Headline August 16, 2019/ '' ' FREE MARKET FUSS ' '' : DEVELOPING WORLD

'' ' FREE MARKET FUSS ' '' : 

DEVELOPING WORLD

THE REALISATION THAT CONVENTIONAL ECONOMIC wisdom -

Seeped in the myth of the free market, will be extremely antagonistic towards any solution based on 'protectionism and planned industrialisation', stipulates a bit of digression.

Scope limitation : the discussion here under is based on pure common sense sans any political bearing, with the simple objective of discussing alternative options for economic growth : those who know it all already need to not read any further.

While conspiracy theories may explain the 'why', it is indeed mind-boggling 'how' the world was sold an idea, i.e free markets, which has nothing to do with reality.

Essentially, you need the long arm of the government to even enforce the rules of market, including breaking cartels for countering undesirable social outcomes.

My personal favorite from the net is, ''You'll find a unicorn before you find a free market''!

Perfect competition in the free markets, even in theory inevitably eventually results in an oligopoly or monopoly, as in the case of COKE and PEPSI.

More to the point, how many genuinely believe that any domestic cola manufacturer has any chance of ever taking market share from Coke and Pepsi, say, in Pakistan; and this has nothing to do with quality or free markets!

Capturing the market for aerated colored water has only to do with deep pockets!

This example is easily applicable to our case study, the imported can opener. To recap my observations in another article, because of free markets, Pakistan had started importing can openers which were cheaper and shinier than the domestically manufactured can openers.

However, with the rupee depreciating, the Pakistani can opener might have become cheaper, but the domestic facilities have closed down and we probably have lost the skills to manufacture a can opener during this time.

At this point, foreign manufacturers will go to any lengths to scuttle any initiative for the domestic manufacturing of can openers; dumping and price war are just the tip of the iceberg.

The home country of our foreign manufacturer of can openers may probably even oppose Pakistan in the UN Security Council, just to apply pressure to protect their manufacturer's interests!

Is that voluntary trade?

Here the free market proponents argue that voluntary trade is beneficial for both parties, they argue that purchasing, say, Coke,-

Demonstrates that the purchaser values a fizzy drink more than the money in his pocket, and hence should have the right and the choice, to spend his money as he wants.

There is nothing wrong with that statement. However, no person, with even a tiny bit of common sense, is expected to borrow every day to drink a Coke, if he cannot afford to pay back that debt.

In the case of a nation, the government is the repository of common sense of the populace, so how does borrowing in dollars to pay for Cokes every for 207 million people make any sense?

How is getting burdened with external debt mutually beneficial trade?

The Honor and Serving of the latest Global Operational Research and writing on Free Markets, and The Developing World, continues. The World Students Society thanks author, Chartered Accountant Syed Bakhtiyar Kazmi.

With respectful dedication to the Students, Professors and Teachers of the world.

See Ya all on Facebook, prepare and register for Great Global Elections on The World Students Society : wssciw.blogspot.com and Twitter !E-WOW! - the Ecosystem 2011:

''' Market Manual '''

Good Night and God Bless

SAM Daily Times - the Voice of the Voiceless