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Re: [free markets, competition, and monopolies]



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It is a good point Vamsi has raised. It is important to agree on the
definitions of the terms we are using. Perhaps IPI can host a glossary of
terms and the agred upon definition. 

Here is my interpretation of a free market. A free market is an economic
configuration where (subject to legal and moral constraints) anyone is free to
carry out trade with anyone else. Here "anyone" may refer  either to
individuals or to organizations. 

In a free market, not only is the customer the king, but every player has an
equal (or comparable) opportunity to become the customer. Note that equal
"opportunity" is not the same as equal status or equal wealth. 

My definition of free market is not favourable towards monopolies. Customer
should have the choice and it is customer's choice that selects the winner.
However, this is under the constraint that every player can have an equal
opportunity to be a customer. A system that is free-for-all is NOT a free
market -- it would eventually settle down to either an oligarchy or an anarchy
(a solely capital driven system) while a free market is something that
epitomizes free trade (demand driven). 

Best Regards, 
Srinath 


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