Comment by jay_kyburz
2 years ago
There is just not enough competition any more. When you have only a handful of competitors in a market, even without collusion, its easy for them to all to just decide to raise prices at the same time.
I think you need significantly more competitors so that there is less chance for "accidental collusion"
What I really think will get be down-voted around here, but I think there should be state run (nonprofit) (but run at cost) offering in every market, and if the for profit companies can't compete against inefficient government run businesses then they should not be in business themselves.
We should leverage our collective power to set a baseline performance metric.
For example: Australia Post runs at a small profit rather than at a cost to taxpayers.
The problem is that if a really successful private business does compete, or many, then that takes away from the revenue the Australia Post can reinvest into its operations. Now in this theoretical scenario, Australia Post has a choice to make. Close shop, since the reduced pool of customers and thus revenue is not sufficient to fund its current worker pool. Or raise prices and innovate. Or operate at a loss (who does that?), or be subsidized by tax payers one way or another. And then you end up right back into the current state of economics, which is inevitable, and operates as its own organism and agenda.
I would think shipping to Australia is something any outside business would avoid given the cost of it being in BFE. So naturally a solution was implemented to keep its citizens happy. If it was as cheap to ship to Australia as it is to ship between borders, Australia Post wouldnt exist.
Yes, absolutely, its complicated. Do the state owned companies compete on quality or price? Are they required to cater to all segments of the market? How much of a loss can they take and for how long before they are closed down? Do you run separate orgs in each state and have them competing among themselves?
They are all hard problems, and its unlikely we would make the right decisions every time.
But I think its an interesting thought experiment.
Its certainly atleast trying to do something.
In a way this would be like cap the % profits. And just like capping the profits… you cant do that because why should the super effective companies get punished and not gain massive profit!
There is a contradiction in our system - if the companies drive the prices down they digg their own grave. And since they have to grow not stagnate then at some point they need to stop driving prices down and also more and more fuck people over.
So it is greed. Imagine companies that wouldnt grow.
What you're saying is not unreasonable and not too far off of WTC anti-dumping laws. It deals, albeit at a national level, with corporations undercutting domestically manufactured goods at a loss to drive them out of business, only to drive prices up later.
https://www.wto.org/english/tratop_e/adp_e/adp_info_e.htm
You can optimise that by giving the competition authorities the power to initiate a public competitor if, and only if, there are price rises in a market.