It's strange what puts a smile on your face these days.
Monopolies occur when a single controlling body has a way to control a single resource that is vital. (I'm not a sociologist nor an economist, so feel free to rip me a new one if I'm missing some important attribute of monopolies.) If that resource is available elsewhere, they no longer have a monopoly.
Business's holy grail is the monopoly, precisely because it requires less thinking and provides certain freedom. If you have a monopoly on it, you can do whatever you feel like to the customer -- charge them for your mistakes regularly and systematically, and they can do nothing but take it or go home.
Software is nearly impossible to monopolize, IMHO. Even assuming you put a patent on something, there's no reason that free enterprises cannot distribute it for no money, and they will. Somewhere out there is a person who, for whatever reason, wants to make the exact same thing for no money, just as a hobby.
While Microsoft rides high now, what will happen when there's a free drop-in replacement for each of its major products? Immediate, instant death. Each is slowly being replaced by one project or another.
So what happens when you can make diamonds indistinguishable from natural ones? That's right. Those assholes at DeBeers are going to go out of business. Hell, I hope they're chased by mobs and have to live on an island in the South Pacific or something. Goddamn artificial demand^Wrarity...! Down with DeBeers!
Re:Supply and demand
chaoticset on 2003-08-14T19:54:52
I'm being, eh...what's the word I'm looking for? Stupid, I guess.Based on the notion that rarity controls demand to some degree, and that DeBeers completely controls effective rarity because of their supply control, I feel it's easier to cut out the middleword and say that DeBeers controls demand. I realize it's not complete control, but I feel it's control nonetheless.
I suppose "artificial demand" is a poor phrase, though. Consider it fixed.
Re:Supply and demand
petdance on 2003-08-14T20:46:55
What you're calling "demand" is not demand from an economics point of view. It's "market price". Demand is strictly "the amount of a good that consumers are willing and able to buy at a given price."The supplier of a good can't control demand, only supply. I might be trying to sell my used Kleenex, and I can artificially limit supply (only selling one per day, even though I could sell at least ten per day), but that doesn't mean that there's more demand.
All that DeBeers is affecting by controlling supply is the intersection of supply & demand, which is market price.
Googling on "supply demand definition economics" turns up a number of good class notes from various educational institutions...
Re:Supply and demand
chaoticset on 2003-08-14T21:07:59
IANAE, so the definition of the word within that notion wasn't something I was aware of.Now that I've admitted my ignorance -- doesn't demand increase with rarity? I mean, commonsensically it would seem so, but perhaps this is one of those things that economists know better than I about. (Like, say, economic stuff.)
Re:Supply and demand
petdance on 2003-08-14T21:22:41
I'm no economist, either, but I did take a semester each of Microeconomics and Macroeconomics over the past two years. My understanding of "demand" matched yours exactly, and it took a while. If you look at some of the class notes pages, or any intro econ textbook, the graphs may help. I know they did for me.Re:Supply and demand
chaoticset on 2003-08-14T23:36:00
My advisor is interested in economics first, computer science second, so he pushed the economics classes big time when they were open for me one semester. I didn't take his advice -- he also recommended I take a class on COBOL....I did take a semester each of Microeconomics and Macroeconomics... I'll have to look it over. I'm curious what the formal definition of demand is, now...
:\ Re:Supply and demand
delegatrix on 2003-08-14T23:52:39
I would argue that tobacco companies create demand by selling an addictive product.
