The funny part here is that the free market supporters also tend to be the people who are against regulations that would help combat price fixing and other similar regulations that would help protect the free market. They usually do this by calling the proposed regulation socialism and the like, and lobby against it accordingly.
[−]breakwaterlabs · 2026-11-15 Sun 13:27 UTC ·
link
Free market supporters being against regulations is just part of being a free market supporter.
Regulations are inherently against a free market. This is not an ideological stance, it's just what the words mean.
Sometimes there is an argument that conditions do not favor a free market and regulation is required to fix that defect, but that's rather situational.
I mean, it depends how you define a "free market" doesn't it? A market filled with monopolies and price fixing schemes is not "free" in my personal experience with it. None of the assumptions about Capitalism (the good assumptions, about supply and demand, new competition being able to enter and undercut, innovation being a way to gain a piece of the pie, etc), can be said to faithfully apply to a market that isn't at least minimally regulated to get rid of price fixing and monopolies and cartels.
I mean, we had this discussion before a very long time ago and then it seems like libertarianism took off in start up tech spaces...who are relying on the lack of monopolies and price fixing specifically for their own businesses to be able to be successful...so I don't think the libertarian attitude of a lot of HNers really fits, given the amount of effort the government of the past has put into making the market actually "free" in a real sense and not just a liberal philosophical sense of it technically being possible for you to start a company to try to enter a business (only to get eaten alive by an entrenched oligopoly, for instance).
In some types of businesses, I think there is also good reason to not want it to be a free market. For instance, the nuclear weapons business. So we accept that the "free market" shouldn't apply to everything already.
I think with chip companies, the danger is that it is incredibly risky and expensive to enter the business, so you need to be very wary and on the lookout for things like price fixing and oligopolies...it is in the interests of the established players to do those things. And we haven't really seen very many new entrants to these markets for perhaps good reason (being very difficult to get the amount of VC needed for hardware startups and general wariness about hardware startups in the VC world)...but also perhaps if there was a price fixing schemes...that would also be a reason we haven't seen any new entrants.
Alright, but let's think about the example that started this. So, we have these RAM manufacturers doing (or alleged to be doing) price fixing. Now, price fixing is considered to be antithetical to a free market system due to subverting both competition and supply and demand.
So let's say we have regulation meant to combat price fixing or perhaps a judgement from a court of law against parties engaging in price fixing, like what happened with DRAM manufacturers 20-ish years beforehand. Well, by the logic you presented, those are also detrimental to a free market. However this leads to a contradiction, as both regulating and not regulating is a detrimental choice. Either you don't regulate, in which case price fixing -- and also we of course have to take into account that a similar argument argument against regulations also works for (unregulated) monopolies, monopsonies, and other sundry cartel actions -- will negatively undermine the free market. On the other hand, regulating price fixing, monopolies, monopsonies etc. will also negatively undermine the free market.
So, we have a logical inconsistency here as presented. So we realistically have three possibilities:
a) the free market itself is logically contradictory. I mean, many socialists in particular have argued for this position, but I at least don't find this consequent very attractive. It _could_ be true, but let's look at the other two.
b) that price fixing is not detrimental to the free market. Well mayhaps, but that really doesn't seem to correspond to the consensus around price fixing and other similar anticompetitive practices. And as said, the same argument could be made for monopolies and such, so you'd basically have to argue that none of them are detrimental to the market either.
c) that regulation isn't necessarily detrimental to the free market. You kinda already conceded this point, as you said
> Sometimes there is an argument that conditions do not favor a free market and regulation is required to fix that defect, but that's rather situational.
And if we assume this, then the question is no longer whether regulation is always bad for the market, but where the line is between regulation that is bad for the market and which is either neutral or positive for the market. But then the words no longer mean what they should mean by surface analysis, and that's a travesty!
So where does that leave us? Well, for myself the answer seems obviously to be that regulation can be non-detrimental to the free market, etymology be damned! And so in this case, at least from where I'm sitting, a free market advocate should be for legislation against price fixing. But they might think differently, in which case they should justify their views.
Not really. Wikipedia defines it as "an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any other external authority." That means that sellers are free to do whatever they want.
A free market assumes that there is healthy competition among sellers, so they do not have incentive to collude. In a healthy market, if five sellers colluded to keep the price high, a sixth seller should pop up and undercut the colluding sellers to capture business from the overpriced colluding sellers.
[−]Systemerror7A69 · 2026-11-15 Sun 12:41 UTC ·
link
Sure, but that's really naive in practice, isn't it? Because "a new competitor comes in" really isn't as easy as it sounds, especially in chips for example. Getting to the point where you can actually compete is really, really, really difficult and requires a lot of investment (money, time and resources).
