The so called "free market" (not to be confused with laissez faire) assumes perfect "information symmetry" and perfectly rational market participants, which is, effectively, impossible in this particular reality, and concerns itself mostly with marginal eventual state. It is a model.
E.g. the model "use VC money to subsidize cost until all competitors are bankrupt then hike prices to recoup" is not really reflected in this "free market"
> use VC money to subsidize cost until all competitors are bankrupt then hike prices to recoup
Can you give some examples of this happening in real life?
None of the examples I can think of where people criticised the companies for operating unprofitably, such as Amazon retail or Uber, were able to corner their markets.
Harvey Normans, Targets, Argos's, Walmarts, all still exist and compete with Amazon retail. Most towns still operate normal taxis services, Lyft, FreeNow, Bolt, all compete with Uber.
VC funding subsidising pricing, albeit temporarily, is still good for consumers. It doesn't seem to imply higher eventual prices. The opposite seems true, in fact.
Yes, there is nothing wrong with working hard and making money. But if you use that money against the rest of us, then we have a problem. Making a huge pile of money to corner a market is one of those scenarios, but there are many.
friendzis|4 months ago
E.g. the model "use VC money to subsidize cost until all competitors are bankrupt then hike prices to recoup" is not really reflected in this "free market"
Fernicia|4 months ago
Can you give some examples of this happening in real life?
None of the examples I can think of where people criticised the companies for operating unprofitably, such as Amazon retail or Uber, were able to corner their markets.
Harvey Normans, Targets, Argos's, Walmarts, all still exist and compete with Amazon retail. Most towns still operate normal taxis services, Lyft, FreeNow, Bolt, all compete with Uber.
VC funding subsidising pricing, albeit temporarily, is still good for consumers. It doesn't seem to imply higher eventual prices. The opposite seems true, in fact.
amelius|4 months ago