Peter wrote:
>Sam Insull, if I remember correctly, is the tycoon who paid a group of
>economists to develop the theory of "natural monopoly". It justified the
>enforced monopoly status of the electrical utilities.
but didn't Adam Smith have a theory of "natural monopoly"?
I'm not rejecting the idea that capitalists sponsor economic theories
though. I believe it was the BELL JOURNAL OF ECONOMICS (Bell as in AT&T,
back when AT&T had a monopoly) that pushed the theory that it was
inefficient if small firms are allowed to "cream skim," to take those
aspects of a natural monopoly's operations which don't have to be
monopolistic to be profitable. It's an obviously self-serving theory, but
it also makes a valid point. For example, United Parcel Service and Federal
Express have cream skimmed from the U.S. Postal Service, leaving it with
the unprofitable first class-mail service.
Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine
