en-us https://www.intensedebate.com/users/1882364 Comments by geoffreytransom http://mises.org/preview/6226/Mises-on-Secession#IDComment745358007 Of COURSE there is such a thing as a &#039;natural monopoly&#039; under perfect competition: it is simply the situation in which the minimum-efficient-scale (the number of firms consistent with cost-minimisation) is 1. What that means is that the production technology is such that the single firm is still experiencing economies of scale (falling costs as output increases) in production at the point at which its marginal cost schedule intersects with market demand. (Note: this analysis can NOT apply to government, since it does not acquire its &#039;initial condition&#039; - it&#039;s budget - in the market) The difference between &#039;natural&#039; monopoly and &quot;GOLEM&quot; (government-originated, legally-enforced monopoly) is that the natural monopoly is the welfare-maximising situation given technology and factor endowments: in the absence of (artificial) barriers to entry other entrants are free, if they possess technology that enables them to compete, to enter the market. I am constantly astonished at folks who think that they have to trot out economically-ignorant twaddle to buttress &#039;our&#039; side (I am a Rothbardian anarchist - so much so that I invented the term &#039;kratoklast&#039; because &quot;anarchist&quot; isn&#039;t &quot;action-y&quot; enough). It does our movement a disservice when some amongst us claim that (a) there&#039;s no such thing as market failure or externalities (both claims are nonsense); or (b) that natural monopoly is a shibboleth. The central problems with &#039;majority rule&#039;/&#039;representative democracy&#039; are several-fold - <ul><li>first, pace Arrow&#039;s 1950 Impossibility Theorem, it is not possible to infer a well-formed social welfare function by aggregating individual ordinal preferences; </li> <li>second, pace the Gibbard-Satterthwait Theorem, all voting mechanisms are either exclusionary or corruptible through tactical voting; </li> <li>third, the &#039;principal-agent&#039; problem - that political actors have their own preferences which are not co]terminous with that of the electorate; </li> <li>fourth, &#039;adverse selection&#039; in political cadres (high-functioning sociopaths have a competitive advantage in competitions involving gulling the masses)... </li> <li>and lastly (for now) - that apart from being impossible as far as &#039;representing&#039; the social welfare/general will/mind of the people... it&#039;s not even &quot;MAJORITY&quot; rule (the proportion of the adult franchise achieved by most &#039;elected&#039; leaders is about 38%. </li>&lt;/ul? Now think hard about the Arrow Theorem: it is false that a &#039;democratic&#039; system accurately reflects social preferences (or the general will). So we are left with - at best - some &quot;approximation&quot; of the general will... and we don&#039;t know (and CAN&#039;T know) how accurate that approximation is. Anybody who claims that this approximation is sufficient to deny - by force - individuals the right to abstain from funding the State, is making a genuinely extraordinary claim (as extraordinary as the two jokers above who were serially pontificating about the meaning inherent in fictional conversations between fictionalised characters in some Iron Age death-cult fairy tale about Jeebus, Son of Zeus). Extraordinary claims require extraordinary evidence: the burden of proof is not on <i>anarchists</i> to show that life would be better under anarchy - the burden is on <b>Statists</b> to show that their false claim of representativeness is sufficient to dragoon all inhabitants under the thrall of the State on the say-so of less than 40% of the franchise.</ul> Wed, 6 Nov 2013 10:04:03 +0000 http://mises.org/preview/6226/Mises-on-Secession#IDComment745358007