Barriers to entry alert: do late entrants have a chance
22 Sep 2014 Leave a comment
in applied price theory, Austrian economics, economic history, entrepreneurship, industrial organisation, liberalism, technological progress Tags: Austrian economics, barriers to entry, creative destruction, Israel Kirzner, market process
September 21, 1999 – Google came out of beta; the 17th search engine to officially enter the market.
Kirzner defines a competitive market as a market where no potential participant faces non-market obstacles to entry:
Following a long tradition in economics going back at least to Adam Smith, Austrians define a competitive market not as a situation where no participant or potential participant has the power to make any difference, but as a market where no potential participant faces nonmarket obstacles to entry.
(The adjective “nonmarket” refers, primarily, to government obstacles to entry; it is used to differentiate such obstacles from, for example, high production costs that might discourage entry. These latter do not constitute noncompetitive elements in a market; to be able to enter means to be able to enter a market if one judges such entry to be economically promising-it does not mean to be able to enter without having to bear the relevant costs of production.) That is, a situation is competitive if no incumbent participant possesses privileges that protect him against the possible entry of new competitors.
The achievements that free markets are able to attain depend, in the Austrian view, on freedom of entry, that is, on the absence of privilege.
Timeless Tips for ‘Simple Sabotage’ — Central Intelligence Agency
21 Sep 2014 Leave a comment
in applied price theory, entrepreneurship, industrial organisation, organisational economics, personnel economics, war and peace Tags: sabotage
Managerial Econ: Why are wages decreasing and employment increasing in Great Britain?
19 Sep 2014 1 Comment
in applied price theory, labour economics, labour supply, welfare reform Tags: British economy, wage flexibility, welfare reform
The simplest explanation is that supply is increasing: as supply increases output increases real prices fall and output increases.
The Financial Times shows the data and puts forward several explanations:
(1) welfare reforms are pushing people off the dole and into the labor force;
(2) older workers are choosing to retire at a later age.
Both explanations would imply an increase in supply.
via Managerial Econ: Why are wages decreasing and employment increasing in Great Britain?.
Climate Consensus: Do Little for Now
16 Sep 2014 1 Comment
in applied price theory, applied welfare economics, economics of natural disasters, environmental economics, global warming, health economics, liberalism, technological progress Tags: climate alarmism, cost benefit analysis, global warming, moral panic, richer is safer, wealthier is healthier
What does socialism do?
15 Sep 2014 1 Comment
in applied price theory, applied welfare economics, comparative institutional analysis, development economics, growth disasters, liberalism, Marxist economics Tags: socialism
HT: Dan Mitchell
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