10-24-2011, 03:30 PM
Great article, thanks for the link DaveS. Good scientific studies often create more questions than they answer and that is the sense I get from this study. For example, I think the following are begging for more consideration (not all of those considerations being scientific in nature):
(from the article)
The instability is really important and needs to be understood; e.g., is this true:
If it is true, how would we go about making global anti-trust rules?
Another quote:
Not a scientific question, but how do we interpret this dynamic in terms of the morality of who deserves how much of the wealth created? If the system is evolving to concentrate more wealth in fewer hands, is that because those few who get the greater wealth deserve to have that wealth because without their unique efforts (something hardly anyone else could do) that wealth wouldn't exist, or is the concentration of wealth the byproduct of the structure of our economic systems (and not unique individual efforts)?
This has huge ramifications for the dynamics of "free" markets. Resisting changes to network structure is contrary to "free" market theory.
And in the comments, the first commenter made an interesting point, "It's interesting that only ONE of the top 50 appears to have any connection with real production - China Petrochem. All the rest are, as far as one can tell, just a bunch of money launderers." Of course, using the term, "money launderers" is unnecessarily provocative, but the underlying point is interesting.
(from the article)
John Driffill of the University of London, a macroeconomics expert, says the value of the analysis is not just to see if a small number of people controls the global economy, but rather its insights into economic stability.
Concentration of power is not good or bad in itself, says the Zurich team, but the core's tight interconnections could be. As the world learned in 2008, such networks are unstable. "If one [company] suffers distress," says Glattfelder, "this propagates."
The instability is really important and needs to be understood; e.g., is this true:
Glattfelder says we may need global anti-trust rules, which now exist only at national level, to limit over-connection among TNCs. Sugihara says the analysis suggests one possible solution: firms should be taxed for excess interconnectivity to discourage this risk.
If it is true, how would we go about making global anti-trust rules?
Another quote:
If connectedness clusters, so does wealth, says Dan Braha of NECSI: in similar models, money flows towards the most highly connected members. The Zurich study, says Sugihara, "is strong evidence that simple rules governing TNCs give rise spontaneously to highly connected groups".
Not a scientific question, but how do we interpret this dynamic in terms of the morality of who deserves how much of the wealth created? If the system is evolving to concentrate more wealth in fewer hands, is that because those few who get the greater wealth deserve to have that wealth because without their unique efforts (something hardly anyone else could do) that wealth wouldn't exist, or is the concentration of wealth the byproduct of the structure of our economic systems (and not unique individual efforts)?
So, the super-entity may not result from conspiracy. The real question, says the Zurich team, is whether it can exert concerted political power. Driffill feels 147 is too many to sustain collusion. Braha suspects they will compete in the market but act together on common interests. Resisting changes to the network structure may be one such common interest.
This has huge ramifications for the dynamics of "free" markets. Resisting changes to network structure is contrary to "free" market theory.
And in the comments, the first commenter made an interesting point, "It's interesting that only ONE of the top 50 appears to have any connection with real production - China Petrochem. All the rest are, as far as one can tell, just a bunch of money launderers." Of course, using the term, "money launderers" is unnecessarily provocative, but the underlying point is interesting.