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by flamble 1911 days ago
It's possible that once a company reaches a certain size, it's inevitable. Corporations internally have the same top-down centralized organizational structure as a typical government. Market forces can't eliminate that kind of inefficiency if it invariably affects all large enterprises, and the economies of scale enjoyed by such companies outweigh the perverse incentives of sub-organizations.

What strikes me as unique to government is the tendency for sufficiently powerful appendages to secure enough resources to start wagging the dog (e.g. the military industry in the US), although now that I think about it seems possible that it would happen within companies.

2 comments

Also don’t forget how unevenly applied market forces are: if McDonald’s started charging 10% more for a hamburger they’d lose sales to Burger King a LOT faster than, say, Comcast or Oracle because the products are basically the same and most customers can switch almost effortlessly whereas you have to be especially mad to trench fiber out to your house or migrate every database in a large enterprise.

Any business with a natural monopoly, high migration costs, etc. can support a surprising amount of inefficiency even if most of their customers find the experience unsatisfying.

I think the common feature is just humans.

I think we imagine a lot of market forces that no doubt exist, but people aren't logical in the face of them.