I don’t usually write “just go read this” posts, but I’m going to make an exception for this piece by Matt Stoller on how a monopolized economy causes shortages. This is the best article I’ve ever read on how monopolies and oligopolies work (Stoller tends to just say monopoly), and how their incentives systematically induce them to reduce the welfare of almost everyone in society.
Matt starts by noting that now that Uber and Lyft have destroyed Washington DC’s cab companies, waits for rides are now ten to 20 minutes, as well as being more expensive.
It was obvious that this was the play; destroy the cab industry by underpricing, then reap monopoly profits, and it’s something I pointed out repeatedly for years.
But Matt has put together a systematic explanation of how the entire process works which is the best I’ve seen, and you should read it.