Re: [OPE-L] Monopoly. Friendly reply to Jerry & Michael

From: Michael Perelman (michael@ECST.CSUCHICO.EDU)
Date: Wed May 09 2007 - 18:29:33 EDT

I really don't understand what you mean.  Under the old AT&T consumers had little 
freedom to choose; and when IBM labs were at their peak their customers were often 
locked in to IBM.

These companies faced little competition.

On Wed, May 09, 2007 at 08:01:44PM +0000, Alejandro Agafonow wrote:
> M. Perelman on 05/06/2007: Semi-monopolies, such as the old AT&T or IBM, had so much money that they could afford to do pure research, which would be profitable even if they would be able to appropriate only a small part of the benefits [Ö] This experience suggests the benefits of state supported research rather than oligopolies.
> The profitability Perelman refers to depends on two things: consumersí freedom to choose and the existence of competition or at least the absence of non-market barriers for potential competitors. If these conditions are not fulfilled we are not talking properly of a marketable good and if perhaps marketable in the future. Thatís why private firms avoid risking their capital unless they were sagacious enough to forecast the benefits. What we donít know is the quantity of unsuccessful prototypes in capital and State partnerships.
Michael Perelman
Economics Department
California State University
Chico, CA 95929

Tel. 530-898-5321
E-Mail michael at

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