Businesses need to fail because otherwise the wrong people end up leading.
When businesses fail, their competitors buy their assets, employees, customer bases, and get bigger. Keep playing that a few more rounds and you get a monopoly that can and will prevent or buy new entrants. Then anyone including the wrong people in the industry enter this one company because that’s the only company in this industry.
This isn’t an argument against letting businesses fail. It’s an argument to show that the game of competition doesn’t produce stable competitive environment in the long run. Instead it’s a temporary stage that some markets exist in on the way to consolidation. You can find countless examples for this around us. And therefore letting businesses fail through competition isn’t a long term solution to these problems.
I’m not familiar with the corporate landscape in Germany, but the US and Canada also have anti-trust law and competition agencies whose purpose is to prevent consolidation. Why hasn’t that prevented it?
When businesses fail, their competitors buy their assets, employees, customer bases, and get bigger. Keep playing that a few more rounds and you get a monopoly that can and will prevent or buy new entrants. Then anyone including the wrong people in the industry enter this one company because that’s the only company in this industry.
This isn’t an argument against letting businesses fail. It’s an argument to show that the game of competition doesn’t produce stable competitive environment in the long run. Instead it’s a temporary stage that some markets exist in on the way to consolidation. You can find countless examples for this around us. And therefore letting businesses fail through competition isn’t a long term solution to these problems.
And that’s why you have laws and agencies to prevent that like the German Bundeskartellamt.
I’m not familiar with the corporate landscape in Germany, but the US and Canada also have anti-trust law and competition agencies whose purpose is to prevent consolidation. Why hasn’t that prevented it?
Because nobody enforces the law. There are so many mega corpos that needs to be broken up, but it doesn’t happen.
Because you have an oligarchy