Comments on: The Cupidity of the Indian Government http://www.deeshaa.org/2004/06/10/the-cupidity-of-the-indian-government/ Mon, 13 Feb 2012 05:41:09 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Atanu Dey on India’s Development » The Government’s Anti-Midas Touch http://www.deeshaa.org/2004/06/10/the-cupidity-of-the-indian-government/comment-page-1/#comment-75141 Atanu Dey on India’s Development » The Government’s Anti-Midas Touch Fri, 26 Jan 2007 02:45:33 +0000 http://home.blogstreet.com/2004/06/10/139#comment-75141 [...] Previous post: « Wrong-headed policies condemn millions to misery Next post: The Cupidity of the Indian Government » 0 [...] [...]
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]]> By: Kirthi Ramakrishnan http://www.deeshaa.org/2004/06/10/the-cupidity-of-the-indian-government/comment-page-1/#comment-222 Kirthi Ramakrishnan Unknown, 30 Nov -0001 00:00:00 +0000 http://home.blogstreet.com/2004/06/10/139#comment-222 It is ironic, isn't it, that at the end of the day, it turns out that what is being done is to exchange public monopolies for private ones. What these guys don't seem to get is that "It's the competition, stupid". It's not abput who plays in the game, it's how many players you have in the game. Why can't these guys learn from other countries' mistakes? That's the only advantage of being the last to do anything, anyway. In the US for instance, in cable broadband, the providers have in most markets carved it up between themselves, effectively killing choice for a given consumer. So even though on paper there appears to be a thriving marketplace, within an area there is one provider, hence giving rise to a monopoly cartel. The result, cable broadband prices have been increasing steadily in the US with decreased flexibility of choice. The other problem arose in Europe where they did a beauty contest to auction off spectrum. Companies invested so much to get the license, in the end they weren't worth so much, driving a lot off them to bankruptcy, and over investment. Instead of this farce, they are probably better off keeping this in the public sector but have more than one company, hire professional managers who are compensated on performance, and given full freedom. The government can then just be a shareholder of these competing companies just like anybody else, controlling in theory but passive in practice. This way the general public still gets to be the shareholder shutting up the commie complaint but also enjoys the benefits of competition. It is ironic, isn’t it, that at the end of the day, it turns out that what is being done is to exchange public monopolies for private ones. What these guys don’t seem to get is that “It’s the competition, stupid”. It’s not abput who plays in the game, it’s how many players you have in the game. Why can’t these guys learn from other countries’ mistakes? That’s the only advantage of being the last to do anything, anyway. In the US for instance, in cable broadband, the providers have in most markets carved it up between themselves, effectively killing choice for a given consumer. So even though on paper there appears to be a thriving marketplace, within an area there is one provider, hence giving rise to a monopoly cartel. The result, cable broadband prices have been increasing steadily in the US with decreased flexibility of choice. The other problem arose in Europe where they did a beauty contest to auction off spectrum. Companies invested so much to get the license, in the end they weren’t worth so much, driving a lot off them to bankruptcy, and over investment.

Instead of this farce, they are probably better off keeping this in the public sector but have more than one company, hire professional managers who are compensated on performance, and given full freedom. The government can then just be a shareholder of these competing companies just like anybody else, controlling in theory but passive in practice. This way the general public still gets to be the shareholder shutting up the commie complaint but also enjoys the benefits of competition.

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