head of what a monopoly is. It's wrong.

No, I get your main point (main claim actually). Just because I disagree (for very good reasons) doesn't mean I don't get what you're saying.

WTF does this mean? They've beaten all competitors, they're monopolies, and...? You don't think competition is stifled because of AT&T's historical existence? You don't think prices are higher because of AT&T's monopoly?

Simply asserting that for the Nth time doesn't make it true. What about AT&T not allowing anyone onto it's system? They have links to all phones in everyone's house. You need to set up a phone. Who are you going to contact, AT&T, or no-name, with whom you could call about 10 random people you don't know? There's a strategy that would keep them in monopoly. And don't you think AT&T could charge a premium? Same thing w/facebook...

Don't try to educate yourself about another example of monopoly, you might have to change your mind then.

[QUOTE=Coffee;33193722]1)
3) CEOs do not pay themselves. Their salaries are determined by the board and presented to stockholders. There have been several recent high-profile instances of stockholders refusing the pay schemes indicated by the board (Citigroup, for example).
QUOTE


you have a broad array of stockholders, and the board is picked by the executives..

How would stockholders go about makeing changes in pay and retraining workers? etc etc

[QUOTE=Janice7776;34258801]Board is not picked by executives.