Why the Marketplace Is Not a Zero-Sum Game

Twenty-twenty marks the twenty-fifth anniversary of a book that has had an expanding influence on the public conversation about market competition. Robert Frank and Philip Cook’s 1995 The Winner-Take-All Society argued that there are an increasing number of markets in which small differences in performance give rise to enormous differences in rewards. As John Kenneth Galbraith described it in a review of that book, the consequence is that “the one who wins gets it all.”

Since then, I have seen multiple articles that reflected the winner-take-all, “a few win at the expense of others” rhetoric as an accurate description of competitive markets, sometimes even accepting that its core claim was so well-established that it could be used as a scapegoat for an ever-expanding host of social problems.

However, even if technology has greatly increased the possible leverage or “amplification” of human talents (such as current worldwide markets for entertainers or large international businesses that multiply the economic impacts of superior corporate management), that leverage creates greater benefits for consumers, evidenced by consumers’ shifting of who and what they patronize toward what they consider better. Consequently, even if “star performer” incomes rise sharply compared to others, that doesn’t mean “the one who wins gets it all,” because that overlooks the far larger positive effects on consumers.

Συνέχεια ανάγνωσης εδώ

Πηγή: mises.org