Like many aspects of idealized Capitalism, I think it doesn't work in practice nearly as well as it does in theory. Which is why we made laws about this sort of stuff a long time ago. But they've not really been super strictly enforced for a while has been my impression. Perhaps they should be again?
Difficult when Capital is global and the companies making all this stuff are global. But I think they'd accept a US court decision given the centrality of that market...
If the government doesn't intervene, there's no control, so sellers can do whatever they please. Hence price fixing, dumping, monopolies, etc., are all possible in a free market. There's no contradiction.
> [If] price is not set by supply and demand, [...] you do not have a free market
You can't even define what "set by supply and demand" means. Supply and demand are variables in some equation that does not and cannot capture reality.
Regulations are inherently against a free market. This is not an ideological stance, it's just what the words mean.
Sometimes there is an argument that conditions do not favor a free market and regulation is required to fix that defect, but that's rather situational.
I mean, we had this discussion before a very long time ago and then it seems like libertarianism took off in start up tech spaces...who are relying on the lack of monopolies and price fixing specifically for their own businesses to be able to be successful...so I don't think the libertarian attitude of a lot of HNers really fits, given the amount of effort the government of the past has put into making the market actually "free" in a real sense and not just a liberal philosophical sense of it technically being possible for you to start a company to try to enter a business (only to get eaten alive by an entrenched oligopoly, for instance).
In some types of businesses, I think there is also good reason to not want it to be a free market. For instance, the nuclear weapons business. So we accept that the "free market" shouldn't apply to everything already.
I think with chip companies, the danger is that it is incredibly risky and expensive to enter the business, so you need to be very wary and on the lookout for things like price fixing and oligopolies...it is in the interests of the established players to do those things. And we haven't really seen very many new entrants to these markets for perhaps good reason (being very difficult to get the amount of VC needed for hardware startups and general wariness about hardware startups in the VC world)...but also perhaps if there was a price fixing schemes...that would also be a reason we haven't seen any new entrants.
So let's say we have regulation meant to combat price fixing or perhaps a judgement from a court of law against parties engaging in price fixing, like what happened with DRAM manufacturers 20-ish years beforehand. Well, by the logic you presented, those are also detrimental to a free market. However this leads to a contradiction, as both regulating and not regulating is a detrimental choice. Either you don't regulate, in which case price fixing -- and also we of course have to take into account that a similar argument argument against regulations also works for (unregulated) monopolies, monopsonies, and other sundry cartel actions -- will negatively undermine the free market. On the other hand, regulating price fixing, monopolies, monopsonies etc. will also negatively undermine the free market.
So, we have a logical inconsistency here as presented. So we realistically have three possibilities:
a) the free market itself is logically contradictory. I mean, many socialists in particular have argued for this position, but I at least don't find this consequent very attractive. It _could_ be true, but let's look at the other two.
b) that price fixing is not detrimental to the free market. Well mayhaps, but that really doesn't seem to correspond to the consensus around price fixing and other similar anticompetitive practices. And as said, the same argument could be made for monopolies and such, so you'd basically have to argue that none of them are detrimental to the market either.
c) that regulation isn't necessarily detrimental to the free market. You kinda already conceded this point, as you said
> Sometimes there is an argument that conditions do not favor a free market and regulation is required to fix that defect, but that's rather situational.
And if we assume this, then the question is no longer whether regulation is always bad for the market, but where the line is between regulation that is bad for the market and which is either neutral or positive for the market. But then the words no longer mean what they should mean by surface analysis, and that's a travesty!
So where does that leave us? Well, for myself the answer seems obviously to be that regulation can be non-detrimental to the free market, etymology be damned! And so in this case, at least from where I'm sitting, a free market advocate should be for legislation against price fixing. But they might think differently, in which case they should justify their views.
So it doesn't just work like that in practice.
Difficult when Capital is global and the companies making all this stuff are global. But I think they'd accept a US court decision given the centrality of that market...
- price of goods is set by supply and demand
- the government doesn't intervene (for example through subsidies)
Price fixing is defined by:
- all the sellers (or buyers) agreeing on and therefore setting the price
- price is not set by supply and demand, therefore you do not have a free market
If the government doesn't intervene, there's no control, so sellers can do whatever they please. Hence price fixing, dumping, monopolies, etc., are all possible in a free market. There's no contradiction.
> [If] price is not set by supply and demand, [...] you do not have a free market
You can't even define what "set by supply and demand" means. Supply and demand are variables in some equation that does not and cannot capture reality.