John Kenneth Galbraith ✓ 4 DownloadS Simply obtaining a large or entire "Market Share Of An Industry Not "share of industry does not mean monopolistic power Differing sizes of companies are due to differing efficient sizes of serving consumers for each industry On Galbraith s criticism of wasteful advertising simply because he may not find smoking or liuor terribly important does not mean other people may not enjoy these products The purpose of advertising is to inform consumers of new products If someone invented an innovative cheap and clean alternative to our current gas powered engines then advertising is used If someone invented meat derived from plants that is cheaper and healthier than our current food then advertising is used Moreover advertising does not persuade consumers of ineffective products over the long un If a product fails to deliver promises from advertising the company s One of Our Thursdays Is Missing reputation will beightfully tarnished and fewer people will accept their claims or buy their products People are not simply brainwashed into buying *Whatever Ad Is On TV Or Radio People Are Not *ad is on TV or adio people are not zombiesFinally on Galbraith s thesis of countervailing power even if it were true workers are crushed under corporate power it does not follow that government is the solution Indeed if government attempts to manipulate and manage businesses who already has company power and influence over government agents It is of course the CEOs the lobbyists and the cronies of politicians Workers may form voluntary unions if they feel they are being treated unfairly but they are in no position to halt other individuals who are willing to work under such conditions Galbraith s over optimism on the ole and action of the government Lassie Come-Home remain unsatisfactory and unsupported American Capitalism while interesting and written clearly demonstrates how even an extremely influential economist may not know economics and is out of touch witheality The book is fraught with historical inaccuracies statistical misrepresentations over generalizations and unsupported statements Those who have studied America s Great Depression monopolies and antitrust government economic The People from the Sea regulations inflation and other supposedly Keynesianemedies will conseuently find this book greatly mistaken To better spend your time ead instead What Has Government Done to Our Money by Murray Rothbard In This book gave me some exposure and insight into the Keynesian economic theory and how the Depression helped mold the American perspective and policies on our economy both at home and within our foreign policies Sobre poder y democracia citado en La idea de justiciaThere is today much anxiety about the positional power of large multinational corporations but this is not new A concern with the dominance of modern corporations led John Kenneth Galbraith in his1952 book American Capitalism to explore the notion of the countervailing power of workers and consumer groups Ineuality P g99. Is the best answer to the market power of big food companies This work emains an essential guidepost of American s as well as that as of the American econo. S Steel is its employees or how customers organize eg the auto industry Galbraith then points out that the US Government plays a critical ole in establishing countervailing power where there wasn t before through laws and Mr. Majeika and the Dinner Lady and Mr. Majeika and the Music Teacher reforms like the minimum wage or workers safetyegulation Obviously this ole for the US Government is controversial in practiceIncreasingly in our time we may expect "Domestic Political Differences To Turn "political differences to turn the uestion of supporting or not supporting efforts to develop countervailing power Liberalism will be identified with the buttressing of weak bargaining positions in the economy conservatism and this is its proper function will be identified with the protection of positions of original power There will be a debate over whether weak positions have been unduly strengthenedGalbraith goes on to say where and why government intervention in the economy to establish countervailing power is important but the conclusions to me ultimately feel pretty obvious Curious it seems why Galbraith was as popular and celebrated as he was In this book American Capitalism Galbraith argues how companies functions inefficiently by misallocating esources and spending wastefully on advertisements Moreover as companies continue to merge and accumulate larger proportions of the market share these companies will undoubtedly be able to affect price and form a monopoly In such monopolistic position companies will be able to charge almost as much as they want and will have large power over the workforce As such Galbraith finds there are countermeasures what he calls countervailing powers which will balance the scale of power These countervailing powers include labor unions government legislation and social safety nets Thus Galbraith concludes government has an important Ninth City Burning (War of the Realms, role inegulating the economy and to help the workersYet as complete as Galbraith s analysis of American capitalism seems nearly every point is incorrect American Capitalism contains arguments from essentially an armchair economist who Der Ritter und die Bastardtochter remains ignorant of theeal world He provides no Chinaberries and Crows real examples whereby companies are able to control the entire market within an industry and it is clear why there are almost no cases There is essentially no company that came to buy every other company and then proceeded toaise its prices If one such company initiated purchasing of other companies in the industry the emaining companies will take notice If these emaining companies are still operating with a competitive edge the cost of purchasing these companies will become larger and larger thus also encouraging new companies to enter the market Now even if one company came to completely dominate an entire industry there will be still alternative Blessed Are the Wicked resources For example if one company came to own all the orange farms and all orangeelated production there emains apple lemon grapefruit milk water and so on as competitor. Ablished answer to economic power is the building of countervailing power The trade union emains an eualizing force in the labor markets and the chain store. ,
Galbraith s criticisms are valid and elouent but his solutions are broad and largely undefined The text is certainly an interesting ead for anyone who feels discontented with American Capitalism but t expect anything adically new or invigorating A Classic Very interesting to see the ole competition as an element from a Macroeconomics perspective The author emphasizes the ole of countervailing power in a concentrated economy as a disciplinary factor to Reform, Red Scare, and Ruin restrain abuse in prices to consumers andeduction in wages what competition would do in less concentrated markets This is true when there is no This work has aged but the point is still a fair one Monopolies are dangerous for the health of the economy I ead this along with several other Galbraith books for the Capitalism Democracy Socialism class taught under the Philosophy Department at Loyola University Chicago during the first semester of 198182 It is one of Galbraith s weaker texts and one of his earliest being effectively the first volume of a series including The New Industrial State and Economics and the Public Purpose Much too brief a study of its seminal thesis containing neither a thorough theoretical analysis nor a historical study of countervailing power Even "So The Concept That Market "the concept that market will develop occasionally with state support that check the excess power of other market institutions emains compelling today The labor unions which Galbraith cites as a paradigmatic countervailing power have largely withered away albeit in part through the withdrawal of state support via ight to work laws How #can countervailing powers develop to tech giants whose supply AND consumers are both us its usersI picked up this #countervailing powers develop to tech giants whose supply AND consumers are both us its usersI picked up this interested in the idea of large institutional investors as countervailing powers to corporate negative externalities I now see this does not strictly fit Galbraith s thesis which focuses on counterparties in market transactions He doesn t mention land ent Henry George or single tax Writing in 1952 Galbraith argues that the prior 20 years the great depression and Ameria s WW2 driven Lies, Damned Lies, and History recovery proves that we musteconsider a fundamental economic assumption Namely that perfect competition does not exist in the US economy and that there is enough consolidation of businesses in most industries that companies do indeed have control over prices This in turn limits optimal market efficiency and is different only in degree and precision of a single firm monopoly Galbraith goes on to argue that the most important power dynamic to study in American economics is therefore not how competitors interact to optimize prices but how customers and suppliers interact to split profits Instead of competition he calls this countervailing power Namely when one industry consolidates say the US Steel industry the important dynamic to understand is how labor organizes one of the key vendors of In his new introduction to this classic text on political economy Galbraith The New World reasserts the validity of the core thesis of American Capitalism The best and est.
John Kenneth Galbraith