rebelconservative Posted May 8, 2010 Report Share Posted May 8, 2010 How am I supposed to answer this question from a 3rd year economics course? ‘The best way to ensure that markets deliver an appropriate level of economic welfare is to prevent industries from becoming too concentrated and ensure strong competition.’ Discuss. I am thinking to address the false premises and inaccuracies in the question in the intro, then to try to answer the question as best I can that a free market actually achieves their goal best of all... but they just want you to parrot from their textbook so I don't know if I should bother fighting them. The textbook section actually starts so well: In March 2004, the European Commission found that Microsoft had abused its dominant position in the market for PC operating systems and ordered Microsoft to pay a fine of €497 million. What had Microsoft done to deserve such punishment? One of the issues was that Microsoft allegedly refused to supply timely information about its Windows operating system interface to some of its competitors in the server market. But why should Microsoft be forced to share information about its own technology? A second issue was the presence of Media Player within the Windows operating system. This made it hard for independent suppliers of products competing with Media Player to survive: since most customers had to purchase the Windows package anyway, they saw little point in spending more to get another music/video management application. But, should we really object when a firm offers an additional feature for free? Shouldn’t a firm be allowed to choose its commercial strategies? then just goes and spoils it all by saying something stupid like... the European Commission intervened in the Microsoft case not because it wanted to second guess Microsoft’s business acumen but because it feared that what might make commercial sense from the point of view of Microsoft might not be in the best interest of society as a whole. That is it. The State said "It is not good for society" so problem solved, there is no need for any further discussion apparently. It then goes into 38 pages about "market power," "monopoly," "barriers to entry," "anti-competitive behaviour" etc Quote Link to comment Share on other sites More sharing options...
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