LCD makers in $553 million U.S. price-fixing accord
reuters.com
reuters.com
Considering how often these sorts of stories pop up (once in a while -- maybe a few times a year), and how profitable I would expect to be, I bet price-fixing happens way more often than once in a while. I wouldn't be surprised if it were the norm amongst big electronics manufacturers for most products.
I don't expect raising penalties to be effective at stopping this -- they're settling anyway. It's so profitable and so hard to catch that probably most companies would rather take the risk. If there were a better way of enforcing it, it might work.
Just look at the price delta for those TV's with Netflix streaming vs those without. You can't tell me it costs $300ish to add the parts to make this work. Wireless chips cost a few cents... the screens already have a CPU in them to handle everything, so add a few cents, or maybe $1 to add a better CPU...
Do I have specific evidence? no.
The current situation is even more dire. None of the LCD panel makers have turned a profit for almost two years now as rapid LCD TV demand growth has slowed down. I'm not saying their behavior should be condoned, but this is kicking them while they're down.
It's sort of the same as anti-monopoly laws. In a strict sense, maybe a company became a monopoly legally, by offering the best product and buying out its competition, and is acting rationally in the interest of its shareholders -- but now the market is powerless before it, so the government breaks it up, and the market has bargaining power again.
Most of the pragmatic policies that make our world work break down on a moral level when you look at them too hard. We're all just trying to do what works empirically.
The market wins when the price-fixing stops being worth the opportunity cost of increased sales, or when a competitor (new or old) decides not to play ball. Not when the government steps in to force things in a certain direction.
>Most of the pragmatic policies that make our world work break down on a moral level when you look at them too hard. We're all just trying to do what works empirically.
The uneasiness I feel at the implication that things can be looked at "too hard" aside, how can one actually justify the claim that this works empirically ("works" meaning, presumably, in this case, that a better outcome is achieved)?