Monopolies

Monopoli berasal dari ekonomi kapitalis dengan pandangan hidup liberalnya, banyak ditentang oleh masyarakat. Sebab monopoli ternyata membawa dampak negative  bagi kompetisi pasar yang sehat. Pada pasar monopolis produsen-produsen lain tidak akan dapat bertahan,bahkan yang lebih buruk produktifitas dengan sengaja diturunkan demi tujuan politis, yaitu mengatur harga agar maksimal. Maka dengan sendirinya akan terjadi kelangkaan akan barang (scarcity) dan dampaknya akan sangat dirasakan oleh masyarakat (konsumen). Islam dengan sistem ekonominya mencoba untuk mementahkan ideologi monopolistik ini.

“Robert F. Stockton and Monopoly Politics” is about the least known, but most-influential person in nineteenth century New Jersey politics. Commodore Robert F. Stockton was the grandson of Richard Stockton, the only signer of the Declaration of Independence to recant his support for the American Revolution after he was capture and imprisoned by the British in 1781. Robert Stockton attended the College of New Jersey (Princeton University, today) and served as a midshipman in the U.S. Navy during the War of 1812, where he participated in the defense of Baltimore and Alexandria, Virginia and as a Lieutenant under Commodore Stephen Decatur in the war against the Barbary pirates in North Africa. In 1821 he was ordered by President James Monroe to accompany Dr. Eli Ayres, an agent for the American Colonization Society to the west coast of Africa. In this capacity he forced the local tribal leader named “King” Peter at Cape Mesurado to cede what became the country of Liberia to the ACS. Like other leaders of the ACS, including James Madison, Henry Clay, and Frances Scott Key, Stockton believed that free blacks had to be sent back to Africa to convert the natives there to Christianity. The irony was that King Peter was involved in the slave trade, which Stockton and the ACS opposed. Stockton also was opposed to flogging in the navy.

Upon returning to New Jersey, Stockton became involved in politics and business during the period of what has become known as “internal improvements.” On the national level there was a debate between Henry Clay who wanted the federal government to finance roads and canals and supported the re-chartering of the Second Bank of the United States and the supporters of Andrew Jackson who argued that there was no such power provided in the Constitution and opposed the national bank as a monopoly. This difference in political philosophy was the basis for the second American party system: the Jacksonian Democrats and the Whigs (so-named because of their opposition to the man they called “King Andrew”). A look at Stockton and the politics on the state level, however, adds a new perspective to what has been called “Jacksonian democracy.” Stockton was a Jacksonian Democrat, but he was an investor in a state-granted transportation monopoly.  He became the president of the Delaware and Raritan Canal Company chartered by the State of New Jersey in February 1830 on the same day that the state also chartered the Camden and Amboy Railroad proposed by the Stevens family of Hoboken. The railroad stock was bought up quickly, but the canal stock didn’t not sell. Stockton then proposed that the railroad and the canal companies be merged into the so-called “Joint Companies” charted in February 1831 with a monopoly on transportation between New York and Philadelphia. Stockton became the president of the Joint Companies. Although Stockton was a Democratic, he split with President Jackson during the so-called Bank War, because Nicholas Biddle, the president of the Second Bank of the United States, provided financial support to the Joint Companies. On the issue of monopolies, the Jacksonian Democrats on the national level opposed them, but on the state level they were the main supporters of monopoly.

Here I examine Jeremy Bentham’s arguments in favour of patents in light of his description of the five harms associated with monopolies. I find while these harms can be reduced by the limited duration and specific definition of patents, the existence of these harms means that a utilitarian (like Bentham) would have to support an alternative to patents if it produced the same positive results without the monopoly harms.

RESUME-Les politiques publiques environnementales souffrent des effets néfastes d’une entente tacite entre élites politiques et élites économiques. Indépendamment des références philosophico-politiques, une caste oligarchique politico-économique internationale gère, de manière substantiellement unitaire et tendanciellement autocratique, les affaires environnementales selon le modèle du développement durable, matérialisation d’une perspective utilitariste, anthropocentrique et ressourciste qui, essentiellement, considère que la biodiversité n’est rien d’autre qu’une réserve de ressources naturelles à la disposition de l’humanité. Désormais, une double transition éthique et politique est nécessaire pour préserver l’intégrité des systèmes naturels et pour soutenir le développement des sociétés humaines.

ABSTRACT-Environmental public policies are suffering the harmful effects of a tacit agreement between political and economical elites. Heedless of philosophical-political references, an international politico-economical oligarchic caste is largely united around dealing with environmental issues based on the sustainable development model, which is an expression of a utilitarian, anthropocentric perspective. Moreover, for this model biodiversity is in the main merely a reservoir of natural resources for human use. A dual transition – both ethical and political – is thus urgently needed to preserve the integrity of natural systems and support the development of truly human societies.

The objective of our paper is to depict which creative strategies buyers can develop to by-pass oligopolies more efficiently and to identify ways of monitoring the results. Methodologically speaking we have analyzed the way of operating of monopolies and the potential strategies developed by buyers to improve on their position by a sectorial analysis of the plastic pellet (resin) industry. We consider this industry to be a representative case for the above mentioned environmental situation.

