From: Alejandro Agafonow (alejandro_agafonow@YAHOO.ES)
Date: Fri Apr 27 2007 - 10:27:35 EDT
Dear Friends:
There is an issue suggested by Cockshott that has worried me. I’m not especially skilled concerning the history of software/hardware markets but the intellectual exercise worth while.
A paradigmatic situation, evoking the entrepreneurship dynamic Austrians have in mind, is the emergence of Apple facing the computer giant IBM. Do you remember a known movie reporting the story? Two boys, Steve Jobs and Steve Wozniac, building a prototype in the Jobs’ garage paving the way to overtaking IBM.
Cockshott seems to have evidence that prices at that time didn’t suffer big changes. To extract some lesson from this event we would have to know the market concentration data measured, for example, by Herfindahl-Hirschman Index. But the question is whether the price channel could reliably report the revolutionary technological change emerging at that time.
Considering the accent putted by Hayek on prices as an information channel, there is the risk of concluding that Austrian theory is not able to explain this prices stability. Nevertheless, from a broader Austrian point of view is possible to conceive a situation like that one. The key is the relative scarcity of the software/hardware at that time in the light of demand. As I told you, we should check data, but if the technical facilities offered by Apple merely switch over the relative market power from one firm to another, it is expected that prices don’t record the substantive technical change happening. The motivational source of the market power switch over has to be found in the extraordinary profits characterizing a monopoly, another characteristic of Austrian dynamic.
Best regards,
Alejandro Agafonow
____________________________________________________________________________________
LLama Gratis a cualquier PC del Mundo.
Llamadas a fijos y móviles desde 1 céntimo por minuto.
http://es.voice.yahoo.com
This archive was generated by hypermail 2.1.5 : Mon Apr 30 2007 - 00:00:17 EDT