[EMAIL PROTECTED] wrote:
(snip of most of the post)
> My mentor in economics, Vernon Fowke, wrote many times in
> his numerous articles on the agricultural economy that "there are
> no (long term) profits in competition" (despite the risks.) Anyone
> who has had much practical experience with agriculture will, I think
> agree except for the possibility of recieving surplus income
> generated by Ricardian rent (based on lower than average costs) or
> on government subsidy programs.
>
> Paul Phillips,
> Economics,
> University of Manitoba
Paul, could you give me a cite or two for Vernon Fowke? I'M trying to use this
condition of agriculture as part of my argument about electric power. I think
anybody selling an undifferentiated commodity -- like a farmer -- either gets no
profits or colludes with others to fix prices so that there will be profits.
Kilowatt hours are, by themselves, undifferentiated commodities, so there will be no
profits unless the producers collude or hang a logo on the electrons. The latter
will be attempted, of course, and anyone succeeding will be praised for "adding
value."
I dond't think economists pay enough attention to the lack of profits in
commodities. Even computer disk drives have reached the commodity level and the
shake-out is on. Of course mergers and collusions fix the problem. Is collusion
necessary for profits? It clearly is, in many industries.
Gene Coyle
