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Before putting into a pair of scales [???] the benefits and the damages of competition to the society, I suggest first analyzing where these advantages and disadvantages come from.
Competition is inevitable to everything in the universe. Every individual thing exists in and thus is confined by a certain situation whose status and change are beyond its control. The continuous requirement of the thing for input, namely resources, can only be met by its situation. Therefore, it has no other choice but to adapt itself to such situation. Otherwise it will slow its development or even decay to its end. If there are many individuals of the same sort under the same restraint of resources, as in most cases, fights and conflicts for resources for each one’s own use, in other words, competition, will be produced by the law of nature.
Our civilizations and we humans are not exceptions. Competition is everywhere in the world. It can never be avoided or even eliminated. If one person (or group) does not have to face competition, this means two things.
One thing is that the person will get inertial and reluctant to progress, because lack of competition helps to get him rid of responsibility, and reward too, for his work. If the results are no different, it is naturally advisable for one to choose an easier and more convenient way. In such a favorable condition away from challenges and difficulties for too long, one’s capabilities and energy will flag. And when his circumstance comes to [??] a tough change, he will be confronted with amplified challenges.
The other thing is that someone else must pays for his bill, as both a result of and a reason for his avoidance of competition. A giant business group, such as GE before Jack Welch became its CEO, has many child companies. A child company runs as a ring in the supply chain of the whole group, and partly or completely, has no necessity to compete seriously with similar companies in the open market. Bureaucracy grows and improvement delays. Loss of such a company is diverted by and to its parent group, in means like that the group purchases goods from the company at a higher price than that could be found in the external market fraught with competition. When the group is able to afford this loss, and usually there is compensation of profit from its children, in case of Scale Effect (the bigger a business is, the cheaper its product gets), everything will be OK. However, as soon as the group fails to win enough profit and goes bankrupt in the competition at a higher level, its children will suffer a tragedy or doom. And if there is only one group which dominates or occupies the market and has no threatening rivals, the group will unconsciously or calculatingly slows down its paces forward. Then, as a monopoly emerges, it will be the customers and the society that pays the bill. That’s what economists have long discussed about and why they have generally agreed on promoting competition.
A contrast between the disparate roads taken by China and Japan will perfectly elucidates what competition can introduce to the society. New China managed to turn nearly all businesses throughout the country into state-owned. And the widely applied equalization of wages among workers marked the success in minimizing competition within the country. National monopolies abounded and people became less and less satisfied by what those inertial product providers (the term of company could hardly be seen in China then) could supply. Over the ocean, Japan, who had made China and itself into debris in World War II, chose a way full of competition between free and independent enterprises, with proper policies to guide. This undoubtedly contributed greatly to Japan’s prominent take-off and rise in the global economy. Without the reform around 1980s, China may never overtake Japan and would fall in danger of repeat of the terrible aggression.
Competition, or rather to say, the mechanism and climate for competition, can expose the loss caused by inertia by returning the responsibility and concern to where it should be. Low income, bankrupt, unemployment and so on, are created not by competition but by those who, captured by inertia, deserve them. While others who manage to forge ahead in competition, will survive and thrive. Resources, always limited and relatively scarce, will be utilized in more and more efficient and beneficial ways by winners of competition. And society as a whole benefits much more than it suffers. |
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