[PEN-L:6704] Re: Competitiveness

[Tavis Barr <tavis@xxxxxxxxxxxxxxxxxxxxxxxx>]

On Mon, 14 Oct 1996, Michael Perelman wrote:

> I do not have a precise definition of competitiveness.  I do have an
> understanding about what it means.  Most industries have low marginal
> and high fixed costs.  Under competitive conditions, they would lose
> money.  Profits, in effect, are a sign of weak competition.
>
> Is that the sort of answer that you wanted?

I guess so.  It just begs a lot of questions.  Essentially it defines
low-profit periods as high-competition periods and vice versa.  Okay,
but what has created this competition?  Is it because capitals are
finding that new markets don't exist so they go after existing ones?  Is
it, conversely, because firms are expanding their horizons to different
countries?  Is it because accumulation, and the need to invest
accumulated assets, has made new firms willing to enter at a lower profit
rate?  And, given any of these explanations, what is one to make of the
current profit boom?  And is any of these hypotheses in contradiction to
a pattern of increasing concentration?  Enquiring minds wanna know.


May the last bureaucrat be hung by the entrails of the last capitalist,
Tavis