Comment by nickpp
3 months ago
What you are describing is how governments prop-up incumbents. But this rarely apply to startups, who seldom stand a chance at getting government contracts and the like. Entrepreneurs will ignore those and build the startup from the bottom up, with small customers first.
Of course a less corrupt government could help here, like the x-prize helped SpaceX and electric car subsidies helped Tesla. But that's too much to ask from politicians of most countries.
To actually prevent startups competing and disrupting the market, I maintain that regulations are much more effective: they will prevent entrepreneurs from even thinking of entering and competing highly regulated domains. See the three canonical examples (health care, education and housing) where high prices and scarcity are the name of the game.
I think we're debating around the actual core of the issue: Regulations are only as good or bad as the content of the regulations, and corrupt governments can (and do) ignore and enact regulations at their pleasure.
Ideally, regulations can promote startups and overall market competition. We do see that ideal in some Australian regulations (and I would guess in most countries) but regulations are decided by the government, and that means that their enforcement (or lack thereof) and intent is often pro-incumbent.
I still maintain that regulations on political lobbying and donations would go a long way to open up the playing field for startups. Unfortunately, I don't see any evidence of any political party in any country doing more than pay lip service to actually doing this.