We're really doing this thread again? Really?

There is no way there is anything left to be said. People must really prefer typing to reading.

Yes, let me prohibit paying customers from accessing my road.


















Not.

If this was directed towards my post:

1). I know what predatory pricing is
2). The scenario described in my post isn't exactly predatory pricing, at least as far as the examples in that wiki page--there are critical differences between bromine (resellable) and roads. (though there are some similar characteristics).
3). There is a 'Support' section in that wiki article.

If you have a point though, please make it.

If you want to maximize profit, you will want to turn away 'paying customers'.

Besides the fact that I don't agree with your assertion that those points have been established, it's pretty entertaining to watch people who absolutely refuse to concede a point seriously try to argue that it is feasible to build overpasses over peoples property in order to compete with existing roads.

Yes, let me maximize my profits by not letting anyone access my road. I will surely get super duper rich with this business plan.

Question: would you rather get $4 from 100 people or $2 from 150 people? If you prefer the $4 from 100 (which does maximize profits), you're turning away paying customers.

The only way not to turn away a paying customer is to make sure you're charging 1 cent. Or have some way of knowing exactly how much they're willing to pay.

You are missing the point, as has been a tendancy for you in this thread. Roads monopolies are in no technical/economic way different than any other monopoly. If the monopolist is so interested in maintaing profits to go to such great lengths keeping out competition, he is likely to know what is the just price for his service to maximize his profit.

T But you're scenario isn't realistic, because you have no way of showing that the monopolist could get away with charging more when this has never been done in the history of economy, nor do you have anyway of showing that some other entrepreneur can provide the same roads for a fraction of the price. Never has a monopolist/cartel been successful in raising his price above market level and simutaneously maintain 100% market share or maximum profits. You're scenario is nonsensical.

? Do you know what a monopoloy is? And the incentive is called profit. If a monopolist's profits are dwindling due to bad management/unreasonable prices he will be forced to liquidate his assets (ie sell a portion of his roads) he will then have competitors that will hold him more accountable.

Lol it's a big assumption to assume that the government wouldn't want to surrender a monopoly in roads? Especially a government made up of people libertarian enough to realize the benefit of a private roads system?

And GL getting all of the competitors to agree on it, that scenario is even more unlikely, as has been the case of every cartel in human history. They, like natural monopolies, never last long.

Once again I will reiterate that roads are a good/service like any other, and do not defy the laws of economics.

http://mises.org/books/roads_web.pdf

You might want to read this if this topic fascinates you so. it's written by an expert who has spent his entire academic career advocating privatization of the entire planet.

I am using demand correctly. Demand for transportation may fluctuate only moderately, but with an aubsuive monopolist demand for roads will plumett greatly and demand for alternatives will increase greatly.

Air travel is innovating rapidly.

And obviously innovations like this, which only occur on a free market, will create a lower demand for roads.

And of course there is less incentive for people to build roads. Roads aren'tt he ultimate goal, transportation is the ultimate goal. If a monopolist attempts (always unsuccessfully) to take advanatge of his market share, other entrepreneurs will find away to satisfy consumer demand for alternatives to the monopoly. Whther that means building new roads, or new technologies, the entrepreneur will always find a way to satisfy consumer demand.

All monopolies that exist today are government fiat. No monopoloy could last under AC, there have been monopolies that have existed (Standard Oil) but have quickly died because of their failure to manage once they've acquired the entire market.

Sadly, you weren't. You seem to be using it better, but putting together like 'demand being satisfied' isn't correct economics. Oh, and you are actually using demand wrong in the paragraph above. The *quantity demanded* of roads will decrease if you have to pay more for roads. The demand for roads doesn't change if the price changes.

I was asking you to clarify because I wanted to understand what you were saying...
If yo'ure still replying to me (I can't see, given how the quote function works), I have shown why other roads wouldn't be built.

However, I have given an example in which a monopoly may last under AC. I have shown a way for the profit mechanism for entry to not exist, even though the monopolist is making positive economic profit.

BTW, other monopolies are prevented from forming by government fiat as well. So you can't really use the fact that no 'non-government' monopolies exist under the current system to say they can't under ACism.

that's not what anyone is saying, afaict.

You are confusing demand for transportation with demand for roads. changing a price of a certain good can influence the demand for it, if carrots cost $10000 a stick demand for carrots will drop.


And as for correct economics, there are different schools of economics that look at the world differently. While "satisfying demand" isn't conventional, I've definitely read it before by published economists.
I never said any of this, that "non-government monopolies can't exist under ACism". And frankly I'm getting tired of repeating it.

