Larry Summers has discovered "the new natural monopolies" -- where monopoly
profits are required to motivate investment. See his speech
in early May --
"The New Wealth of Nations"
Remarks by Treasury Secretary Lawrence H. Summers
Hambrecht & Quist Technology Conference
San Francisco, CA
Brad De Long wrote:
> Louis Proyect wrote:
>
> >
> >> The most interesting points were made around the question of innovation.
> >> Kotz makes a convincing case that competition such as the kind that exists
> >> in the Adam Smith model is HOSTILE to technical innovation. Capitalist
> >> firms would under-invest normally because their competitors can easily
> >> mimic the new improvements without undergoing the same expenditures. In
> >> reality, monopolistic firms are generally the ones that promote R&D,
> >> especially those that receive tax subsidies or have ties to the military.
> >> Bell Labs was a major innovator for many decades, but as soon as the phone
> >> companies were broken up, Bell Labs switched to market research from pure
> > > science or engineering.
> >
>
> Good point....
>
> Brad DeLong
