36 Chambers – The Legendary Journeys: Execution to the max!

April 17, 2010

An Intro To Broadband Regulation

Filed under: Curmudgeonliness, Economics — Kevin Feasel @ 9:57 pm

Jerry Ellig explains why it would be a bad idea to re-classify broadband internet providers in order to push net neutrality legislation.  The best way to kill innovation is to grant a monopoly charter to one firm.  Unless there is an absolutely strict natural monopoly (in other words, only one firm in the world could possibly exist—think of a situation such as an extremely rare mineral which can only be mined out of one location), there is still a high likelihood of market contestability, even in a market with a natural monopolist.  By giving one firm the government’s blessing, all the benefits of competition are wiped out, and there is nothing that government regulators could do to simulate this.

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