Superphysics
Free Competition
4 minutes • 762 words
Table of contents
Free competition is a necessary idea under the Third Law or the law of fair exchange, and is always checked by the Fourth Law or the law of balance.
Value is spread throughout society via exchange after passionate creators make their products and services. Their mutual exchange naturally creates a sort of competition on who can satisfy the demand of society better, faster, and cheaper.
In time, the invisible hand, which also works on the demand side as the customer preferences, match both supply and demand.
Competition as a Beauty Contest
The freedom of each competitor needs to be guaranteed by the government.
For example, the competitors in a beauty contest might not be equal in height, weight, skin color, or hair length, etc. Nevertheless, their freedom to be in the competition, to wear their costumes, show their skills, answer questions, should be guaranteed by the organizers.
This guarantee of freedom in commercial competition was removed by French economist JB Say through the concept of laissez faire from the Physiocrats which he corrupted to mean total deregulation. Because of this deregulation, some competitors were able to acquire its competitors, corner the supply, and become too-big-to-fail.
It would be like a beauty contest where the organizers allowed some contestants answer questions longer than what is regulated. Or letting everyone have as many costumes as they want, instead of a single costume, as what is customary. This would benefit those from richer countries who could spend more for such costumes and thus bend the votes towards their favor.
The need for equal competitors was then created by the marginal revolution because it instituted the absurd concept of profit maximization.
Proof of this contradiction is in Marshall’s Principles of Economics (the textbook that came before Samuelson’s Economics)
It is commonly said that the tendency of competition is to equalize the earnings of people engaged in the same trade; but this statement requires to be interpreted carefully.
For competition tends to make the earnings got by two individuals of unequal efficiency in any given time, say, a day or a year, not equal, but unequal; and, in like manner, it tends not to equalize, but to render unequal the average weekly wages in two districts in which the average standards of efficiency are unequal.
Then the quotes are mostly found in Book 5
