Malcontents and Monopoly Rents: An Analysis of the Nature and Quality of Discourse Around, and the Drivers of, Policy Change in the New Zealand Electricity Sector

<p>New Zealand’s electricity sector has undergone considerable change in the three decades to 2015. Those changes are part of a broader shift within the political landscape, from state intervention to market dominance and the view of individuals as consumers. An ill-fated policy proposal in 2013 called NZ Power sought to reduce electricity prices, and implement structural reform that would reverse decades of change within the sector. This thesis examines the context in which the reforms to the sector occurred so as to understand better why some policies are successfully implemented and other proposals fail. Specifically, this thesis examines the triumvirate of principal goals the sector has sought to achieve, and the political discourse around them: security of supply, economically efficient prices, and minimising environmental damage. From these insights, a framework is constructed against which future policies can be assessed as to the likelihood of their successful implementation.</p>

Malcontents and Monopoly Rents: An Analysis of the Nature and Quality of Discourse Around, and the Drivers of, Policy Change in the New Zealand Electricity Sector

<p>New Zealand’s electricity sector has undergone considerable change in the three decades to 2015. Those changes are part of a broader shift within the political landscape, from state intervention to market dominance and the view of individuals as consumers. An ill-fated policy proposal in 2013 called NZ Power sought to reduce electricity prices, and implement structural reform that would reverse decades of change within the sector. This thesis examines the context in which the reforms to the sector occurred so as to understand better why some policies are successfully implemented and other proposals fail. Specifically, this thesis examines the triumvirate of principal goals the sector has sought to achieve, and the political discourse around them: security of supply, economically efficient prices, and minimising environmental damage. From these insights, a framework is constructed against which future policies can be assessed as to the likelihood of their successful implementation.</p>

Memorializing monuments: State space and state rollback under neo-liberalization in Mexico

Recent contributions to urban geography have considered state space by innovatively focusing on specific cases of the city built environment. Examples could include here Karl Schlögel’s slicing through the spaces of state power in Moscow 1937 or Yuri Slezkine’s methodological cue to read the saga of the Russian Revolution across time in The House of Government. This article adds to the methodological insights of urban researchers by honing in on the Monument to the Revolution in Mexico City, in order to consider its role as a socially produced, conflictual and dynamically changing site in the struggle over public space and its memorialization. Since its opening in 1938, the Monument to the Revolution at Plaza de la República has been a pivotal fulcrum of state power in abetting the changing geography of state space. Equally, the site has experienced contradictions and differences stemming from socially produced space across time, in the form of periods of state crisis and, most recently, state ‘rollback’ and ‘rollout’ under neo-liberalization. This article addresses both neo-liberalizing and differential structures of feeling as they bear on the space at the Monument to the Revolution. It does so by situating the Monument to the Revolution within the urban question and how neo-liberalization has unlocked local and aesthetic meanings that have become commodified, not least through the extraction of monopoly rents. Further, the article spotlights simultaneous contemporary contestations of state power and impulses of socio-spatial struggle over difference articulated in and around Plaza de la República at the monument. In so doing, the article contributes an important pedagogical focus on both homogenizing and differential structures of feeling inscribed in spaces of capitalism in the twenty-first century.

Innovating Big Tech firms and competition policy: favoring dynamic over static competition

This paper gives a fresh account of competition in the digital economy. Economic analysis in the field of industrial organization remains largely focused on a sophisticated version of the Schumpeter–Arrow debate, which is unresolved and largely irrelevant. We posit the need to look at competition anew. Static models of monopoly firms and markets in equilibrium are often used to characterize Big Tech firms’ size and scope. We suggest that this characterization is inappropriate because the growth and diversification of many digital firms lead to a situation of broad-spectrum competition that cuts across markets. Current market positions do not reflect entrenched monopoly power but are vulnerable to competitive pressure of disequilibrating forces arising from the use of data-driven operating models, astute resource orchestration, and the exercise of dynamic capabilities. A few strategic errors by management in the handling of internal transitions and/or external challenges and they could be competitively impaired. The implications of a more dynamic understanding of the competition process in the tech sector are explored. We consider how big data and entrepreneurial management impacts firm performance. We also explore the nature of different types of rents (Schumpeterian, Ricardian, and monopoly rents) and suggest a modified long-term consumer welfare standard for competition policy. We formulate preliminary tests and predictors to assess dynamic competition. Our perspective advances a policy stance that favors innovation.

