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Stiglitz: Monopoly's New Era

If Americans abandoned the role of the worlds police, how would that effect their economy? And would the obvious direct benefits of that, outweigh the unforeseen consequences?

That is a role the US assumed willingly. Nobody asked the US to do so. The US took on the role of "Defender of Europe" after the defeat of the Nazis, since Europe was devastated and had to be rebuilt. It then continued in that role, until the Soviet Communist regime toppled.

Due to that historical role, Total US military expenditure is 2.3 times as much as the EU. Whilst US Health Care comparatively is 1.8 times as much, but for a population that is only 63% of the EU.

A comparison (% of GDP):
Defense
*EU - 1.5%
*US - 3.5% (2.3 times as much)
Health Care
*EU - 9.7%
*US - 17.1% (1.8 times as much)

Meaning what? Maybe this:
*The US spends 2.3 times more on DoD. But, it's Defense scope-of-responsibility is much larger than the EU's.
*The EU spends less budget-percentagewise on Health Care but on a population size that is 57% larger.

The US polices the world, and the EU doctors its people. The EU population is getting the better bargain?

Anyway, clearly, "very different strokes for very different folks" ...
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Wrong name. Try "Google" ...

Microsoft is "IE"! Microsoft employed its monopoly in PCs to dominate the Browser Wars initially.

From WikiP, excerpt:

And,


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I know that. That is why I mentioned that we had started with Microsoft's monopoly. But this is going no place. Let's call it a day.
 
Meaning what? Maybe this:
*The US spends 2.3 times more on DoD. But, it's Defense scope-of-responsibility is much larger than the EU's.
*The EU spends less budget-percentagewise on Health Care but on a population size that is 57% larger.

The US polices the world, and the EU doctors its people. The EU population is getting the better bargain?

Anyway, clearly, "very different strokes for very different folks" ...
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you have to factor in what the American economy would look like without the worlds largest military, hypothetically if america halted all mlitary spending then russia would become the worlds sole military, which means russia would be the safest place to invest your money, meaning more people would begin buying russian debt instead of american, they would begin trading oil using rubles instead of dollars. What would the price of oil be? the price of milk? the US credit rating, the interest on their debt? theres alot more involved then just deciding to spend money on "books instead of bombs"

Western Europe is not a military power, it can only hold onto some power through groups like the EU, the eurozone, nato etc etc. So their fate would be based on russian (instead of american) political favor, which might be far less. The UK or France couldn't maintain a worlds police force, like the USA. So if america halted its military spending altogether, they would not only lose their military protection, but they would lose american financial support.

again this all hypothetical, because the USA will never decrease its military spending
 
and what would be the most obvious example of this monopoly of 3,4, or 5 competitors with no competition??????????????

The number is not important, it is the concentration obsrved resulting in "sticky-pricing"; which resulting from no real-competition amongst the market participants.

Whereupon, collaboration/collusion over market-pricing can be proven; which is often very difficult if not legally impossible.
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The number is not important, it is the concentration obsrved resulting in "sticky-pricing"; which resulting from no real-competition amongst the market participants.

Whereupon, collaboration/collusion over market-pricing can be proven; which is often very difficult if not legally impossible.
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wouldn't that be considered an oligopoly rather than a monopoly?
 
wouldn't that be considered an oligopoly rather than a monopoly?

Functionally it may indeed be an oligopoly if more than two market actors exist. But when "sticky-pricing" occurs willingly, they are employing "monopoly pricing" since they are acting uniformly as "one". (Not that that distinction makes much of a difference in a court of law.)

The leading firm or firms (in terms of market-share) set the price and all the others follow. There is no "real competition". But is the sticky-pricing due to volitional fixing of prices, or other market forces? For instance, from Investopedia:

BREAKING DOWN 'Price Stickiness'
The fact that price stickiness exists can be attributed to several different forces, such as the costs to update pricing, including changes to marketing materials that must be made when prices do change. Part of price stickiness is also attributed to imperfect information in the markets, or non-rational decision-making by company executives. Some firms will try to keep prices constant as a business strategy, even though it is not sustainable based on material costs, labor, etc.

Legally "price fixing" must be proven clearly intentional for it to be punishable by law ...
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Google and Microsoft are examples of Market Dominance in HiTech. Both got very rich from price-gouging, or, if you like, perfectly legal price-fixing. For which the European authorities have just indicted Google. We'll see what happens in Europe, if Uncle Sam is too much of a market-overseer milquetoast to do his duty in the US. (And I cannot imagine why Bing is not doing better; it's a damn fine search-mechanism.)

However, in fact I was thinking of some more traditional markets that are heavily consolidated, more humdrum: US HealthCare, Banking, and Insurance. Some others with the same trends (from here, excerpted):


Aside from stock-market valuations, is the American public better off from too much consolidation ... ?

too much?? we now face huge international competition in all industries so consolidation is the last worry we face. Do you understand?
 
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