Corporations, Marketplaces, and Individuals

Silicon Valley’s favourite economist, Ronald Coase. Back in 1937, a young Coase wrote “The Nature of the Firm”, calling attention to something strange:

while corporations competed within a competitive marketplace, corporations themselves were not markets. They were hierarchies. If you work for a company, you don’t allocate your time to the highest bidder. You do what your boss tells you; she does what her boss tells her. A few companies dabble with internal marketplaces, but mostly they are islands of command-and-control surrounded by a sea of market transactions.

Think like a supermodel if you want to win from the gig economy, July 15, 2017 at 11:44PM

Tobacco industry’s 4 step plan to eliminate inconvenient facts

First, the industry appeared to engage, promising high-quality research into the issue. The public were assured that the best people were on the case.

The second stage was to complicate the question and sow doubt: lung cancer might have any number of causes, after all. And wasn’t lung cancer, not cigarettes, what really mattered?

Stage three was to undermine serious research and expertise. Autopsy reports would be dismissed as anecdotal, epidemiological work as merely statistical, and animal studies as irrelevant.

Finally came normalisation: the industry would point out that the tobacco-cancer story was stale news. Couldn’t journalists find something new and interesting to say?

The Problem With Facts, April 24, 2017, at 10:13 AM

Transparency & Price Fixing

Price transparency can in some settings facilitate tacit collusion by enabling firms to see what other firms are charging, and hence easily detect any deviation from agreed-upon high prices.

Policing the digital cartels, by David J Lynch in Financial Times Continue reading Transparency & Price Fixing

Big data & price fixing cartels

… as pricing systems become ever more autonomous, aspiring monopolists like Mr Topkins eventually will not even need to speak to their competitors to fix prices.

Computers will do the colluding for them, either by using the same algorithm or learning from their interactions with other machines — all without leaving behind trails of incriminating emails or voicemails.

Policing the digital cartels, by David J Lynch in Financial Times Continue reading Big data & price fixing cartels