SJS, this is one of my favorite topics also.
Actually the concept of free market economics is only that of a concept. Ever since the beginning of the "superpower" that is the American nation, the economy has always been mixed combination of free-market and goverment regulation. I disagree with your opinion that completely free markets are better. In completely free markets, it is natural for monopolies to form especially industries with natural barriers to entry. It is because of government laws and regulations that some monopolies have been avoided or dismantled. This being said, government regulations has also led to the granting of monopolies. However your suggestion that we have a monoply is not true. We hold a exclusive agreement for one brand of clutch for the NSX. There are many other options readily available to NSX cosnumers, so they have a choice. Given the fact that we also sell to other vendors, we are also not the only choice to purchase the Exedy Twin Plate Clutch from. So how can we be considered a monopoly?
As to you reference to the U.S being a "superpower". One of the reasons why U.S. economy is as successful as it is today because of a goverment granted "monopolies" called "patents", "trademarks", and other intellectual property rights. Without these "monopolies", economic activity, culture, and many other parts of society can not function. A free market would be one without monopolies such as "patents", "trademarks", etc. Now, how well do you think the U.S. economy be if this system all the sudden collapsed?
It is these "exclusive agreements" that have enable virtually all of global trade. In order for business to provide foreign "new products" they need a security base that enables them to exist after the introduction of the product, otherwise it would not be worth their time and money. Most American companies sell to Asia, Europe, etc based soley on "exclusive agreements".
"exclusive agreements" are barriers to protect and reward a companies efforts, risks, etc in order for them to operate and distinguish themselves. This is no different than a "consumer" that "works hard" in college to get a "degree" which serves as a barrier to higher paying jobs. How happy would you be if you went to Harvard only to find out they gave degrees to anyone who asked?
Many NSX products have been recently (2-3 years) introduced to the U.S. from Japan such as Taitec, GruppeM, etc. A lot of these products are sold under "exclusive agreements". Without these agreements, many of these products would never have been introduced or maybe quite a bit later. Isn't access to products and greater varieties of products better for the NSX consumer?
Originally posted by sjs:
One of my favorite topics!
Alexander.
In theory (but all too often not in practice) this is a free market system, which is one of the primary reasons that our comparatively young nation is such an economic superpower. For the most part, I personally object to the type of exclusive agreement you describe, and I disagree that it is better for the consumer. Yes, I know all the arguments used to support that position, I just feel that on balance the consumer is better served by a bit of competition. Not just in terms of prices, but also service. There is nothing more often proven in the world than the almost inevitable negative impact of a monopoly.
I could go on for many pages, but I'll spare you all for now.
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