Comment Re:Disengenous (Score 1) 306
Why is it bad for efficient suppliers to replace inefficient suppliers? And why bad in the long run but not the short run?
The only thing which tends to make suppliers "efficient" in a "market" is competition.
Or at least the reasonable possibility of competition apearing.
If efficient suppliers replaced inefficient suppliers, but then in the long run inefficient suppliers returned to dominate the market,
It's more the other way around. Without effective competition suppliers who "dominate" a market will tend to become inefficient.
Not only is there the issue of "barrier to entry" there's also that of "ease of switching".
With the related issue of having to use a single supplier for all goods/services of type X. Since in a true "market" the customer is not tied to any supplier in the first place.
The only thing which tends to make suppliers "efficient" in a "market" is competition.
Or at least the reasonable possibility of competition apearing.
If efficient suppliers replaced inefficient suppliers, but then in the long run inefficient suppliers returned to dominate the market,
It's more the other way around. Without effective competition suppliers who "dominate" a market will tend to become inefficient.
Not only is there the issue of "barrier to entry" there's also that of "ease of switching".
With the related issue of having to use a single supplier for all goods/services of type X. Since in a true "market" the customer is not tied to any supplier in the first place.