Wednesday, January 30, 2019

the pervasive influence Big 5 and the potential role of anti-trust

The first in a five-part series on the influence of the "Big 5" tech giants.

The econ anti-trust / monopoly angle is interesting for many reasons. When should we invoke anti-trust? How well does anti-trust work in practice (vs. merely in theory)? Or broadening out: Why does govt do **so** much more to increase monopoly power than to reduce it? (Related, why do so many self-styled "pro-choice" and "liberal" folks prefer arrangements with artificially high monopoly power?)

Running with the first question, the usual complaint is from customers who react to high prices, low quality, etc. But in the context of the Big 5, the services are often "free", with price = 0. Of course, even when p = 0, they're still making ample revenues-- from ads, tie-in sales, etc.. So, one can still complain about $, but it's at least unusual in this context. The more pressing matter is "information" and what they're doing with it, ethically and practically.

Tyler Cowen and Matt Ridley are excellent on these topics, if you want to read/think more.


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