Competition, Efficiency and Freedom vs Monopoly, Inefficiency and Slavery

Generally, when I have to go somewhere, I usually walk, and when I do that I try to enjoy a bit of the way and observe what the rest of the people do, however, as I move forward it is inevitable to lose the notion of reality and start thinking about an idea or a certain problem while I continue walking.

On this occasion, I began to measure the time it took to arrive at the shipping company, where I was going to pick up a package, in order to make the comparison with the time it took me to get to that same place by public transport, but in doing so, I It was inevitable to hurry the step with the aim of improving my personal brand. (Yes, a little compulsive all this)

When I arrived at the site I could see that it had taken less time than on previous occasions, obviously I had tried to accelerate my pace and thus cut the difference between the time it takes me to get there by bus and the time it takes me to walk.

However, I only did this because, on this occasion, I did not mind getting there faster, that is, I increased my pace just because I was competing against the speed of public transport.

Similarly, I usually try different shipping companies in order to check who brings the package in better time, less expensive, and in better conditions, if the company does not meet my expectations naturally try another, luckily this sector has enough options.

Well, the idea that began to hover in my head while I was returning to my house, was the idea that competition is the main motivating force to achieve efficiency, since efficiency understood as the ability to achieve the objective with the minimum of possible resources or in the shortest time possible, can only exist if there is something to compare it, that is, there can be no efficiency without competition.

Let me explain, if someone does an activity, and there is no sign that anyone else has done it, we can not say that that person is good at doing it unless another person tries to do the same, because only when another person tries, can we know, in first instance, if it is possible for another to do so too, and if the answer is affirmative, the comparison between one and another will tell us if the first one was correctly using the resources.

What's this all about? I practically wanted to talk about how modern society is affected economically and socially because the lack of competition eliminates efficiency and extends inefficiency throughout the social body.

In a system of full freedom, we know that monopolies and oligopolies could not be possible because in an environment of freedom, it is most likely that a situation arises in which competition between people seeking the same goal prevails, and cooperation between people who seek different objectives, which makes the competition even more maximized, and if it does, can't generate a monopoly, because a monopoly necessarily indicates inefficiency because without the comparison inherent in the competition, it is eliminate the incentives to increase performance, in such a way that inefficiency is generated.

I mean, all companies, all without exception, operate under the concept of homo-economicus, that is, try to achieve predetermined objectives as much as possible at the lowest possible cost, so for a monopoly will almost always be more beneficial to increase the price before increasing production, since one action requires effort and the other doesn't, therefore, the message that the market sends to a monopoly company that operates under the principles of capital, is always to save energy and increase the price of the product to the consumer, and in such a way generate more wealth and achieve efficiency. However, extrapolating this concept of efficiency to society in general produces the totally opposite result, because if the company that has a monopoly increases the price of the products, it means that the same product, in the same quantity supplied, is now more expensive for the rest of the community, which is why the efficiency of the monopoly becomes the inefficiency of the whole society that now needs to spend more resources to sustain that sector of the market. In other words, the sector of the economy that presents a market failure ends up charging its inefficiency to the rest of society.

From a communist/socialist worldview, the problem would be that the monopoly works according to capitalist principles, that thinks about money, however, that is not the problem, that a company pursues the financial benefit is what allows it to comply at the principe of economic calculation and look for efficiency. The real problem is that there is a monopoly, and that this inherently represents an inefficiency, which in turn represents a lack of freedom, because freedom generates competition and this in turn efficiency, consequently, whatever is obstructing freedom of the people is the problem, and in this case it is the State, because it is the only one that can deprive us of exercising our freedom in a legal way.

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