Thursday, May 22, 2008

When you stop to think about it, capitalism really is an amazing thing. Corporations exist to provide a service while making a profit, of course, but it's often a tricky task to keep the balance right. Capitalism does that by encouraging competition.

When a corporation is profitable, competitors will spring up, and that competition naturally lowers prices. When one retailer sells a widget for a dollar, his neighbor will set the price at a few cents lower to bring the smart customer in.

In this way, the economist Adam Smith's "invisible hand" ensures that, without any government interference, the customer gets a great deal while the corporation's greed is kept in check.

Well, or the manufacturer tells the stores what to charge, and the stores all say, "Fuck the customers! Either they'll buy the thing or they won't."

2 comments:

David said...

Why do you hate America?

RomanHans said...

David, I hate everything -- from junk food to cellphones to reciprocal sex. We, the unwashed masses, need to stand up and take action against a patriarchical oligarchy where you can't get in shape for less than $89.99.

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