Except for the fact that the colluding firms are also going to collude to keep out competition. In many places that means upstarts get their throats cut before they can open their new competing business.

Go to many places in the third world and try to compete with the local business. I wont send flowers to your funeral.

Just because you believe you know something doesn’t mean you actually do. Your writing is simply asinine.

To review: for his statement to be correct, here are the required assumptions, all of which MUST hold:

* Many small firms, each of whom produces an insignificant percentage of total market output and thus exercises no control over the ruling market price.

* Many individual buyers, none of whom has any control over the market price – i.e. there is no monopsony power

* Perfect freedom of entry and exit from the industry. Firms face no sunk costs – entry and exit from the market is feasible in the long run. This assumption ensures all firms make normal profits in the long run.

* Homogeneous products are supplied to the markets that are perfect substitutes. This leads to each firms being passive “price takers” and facing a perfectly elastic demand curve for their product

* Perfect knowledge – consumers have readily available information about prices and products from competing suppliers and can access this at zero cost – in other words, there are few transactions costs involved in searching for the required information about prices

* No externalities arising from production and/or consumption which lie outside the market

People who’ve taken only econ 101 are even worse than people who’ve taken no economics at all because they actually think they know what they are talking about. I could go on and on about how the airline industry violates almost every single one of those assumptions.

That’s right! If I beat you up for your lunch money and take it YOU WIN because in the future someone might add security that will forbid the taking of lunch money!

Because if you did, you would know that profits are what attract competition. So even if two, three or four firms colluded in some way that drove prices up past their normal market level, the consumer would ultimately win due to the market entrance of others eager to capture these economics.

I think everyone on the page would do well to be a little less emotional, and more measured in commenting on these things.

But he’s got the rest backwards.

But does your Taco Bell feature random gang violence for diners’ entertainment?
If they’re going to specialize in “randomness” , they should do it up right! IMHO

Men of the Trapezoidal Table: We can’t afford to compete with the Lousy Cheating Evil Gas Kingdom’s connections with Certain 3rd World countries, that are allowing them to undercut our prices at the pump! BUT we can bribe a few Senators in the Flyover States to enact legislation that will allow us to adulterate gas with up to 25% corn squeezin’s, made from cheap govt. surplus corn! INNOVATION, INNOVATION, INNOVATION! (Sort of.)

This guy has clearly never run a retail operation before. Or a wholesale operation. Or any sort of daily business, I’d guess.–jnfr

Welcome to the world of the Ivory Tower/Think Tank Economic Evangelists. They’re the people who engineered the “soft landing.”

Executive summary: TCS was founded by James K. Glassman, a fellow of the AEI who was recently appointed by Bush as chair of the Broadcasting Board of Governors (essentially, the folks in charge of broadcasting pro-US propaganda overseas–they oversee Voice of America, Radio Free Europe, etc.) TCS used to be owned by the DCI Group, a Republican lobbying company, but they recently sold it to its editor-in-chief Nick Schulz, who prior to joining TCS worked for Fox News. In short, TCS is and always has been a creature of the Wingnut Web.

The dread Krugman has stirred in the deep, and issued forth a foul and pestilent blog.

http://krugman.blogs.nytimes.com

Short answer: Yes. TCS has been around for a while, and the letters used to stand for “TechCentralStation” instead of whatever they do now, and maybe, possibly, at one point in their history they were an actual techie news site, but for as long as I’ve been aware of their existence, they’ve been just another WingNutDaily.

The Riot Grill

See, the thing is, Sidhe’s right – all the food is exactly the same. What they offer is different textures instead of flavors. In many taco bells, you can order “Two crunchy, one chewy, one soft and a soda”. Somehow, I think that’s pretty cool….

mikey

I got stuck in the Las Vegas airport once, and the airline gave us coupons for food. Somehow, the least bad choice seemed to be Taco Bell. That was the last time I ever went to Taco Bell, I think it has to be the worst fast food evuh!

P.S. That was back in the 90s.

http://www.time.com/time/printout/0,8816,953755,00.html

And the reason airline execs wanted to keep their industry regulated in the ’70s was due to the very anticompetitive nature of those regulations.They were not designed to protect consumers.The cost of air travel today adjusted for inflation is way lower than in the regulated era. So are airline wages but I guess that’s the silver lining for fuckwit libertarians and republicans.