You have been raised by your government public school to believe monopolies are inhernetly evil, they aren't.

natural monopolies/cartels are extremely hard to maintain under free market conditions, and it is as likely for a monopoly to live forever as it is a human being to live forever. There is nothing special about roads that makes maintaining a monopoloy any easier.

Show me one example in history where a monopoly would have survived without government intervention.

You are confusing demand for quantity demanded.

The quantity demanded of carrots will drop. The demand itself will remain constant. At least, that's how Economists use the word, and since we're talking about economics...

I would guess there's a bit of an explanation as to what is meant by that phrase when it's used. As a stand alone phrase, it's horribly unclear. And getting back on track (ignoring the demand vs quantity demanded issue) that's what I wanted. A clarification as to what you meant. By the way, I didn't mean to appear as if I was attacking you, but I did mean what I said...what you were saying was unclear, I wanted to tell you why, and ask for a clarification.

Other ACists have. And that's who I want to engage in--if you think they can exist, great. We have no debate then. But it does seem to be the position of most 2+2 ACists that no monopoly can exist. Probably arises from the kneejerk reaction that nothing bad can ever occur in ACland...

Strange, as I was just talking to some people today and said that monopolies can be a good thing.

Actually there are "special things" about roads over other things (say the Bromine in the wiki article about predatory pricing). I can resell bromine. I can relate a piece of information that someone tells me. But if I want to travel from A to B using a road, I can't have someone else travel for me, nor can I resell the trip to someone else once I've taken it. Nor can I buy road travel in one market and resell it in another market.

Again, that doesn't address my question of how in my situation the monopoly on roads could exist. The rules in ACland are quite different (for the better or worse) than the current rules.

The argument is not that a monopoly has total control of the market, and that evidence otherwise negates any problems with it. Suppose I have a monopoly on producing Good X, its marginal cost is $5 but I sell it at $20. The best that other firms have to offer is Good Y, an inferior substitute that they sell at marginal cost, $15 each. Now, it's true that the existence of Good Y probably stops me from charging an even higher price. However, that doesn't change that I'm still charging much more than the perfectly competitive price.

Could another firm eventually develop a good as cheap as Good X? Sure, it's possible. But so long as I have certain cost advantages inherent to my monopoly, it's unlikely. And consider that even if this can eventually occur, it may be wasteful. Suppose that roads are the most economically efficient way to travel, but Firm A has a monopoly on roads. Firm B spends a large amount of money developing a substitute for roads that has the exact same marginal costs and benefits as roads do. Competition drives prices down, but there was "social waste" in the development of a superfluous new technology.

But they are different, because a system of roads is not like a storefront or office building that you can plop down anywhere; a system of roads necessarily requires the ownership of property that spans across the entire area that you want your business to serve. And, as a consequence of topology, once one road system has been established in an area, there is no way to establish another without it intersecting with land already owned by the first road system. If the owner of the first road system will not give permission for other roads to intersect his property, and can trivially block other roads from being built over or under it, there is no way for a competitor to build a competing road network. That is why I believe this to be a special case: no other business prevents, by it's very existence, competition from forming.

And why would the monopolist have to "go to great lengths" to keep out his competition? All he has to do is deny them permission to build on his land.

But we've also never seen a modern system of privately owned roads, so you can't just claim that, because no road monopolies have arisen before, it would be impossible now.

As for your claim that there's no way of showing that another entrepreneur could provide the same roads for a fraction of the price: shouldn't another entrepreneur at least have the chance to do so? As it is, whether or not someone could run the roads more efficiently becomes irrelevant, because they will have no chance to do so regardless.

Why would the monopolist's prices dwindle due to unreasonable price? Are you saying that it's impossible for him to increase his profits by leveraging his monopoly power to jack up his prices? It's not like he's selling computers and people can just buy from someone else or not buy a computer at all; the vast majority of people need road access, and short of moving out of town, they have very little choice but to pay whatever the local road owner charges.

And back to the incentive point, what I'm saying is: if the local road monopoly determines it can maximize profits by charging X dollars for road access, and another road company buys up the local road monopoly, what incentive do they then have to drop the price from X? They now own the same monopoly, and would also seek to maximize their profits. You've traded one overcharging monopoly for another one.


The problem with other cartels is that there's nothing to prevent new competition from entering the mix and disrupting their monopolization of the market. With a road cartel there is no way for a local competitor to arise without violating existing property.

