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Regulation has done a great job in several industries of concentrating the industries into a few major players, because it is incredibly difficult to comply for new/small companies. Banking and finance is one, telecom is another.


Telecoms got itself monopolised just fine before regulations came along. AT&T sealed in the concept of operating as a regulated monopoly. But that goes back to 1913.

There are industries which tend naturally toward monopolies, with transport, communications, broadcast, and software among them. There are also industries which tend naturally away from monopolies, such as sandwich shops, cement providers, and laundromats.

(Not that there cannot be some concentration, or even national chains among these. But they're rarely dominant.)


Would you say that industries with heavy network effects tend towards monopolies, while those without tend to produce more competition?


That's a large part of it.

Transport, comms, banking, and information technology, tend toward monopolies.

Consulting is a mixed bag -- if you're relying on creativity, not so much, but if you're relying on marketing and business contacts, both of which are far more a network effect (with strong lock-in elements), yes. Contrast your typical small-gig design shop vs. the Big Declining n Accounting Firms, or IBM and Oracle (consulting / business services).

Retail can be local (small effects) or global: large grocery stores, WalMart, Amazon.

There are other effects as well. I've been curious about Maersk's adoption of ultra-large cargo ships, even as shipping volumes have been falling. While there's a financing-design-build lag, there's also the possiblity that having and operating a large ship puts pressures on other operators -- if you're operating and loading, you're taking cargo which would go onto smaller vessels.

It's complicated.

Part of this also plays into concepts of what and how technological mechanisms actuall function: https://ello.co/dredmorbius/post/klsjjjzzl9plqxz-ms8nww

I'd include among "network effects" urban and even empirical structures.


[citation needed]

Lobbying from these industries players for bad regulation might have helped but regulation is usally nothing bad. I'm happy in EU knowing that most stuff I can buy is at least to some degree vetted for killing me.




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