Comments on: Domestic Protectionism http://cafehayek.com/2008/07/domestic-protec.html where orders emerge Sun, 21 Mar 2010 13:30:09 -0400 http://wordpress.org/?v=abc hourly 1 By: hutch http://cafehayek.com/2008/07/domestic-protec.html/comment-page-1#comment-27433 hutch Mon, 14 Jul 2008 12:28:49 +0000 http://localhost/wordpress/?p=3185#comment-27433 <p>For what it's worth, I'm halfway through Titan by Ron Chernow (about John D.) and am really enjoying it. The funny thing to me is that the author often talks about competition as if that's goal. He mentions how something or another was bad simply because it was anticompetitive (like predatory pricing or significantly overpaying for a refinery simply to reduce capacity). He misses the point that the goal is to make stuff that people want to buy at a price they want to pay. There's no point in enforcing competition simply for its own sake. Unless a monopoly is granted by the g-ment, it will face competition in some form or another.</p> <p>My favorite story I've read about so far is about how they discovered some oil in Ohio that was inferior to Pennsylvania oil b/c it had a lot of sulphur in it. John D. basically told some guy to figure out how to make it work b/c they needed new supply to replace the existing supply that was running out. In the meantime, John essentially subsidized the firm's investment in that part of Ohio by personally taking on all the risk of loss but passing the gains on to the firm. Of course it worked. Chernow ended the story by quoting someone as saying "The greatest invention of the 19th century was the invention of the method of invention." There's more to it than that, but it's a cool story.</p> For what it's worth, I'm halfway through Titan by Ron Chernow (about John D.) and am really enjoying it. The funny thing to me is that the author often talks about competition as if that's goal. He mentions how something or another was bad simply because it was anticompetitive (like predatory pricing or significantly overpaying for a refinery simply to reduce capacity). He misses the point that the goal is to make stuff that people want to buy at a price they want to pay. There's no point in enforcing competition simply for its own sake. Unless a monopoly is granted by the g-ment, it will face competition in some form or another.

My favorite story I've read about so far is about how they discovered some oil in Ohio that was inferior to Pennsylvania oil b/c it had a lot of sulphur in it. John D. basically told some guy to figure out how to make it work b/c they needed new supply to replace the existing supply that was running out. In the meantime, John essentially subsidized the firm's investment in that part of Ohio by personally taking on all the risk of loss but passing the gains on to the firm. Of course it worked. Chernow ended the story by quoting someone as saying "The greatest invention of the 19th century was the invention of the method of invention." There's more to it than that, but it's a cool story.

]]> By: Floccina http://cafehayek.com/2008/07/domestic-protec.html/comment-page-1#comment-27432 Floccina Mon, 14 Jul 2008 10:46:54 +0000 http://localhost/wordpress/?p=3185#comment-27432 <p>I should add and so that even with monoply profits we consumers could be still better off if the increased effciency due to being close to the optimal size swamps the monoply profits. </p> I should add and so that even with monoply profits we consumers could be still better off if the increased effciency due to being close to the optimal size swamps the monoply profits.

]]> By: Floccina http://cafehayek.com/2008/07/domestic-protec.html/comment-page-1#comment-27431 Floccina Mon, 14 Jul 2008 10:30:16 +0000 http://localhost/wordpress/?p=3185#comment-27431 <p>IMO there is an optimal size for organizations engaged in any given activities and that tech changes change constantly change this optimal size. Thus it is important to allow organizations of any size as long as they do not use coercion to keep there competition down. This allows organizations to continually move toward that unknown optimal. </p> IMO there is an optimal size for organizations engaged in any given activities and that tech changes change constantly change this optimal size. Thus it is important to allow organizations of any size as long as they do not use coercion to keep there competition down. This allows organizations to continually move toward that unknown optimal.

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