Let me demonstrate what I mean by "locking out the competition" more clearly via the wonder of MS Paint:




In this diagram of a small town, the blue lines represent the roads that are owned by me. Suppose that you, a local entrepreneur, decide that I'm doing a lousy job of managing the roads. Maintenance is shoddy, prices are too high, and by George, you could do better! Through the power of the free market, I will either be forced to provide better, cheaper service, or I will go out of business and you will own the local roads. There's only one small catch: I won't let you build any roads inside of the town that cross over my own roads.

With that in mind, please indicate where you will build your competing road network to better serve the town.

Notice, by the way, that no paying customer is prohibited from accessing my roads. I have no trouble joining my roads up with roads leading into or out of town: my roads are strictly local, and so the roads between towns are no competition to me, and I'm not locking out any potential out-of-town customers.

However, if someone wants to go from the Wal-Mart to the school, it's my roads or nobody's.

Presume I own the world. How will you compete?

CHECKMATE


wtf

Yes, you're right that I can't compete with the roads inside of Disneyworld. Of course, all the people in the houses, the school owners, Tiger Woods and Walmart can choose to build there **** in places were a moron doesn't own all the roads.

Seriously, do you people actually believe these things are problems? You just manufacture some ridiculous hypothetical and act like this proves that people can't figure out how to voluntarily move around without the use of guns to take people's **** so they can put asphalt on the ground? Really?

God I'm sick of these sorts of threads.

I don't own the world. I own a few blocks of road system.

Maybe the roads used to have a different, more reasonable owner before I bought them? Maybe the roads used to be own by multiple competitors until we all merged? This is not a super far-fetched scenario.

Again, what's so ridiculous about this hypothetical? All it requires is for someone to own a few choice roads in an area.

The monopolist would prohibit intersections, not access roads.

I don't even begin to know where to tell you what is wrong with your hypothetical if you don't know what is wrong with it. Do you know how many neighborhoods there are in even a small town? Hundreds. If you're reaping huge monopoly profits off of the idiots who actually moved in, think of the money I could make building a competing neighborhood and undercutting you, AND letting people actually have access to roads to come and go! And then of course, your monopoly profits get competed away and then nobody lives in your neighborhood and you either shape up or go broke.

And so what if someone buys/builds a neighborhood, doesn't let anyone connect, and charges an arm and a leg and actually convinced some complete morons to voluntarily live there? Do you know what a hot dog costs in Disneyworld? Do you think the government should take it over and run all the evil private roads there?

I mean seriously, do you people actually find any of this persuasive? The ENTIRE ARGUMENT is "gosh I can't figure out how to compete therefore nobody possibly can" hence we must have a giant gun-toting bureacratic monopoly run the world.


what


the


****



I swear to God I don't know how anyone believes any of this ****.

I'm so sick of people who just dismiss arguments as being self-evidentally wrong and then go on a rant about the person supports using GUNS TO STEAL PEOPLE'S ****!

Here are my hypotheses:

a) AC roads aren't as as efficient as you've claimed, making you angry so you decide to redirect attentions to "Well, so what? YOU STILL SUPPORT THEFT OF MY ****!"
b) While there might be a way for AC roads to be more efficient, you don't know what it is, but you don't want to appear weak. "Stop asking me how things will work under AC-land! People will figure something out! THEY HAVE TO! GUNS! GUNS! YOU SUPPORT THEFT OF MY ****!"

Or maybe there is a nice, logical way to frame your argument, but I haven't seen it, so I'm guess I'll jump to one of those conclusions now.

This would be all well and good if the road owner owned all the properties as well. This is the fundamental point which differentiates it from a mall or Disneyland. If Disneyland starts raising its prices significantly in one area, it hurts the rest of its business. If a road company raises it prices, it hurts other properties but it doesn't own them, so it has no incentive to take this into account.

I agree that people will figure out a way to solve this. I'm quite confident, however, that this solution will be to form something that is effectively a government. As you can see from above, it makes sense for the roads to be owned by the property owners. They will form a large homeowner's association to provide this. This ends up looking pretty similar to a city government today.

Aren't people on the internet so aggravating? Are you fuming in your seat right now?

"I'm so sick of people who just dismiss arguments as being self-evidentally wrong and then go on a rant about the person supports using GUNS TO STEAL PEOPLE'S ****!"


Agreed. O.P. has been logically consistent and has accurately stated the ACist position at all times. He deserves a lot more respect than he has received ITT; I for one welcome the honest debate and this is a very tricky subject.