X-Spam-Status: No, score=-2.6 required=5.0 tests=BAYES_00 autolearn=unavailable version=3.2.2 Sender: -2.6 (spamval) -- NONE Return-Path: Received: from newman.eecs.umich.edu (newman.eecs.umich.edu [141.213.4.11]) by boston.eecs.umich.edu (8.12.10/8.13.0) with ESMTP id l89Njoux031160 (version=TLSv1/SSLv3 cipher=DHE-RSA-AES256-SHA bits=256 verify=FAIL) for ; Sun, 9 Sep 2007 19:45:50 -0400 Received: from galaxyquest.mr.itd.umich.edu (mx.umich.edu [141.211.176.134]) by newman.eecs.umich.edu (8.14.1/8.14.1) with ESMTP id l89NjKIc013458; Sun, 9 Sep 2007 19:45:20 -0400 Received: FROM newman.eecs.umich.edu (newman.eecs.umich.edu [141.213.4.11]) BY galaxyquest.mr.itd.umich.edu ID 46E485A0.79BDA.17220 ; 9 Sep 2007 19:45:36 -0400 Received: from oshkosh.eecs.umich.edu (oshkosh.eecs.umich.edu [141.212.113.86]) by newman.eecs.umich.edu (8.14.1/8.14.1) with ESMTP id l89Nj7Ra013414 (version=TLSv1/SSLv3 cipher=DHE-RSA-AES256-SHA bits=256 verify=NO); Sun, 9 Sep 2007 19:45:07 -0400 Received: from oshkosh.eecs.umich.edu (localhost.eecs.umich.edu [127.0.0.1]) by oshkosh.eecs.umich.edu (8.13.8/8.13.0) with ESMTP id l89NjUJv011450; Sun, 9 Sep 2007 19:45:30 -0400 Received: from localhost (klochner Æ localhost) by oshkosh.eecs.umich.edu (8.13.8/8.13.8/Submit) with ESMTP id l89NjT18011447; Sun, 9 Sep 2007 19:45:30 -0400 In-Reply-To: Message-ID: References: MIME-Version: 1.0 Content-Type: TEXT/PLAIN; charset=US-ASCII; format=flowed X-Spam-Checker-Version: SpamAssassin 3.2.2 (2007-07-23) on newman.eecs.umich.edu X-Virus-Scanned: ClamAV version 0.91.2, clamav-milter version 0.91.2 on newman.eecs.umich.edu X-Virus-Scanned: ClamAV version 0.91.2, clamav-milter version 0.91.2 on newman.eecs.umich.edu X-Virus-Status: Clean Date: Sun, 9 Sep 2007 19:45:29 -0400 (EDT) To: James W Mickens cc: Daniel Reeves , improvetheworld Æ umich.edu From: Kevin Lochner Subject: Re: mind the gap I'd like to chime in for just a second on this one. The fact that companies prefer to represent some of their data in a pie chart doesn't automatically validate the daddy model, you're going to have to work a little harder than that: company A builds 90 widgets company B builds 90 widgets the total "market" for widgets is 100. Both comapanies have still created wealth of 90 widgets, they're just going to have to reduce their prices for widgets in order to sell their inventories. Widgets have now become cheaper because of the extra "widget wealth" that has been created. Pie charts are only reflecting the fact that companies restrict production to maximize prices. - k On Sun, 9 Sep 2007, James W Mickens wrote: >> James, I think you're empirically wrong that wealth creation is anything >> like a zero-sum game and I'm working on my response! > > I think that the basic laws of economics are against you here. Trixie's > example of market share is a good one. Given a finite number of people > willing to pay for a service, the wealth acquisition of one service provider > is often in direct opposition to that of another. Even if the customer base > is growing, there's no guarantee that there's enough demand for multiple > businesses to run at their full profit capacity at a given moment. There's > certainly not enough room for multiple businesses to expand at arbitrarily > large rates forever. Once the customer base for widgets reaches its > saturation size, consumers will buy widgets from someone who is you, or > someone who is not you. If they buy from you, this increases your wealth > while decreasing that of your competitors, and vice versa. I don't think that > this is a radical idea. CEOs talk about stealing market share from other > businesses all the time. Are they fundamentally confused about how businesses > work? > > ~j >