This Note argues that the current framework in antitrust—specifically its pegging competition to “consumer welfare,” defined as short-term price effects—is unequipped to capture the architecture of market power in the modern economy. We cannot cognize the potential harms to competition posed by Amazon’s dominance if we measure competition primarily through price and output. Specifically, current doctrine underappreciates the risk of predatory pricing and how integration across distinct business lines may prove anticompetitive. These concerns are heightened in the context of online platforms for two reasons. First, the economics of platform markets create incentives for a company to pursue growth over profits, a strategy that investors have rewarded. Under these conditions, predatory pricing becomes highly rational—even as existing doctrine treats it as irrational and therefore implausible. Second, because online platforms serve as critical intermediaries, integrating across business lines positions these platforms to control the essential infrastructure on which their rivals depend. This dual role also enables a platform to exploit information collected on companies using its services to undermine them as competitors.
India is nearly done building the plumbing to enable such a system by connecting the Aadhaar-based biometric ID system to individual bank accounts. It’s already replaced LPG gas canister subsidies with cash, a program that has 150 million beneficiaries and is the now the world’s largest cash transfer program. So could India take this example to its logical conclusion and replace all welfare benefits with UBI? (GiveDirectly is asking a similar question in a bold 10-year $30 million experiment in Kenya.)
The Survey’s assessment begins with quotes from Mahatma Gandhi suggesting both support and objection to the principles of UBI. The chapter then methodically addresses the conceptual pros (e.g., justice, equity, agency, efficiency) and potential cons (e.g., labor disincentives, moral hazard, political objections). It attempts various modeling, including a rough estimate that cutting national poverty in half via UBI would cost just 1.5 percent of GDP, less than the subsidy bill in the 2016-17 budget. For the data nerds, there are seven (!) appendices explaining all the estimates and calculations. Continue reading
Here is a typical example. Minority President Trump has said that he intends to get rid of 75% of government regulations. What is a “regulation”?
The term “regulation” is framed from the viewpoint of corporations and other businesses. From their viewpoint, “regulations” are limitations on their freedom to do whatever they want no matter who it harms. But from the public’s viewpoint, a regulation is a protection against harm done by unscrupulous corporations seeking to maximize profit at the cost of harm to the public. Continue reading
By “liberalism” I mean what is considered under this term in the US. By “to blame” I mean “for the rise of Trump and similar nationalist-populists”.
What are the arguments for seeing liberal triumphalism which began with the collapse of Communism in the 1990s as having produced the backlash we are witnessing today? I think they can be divided into three parts: economics, personal integrity, and ideology.
The Resolution Foundation’s study found that the current parliament would be the worst for living standards for the poorest half of households since comparable records began in the mid-1960s and the worst since the early years of Thatcher’s 1979-90 premiership for inequality.
Note that the level of manufacturing employment, while it has cyclical ups and downs, is nearly constant from 1970 to 2000 at around 17 million. It plunged in the early years of the last decade as the trade deficit exploded. Most of the fall in employment was before the collapse of the housing bubble in 2008. This is what happens when a trade deficit increases from around 1.5 percent of GDP, the mid-1990s level, to almost 6.0 percent of GDP at its peak in 2005-2006 (over $1.1 trillion in today’s economy).
In his article Brad does a bit of slight of hand on this rise in the trade deficit, attributing it to an over-valued dollar rather than trade agreements like NAFTA. I agree with him on this, but I think the ignorant masses can be excused for failing to recognize that the jobs lost to trade were due to the Clinton administration’s dollar policy rather than its trade deals.
PROJECT 2018 Poor People’s Call to Action – Dr. King’s work re-envisioned fifty years on
Next April 2018 will mark the 50th anniversary of the assassination of Dr. Martin Luther King. His ‘last great exertion’ in 1967/68 was The Poor People’s Campaign – a march on Washington DC that was a more radical effort than 1963. Its aim was to get racial and economic justice for all poor Americans. He was becoming an ever greater threat to anti-progressive forces as he realised that, in addition to race, class was becoming an equally critical part of the struggle. At what was to become the end of his life, he was now mobilising black and white Americans.
At the heart of this campaign was an Economic Bill of Rights, addressing employment, health, education, land, finance and participatory government. Today in the USA, there is a renewed push to mark and re-envision the Poor People’s Campaign.
We think the time is right to build on those USA efforts and today we launch a new project to ‘internationalise’ Dr. King’s Poor People’s Campaign and place a renewed vision for the Economic Bill of Rights at its heart.