Calculation of an efficiency within a market

10 Aug 2010
Posted by cgp

A calculator of the overall effectiveness of competition in a particular market.

For instance, do we really have competition in the distribution of cable TV? There are lots of factors here:

Symptoms of a well functioning market:

  • Lower price for service
  • Number of service providers
  • Fluidity in choice (is the market dominated by long term contracts?)
  • Quality of information regarding choices
  • The number of channels being distributed (quality channels vs. non-quality channels?)
  • Offering of Pay channels
  • Improved digital service

Conditions which market forces may have to deal with, in some cases these can be temporary

  • Government Regulation
    • Restrictions on market size
    • Ability to restrict abusers of the system
    • Mandates on availability (of which there are none now)
    • Mandates to provide ala carte service?
  • Natural disaster?

Note: A similar list could probably be done for cell phone service, and broadband service.

Close enough list for now.