Technological and Economic Decoupling in the Cyber Era

The COVID-19 pandemic has accelerated the shift toward digital services. Meanwhile, the race for technological and economic leadership has heated up, with risks of decoupling that could set back trade and growth and hinder the recovery from the worst global recession since the Great Depression. This paper studies the conditions under which a country may seek to erect barriers—banning imports or exports of cyber technologies—and in effect promote decoupling or deglobalization. A well-known result is that banning imports may be optimal in monopolistic sectors, such as the digital sector. The novel result of this paper is that banning exports can also be optimal, and in some cases superior, as it prevents technological diffusion to a challenger that may eventually become the global supplier, capturing monopoly rents and posing cybersecurity risks. However, export or import bans would come at a deleterious cost to the global economy. The paper concludes that fostering international cooperation, including in the cyber domain, could be key to avoiding technological and economic decoupling and securing better livelihoods.

Big Tech and the Digital Economy

To date, world antitrust and regulatory agencies have invariably described large technology companies—such as Google, Amazon, Microsoft, Apple, and Facebook—as dominant, bottleneck or gatekeeping companies comparable to the textbook monopolists of the early twentieth century. They have proceeded on this basis to discipline their business activities with unprecedented financial penalties and other regulatory obligations. This “techlash” is the subject of this book. Proceeding from the observation that big tech firms engage in both monopoly and oligopoly competition across digital markets, the book introduces a theory of moligopoly competition. It suggests that rivalry-spirited antitrust and regulatory laws are both conceptually and methodologically impervious to the competitive pressure that bears on big tech firms, resulting in a risk of well-intended but irrelevant policy intervention. The book proposes a refocusing of competition policy towards certain types of tipped markets where digital firms extract monopoly rents, and careful adoption of regulation toward other social harms generated by big tech’s business models.

Antitrust in Moligopoly Markets

This chapter draws the implications of the theory of moligopoly competition for antitrust law and policy. In digital industries, economic forces discounted in received theory produce socially beneficial incentives on monopoly firms to compete by indirect entry in untipped markets, when they understand that their monopoly rents in tipped markets are under pressure. Antitrust should thus focus on maintaining competitive pressure in markets that have tipped, and apply more forgiving rules towards the leveraging of market power in untipped markets. Besides, antitrust should adopt tools that allow fact finders to draw a better line between tipped and untipped markets, complementing inferences of monopoly power drawn from structural methods of market definition and evaluation of market power.

Appropriating rent from greenfield affordable housing: developer practices in Johannesburg

‘Affordable housing’ for Johannesburg’s growing middle class is a developmentalist imperative and potentially lucrative market. However, few greenfield developers have found this market profitable. Fundamental to those who have, is control over land and its development. This paper puts heterodox urban land rent theory to work vis-à-vis the logics and practices of these developers. I illustrate how greenfield affordable housing developers work to (re)produce differential and monopoly rents in this context. Differential rents rely on investing in cheap land produced through the city’s racialised geography, and controlling land’s development through vertical integration, dynamic negotiations with local government and development finance institutions, and steering money and people into developments. Monopoly rents rely on the power of developers to act together as a class to secure land, give the appearance of competition and lobby the state in their interests. This power is built through racialised control over land and long personal connections. It is also consolidated by the state’s own land development bureaucracy and preference for ‘mega’ developments and recognisable developers. Together, these developer strategies to accrue differential and monopoly rents demonstrate their active role in the everyday making of land and housing markets. They also demand extensions of heterodox urban land rent theory: first, a more articulated understanding of how class monopoly power over land is built through race, and second, a more contingent analysis of capital’s relations to other actors and institutions, especially the state.

The Technological Basis of Egalitarian Economic Growth

This paper offers an alternative to the view that high technology promotes development and low technology inhibits development. We differentiate between monopoly technology and accessible technology. Monopoly technology produces growth by producing monopoly rents. As a byproduct, it also produces substantial inequality, both within nations and globally. Accessible technology produces growth without monopoly simply by increasing the volume of production in a lucrative business. We illustrate this first with a consideration of successful agrarian-based development in the global North that was based on agricultural products that were not particularly monopolized. We then move to a detailed consideration of fishing in nineteenth-century Norway. Norway’s economic development depended on proceeds from fishing exports. Norwegian fishing had a distinctive technology that made it particularly low-tech and egalitarian. It produced substantial wealth for the nation while producing very little social inequality.