The most important observation we made on how oligopolies operate is that from the outside they appear to operate as one single group offering nearly identical prices in one region. In reality however the different companies and their entities are separated from one another by an “intercompany Chinese wall”, called “profit and loss statement responsibility” Each company is indeed individually accountable for their sales, margins and profits. In general, the coordination is achieved by some type of marketing, but coordination on the level of pricing policy appears to be limited. So, if a price for Europe for instance is about x €, it might well be that the Asian price for the same product is much less, because oligopolists just like any other marketeers have to adapt their pricing to local circumstances. As such, one of the major worries oligopolistic suppliers face is to avoid parallel imports by traders. Additionally, local subsidiaries or joint-ventures will be prohibited to sell to other geographical areas. Oligopolists follow a simple add-up price calculation approach to achieve this goal. In order to avoid products and prices from their Asian subsidiaries and colleagues to enter the European market via parallel import, a comparison is made between the price of the most expensive European offer with the cheapest product from outside Europe. As long as the price delta does not exceed the sum of a number of costs linked to importing from outside Europe to Europe (conversion of local currency or $ into €, transportation costs (some times even back an forth), import duties eventually applicable and the standard margin of traders organizing these parallel imports), the parallel import problem is avoided.
The thing is that apart from an indication about the general pricing policy defined by the marketing department or the general management, most sales people are not informed about the sales prices of their colleagues and competitors in other geographical area’s. Moreover traders do not necessarily negotiate good logistical contracts as they focus more on buying prices than on other costs. These facts represent the Achilles heels of the way oligopolistic markets operate. Buyers can take advantage of these vulnerabilities to by-pass the negative consequences linked to the bottleneck nature of oligopolistic offerings by systematically and legally eliminating or reducing the above mentioned intermediate costs. Thus they can create a sustainable business advantage. This can for instance be done by negotiating better transport and logistical costs, by offsetting the effects of exchange rates by “fixing” them more intelligently and by arranging their logistical flow in such a way that import duties are legally avoided. The latter can impossibly be done by traders alone as they are legally not entitled to do so without the involvement of a production unit. We have called this a “logistical bridge”, which “bridges” the above mentioned “Chinese wall”.

Before engaging in establishing these logistical bridges, it is however important for buying companies to do some desk research to get a good indication of the long term sustainability of such deals. In most cases the benefits of buying in another geographical area will not be positive during twelve months in a year, due to market changes and exchange rate fluctuations. Moreover, constant monitoring of the positive effect by comparing resulting prices with market prices is needed to maintain the advantage.

Our conclusions are that it is possible to circumvent the problems of “bottleneck” offering by shrewd negotiations and creative thinking. Of course, the experiences we depicted are applicable to certain types of oligopolistic products and markets. They are probably best suited for standardised or semi-standardised products. This is in line with the “portfolio model activities” proposed by Gelderman and Van Weele (2003). Looking for alternatives will in less standardised markets mean that buyers will have to concentrate on standardising materials specifications first. Moreover, buyers have to create enough internal support for the changes in material flows and logistical costs (for instance because of changes in stock volume) any “logistical bridge” might cause for their production system and the concerns about quality and timeliness of delivery that might arise.

Here I examine Jeremy Bentham’s arguments in favour of patents in light of his description of the five harms associated with monopolies. I find while these harms can be reduced by the limited duration and specific definition of patents, the existence of these harms means that a utilitarian (like Bentham) would have to support an alternative to patents if it produced the same positive results without the monopoly harms.

Cartels and monopolists can spend insufficient in the welfare sense of Kaldor and Hicks on the promotion of new products. This is likely to occur when the supply of the product is elastic. However, the opposite is likely to be the case when the supply of the product is inelastic. In the latter circumstance, monopolists and cartels gain by rapidly diffusing knowledge about a new product and letting competition among consumers force up its price.
The results apply, under the conditions outlined in this paper, to traditional textbook cartels which control supply as well as to promotional cartels which do not regulate supply but jointly control promotion in an industry. Cartels of the latter type sometimes occur in agriculture.
In general, the paper qualifies the proposition, which Doyle has attributed to Kaldor, that the amounts of advertising and promotion of products are, as a rule, over supplied from a welfare point of view. There are some circumstances in which the opposite is so.

Jurisdictional fragmentation was a defining principle of early modern European societies (EPSTEIN, 2000). The case of the Spanish empire is one of the most striking ones (GRAFE, 2012). That principle meant the existence of spaces of privilege for some actors at the expense of political debarment of others. However, privileges were not everlasting and they were frequently subject to transfer. This context framed the practice of trade and promoted constant clashes between actors who tried to enforce the implementation of their own privileges and others who contested the exclusive space enjoyed by the former. Through the examination of a case study, this paper analyzes how a single network performed both as enforcer and contester vis-à-vis other actors. The activities of the Genoese company of D.Grillo&A.Lomellino will be the case in point.

Between 1663 and 1674 Grillo&Lomellino had the exclusive right to exploit the slave trade with the Americas of the Spanish Monarchy. The relationship between the Crown and the Genoese was framed via an asiento contract, which entailed the creation of an ad hoc jurisdictional space. Although the Crown authoritatively delimitated a field of political exclusion on behalf of Grillo&Lomellino Co, its safeguarding was executed by the company in practice. The Genoese faced the problem of guaranteeing their own privileges within and across the borders of the Spanish empire on a transatlantic scale while they also challenged the exclusive jurisdictions of other actors in order to expand their own businesses. This setting led to a highly conflictive scenario in which the collaboration with other networks and actors was crucial for Grillo&Lomellino.

This contribution aims at problematizing our understanding about how of the agency of private networks was framed and exercised in competitive jurisdictionally fragmented scenarios in relation to the oblique processes of the making of Early Modern global empires.