Sunday, December 12, 2010

Atlas Shrugged—Chapter 4

The anti-dog-eat-dog rule was passed forbidding the railroad companies to engage in "destructive competition".
According to the economist Joseph Shumpeter, creative destruction via competition is essential to progress. The typewriter industry had to be destroyed to allow for the innovation of the computer.
An anti-dog-eat-dog policy eliminates accountability because a competitor can blame their poor performance on the competitive practices of others. It is a policy that protects the weak at the expense of the productive. It distorts the market because it prevents the necessary information or feedback that allows creative destruction to occur.

No comments:

Post a Comment