Monday, April 18, 2016

Mark Thoma — Paul Krugman: Robber Baron Recessions


Krugman on monopoly power.

Finally, some economists are waking up to the fact that it's the rent, stupid, and that economic rent flows from economic power that is based on political power.

Economist’s View
Paul Krugman: Robber Baron Recessions
Mark Thoma | Professor of Economics, University of Oregon

5 comments:

Matt Franko said...

But Tom the rent is embedded in PRICE... its a component of PRICE...

So MMT (often but not always) says "its about price NOT quantity..."

So Krugman doesnt really understand HOW the rent influences things as he is still stuck on quantity type analysis via the academe of economics...

PRICE is a paramount variable involved in the current regulated numismatic system...

Similar to "concentration" in an osmotic system...

https://quizlet.com/53190626/3-types-of-osmotic-solutions-flash-cards/

Tom Hickey said...

Economic rent is the component of price in excess of the market price in a perfect market. Monopoly rent is based on artificial scarcity due to market imperfection. That is the result of market power. Large firms that control markets avoid market saturation. There is no reason for them to increase quantity and reduce price since there is lack of competition to force it and higher profits can be gained by extracting rent.

Matt Franko said...

" And only one party seems bothered by either of those observations."

These economist people are moron politicians NOT scientists... NOOOOOOO THANKS!

Ignacio said...

I can't take Krugman seriously, he is just part of the Democratic party elite, ie. a total elitist idiot.

Simsalablunder said...

Krugman has just stuck his wet finger up in the air. That's his method to appear relevant.