the reason for this is that companies need a lasting competitive advantage in order to earn above avg. profits

the only competitive advantage that is lasting and most effective is barriers to entry; in other words, reducing competition, because competition lowers prices, and lowering prices cut into profits esp. when the cost structure cannot be changed and costs cannot be reduced

anyways, for example, one of the reasons brand medications are expensive is because there is limited competition in the pharmaceutical sector. There's almost no such thing as new companies being created from nothing and then rising to compete with larger companies on price. most pharmaceutical startups either get acquired or sell IP to larger companies

Congratulations, @BW10 for reaching level 8!

due to pharmaceutical companies not facing significant competition, prices dont fall. expensive FDA testing is also another reason but thats another story

The problem with pharmaceuticals s there is no central state generic producer to produce stuff ata fixed price

I don't think the govt. is very capable of setting prices that are in line with market supply and demand

Sure they are. The gov pays for all the meds so we only need to set the price at the production cost plus development, so we can also expost at dumping level

govt. is not subject to massive losses like ccorporations are bc govts. can raise taxes to make up for inefficient use of resources, which can prevent prices from going lower in line with what people can afford

govt. does not always pay for all the meds in the USA. I used to work in a pharmacy too btw and medicare is a joke

the govt. is not good at using resources efficiently, so the cost of production could be set way higher than what it needs to be

thats one of the reasons why the Great Depression in usa lasted so long was because of price and wage controls to "help" farmers

all it did was prevent people from affording food and other necessities , but John M. Keynes said "oh look there is a lack of 'aggregate demand', and a 'shortage of money', therefore lets give people money to stimulate economy and inc. aggregate demand" but he never reasoned that the reason why there is a lack of agg. demand is because people can't afford it because the prices were too high-they wouldn't come down to market levels. Keynes is a classic example of an economist confusing correlation for causation

also, consider that during the reign of the Soviet Union, the govt. would look at department store magazines from countries with freer markets, look at their prices, and use a similar price to set the price of Soviet shoes. If that doesn't say massive failure of communist govt. to set prices independently of capitalism, idk what to tell you.

I'm calling th FBI https://i.imgur.com/qXEOZRj.png

@Mazianni Welcome

Hello

Sad that there is no anarchist role

sad

the FBI crime data actually lumps whites and hispanics together, which inflates the crime rate stats of "whites"

Likewise all Arabs are white

Aye

@Mazianni

we have anarchocapitalism

Thats gay

whats you anarchy type then

Capitalism and anarchism are incompatible

I think laws are gay

ok

so what is Your ideology

then

Enlightened

All ideology is dogmatic lies

oh boi

ok I will add it

Based

Congratulations, @Mazianni for reaching level 2!

gay

Youre one to talk

Mr conservative