Culturally we expect modern organizations to become a monopoly

# Culturally we expect modern organizations to become a monopoly “That’s great!” I said, “Are you thinking straight up liberal arts university?” “No - more like a school for founders” At that moment I realized my brain immediately went from ‘excited!’ To “isn’t that just Y Combinator? Why does the world need another Y Combinator?” Why didn’t I react to the original statement with “isn’t that just Harvard?” This contrast illustrates a subtle point. There’s a cultural attitude that new organizations can and should become monopolies, otherwise they’re failures. On the other hand, it seems significant that the important Level II institutions like “The Press” or “Academia” do not lend themselves to natural monopolies. If an organization/Level I institution becomes a monopoly, it no longer has competitors and therefore destroys the group selection mechanism - it *becomes* the Level II institution. [[Institutions are the second level of a group selection evolutionary system]]. Modern organizations can become monopolies more easily thanks to the internet. The internet allows someone from almost anywhere to provide a good seamlessly to almost anyone from almost anywhere. That enables a company from California to compete for a customer in North Carolina or New Zealand as well as a company in North Carolina or New Zealand could. The trick is that this isn’t limited to just physical goods or business services. As Economist/Podcaster [[Russ Roberts]] has noted several times - while you used to have no choice but to listen to the crappy fiddler in your home town, everybody can now listen to [Itzhak Perlman](https://www.youtube.com/watch?v=1rT8KC10ErA) for free with basically the same quality as real life. This change is great in the short term for people who love violin music, but has plunged musicians into a brutal competition for the top spot. In the same way, the internet has made it easy to determine the most popular physicist or thought leader on any topic. And people are not forced to compete just within their silos - at the end of the day, [[Human attention is the only finite resource]] and the internet has basically created a single game where attention is at least perceived to directly equate to money *and* status. [[“Have your cake and eat it too” life-games have led to a toxic society]]. So not only is the violinist competing for monopoly power against all the other violinists, she’s competing against public-facing physicists as well. [^1] This drive towards monopoly causes intense competition and removes any [[Slack - concept]] in the system. It’s exactly the brutal competition that a higher-level set of rules mediate. This is why (at least in my head) all of Disney+, Netflix, and HBO are kind of failures for not destroying/consuming the other players and becoming the only streaming service while it is weird to think of Harvard as destroying/consuming Yale and Oxford to become the only University. To go one step farther - [[If there is a possibility for a monopoly, an institution is either nonexistent or worthless]] The (rational) cultural attitude of ‘monopoly or bust’ may be one reason why people aren’t building more institutions. [[Why aren’t people building more institutions?]] If there is a high opportunity cost to *not* building a monopoly, why would you build something that has limitations? ### Related * [[Having more separate games is good for society]] * [[Knowledge of how markets and innovation work has made us jaded]] [^1]: There are at least two huge caveats here. 1. The argument for why the internet has caused a monopoly (and therefore institutional disintegration) suggests “the internet is bad!” This is also not true! First, people have access to higher quality entertainment, information and peers than ever before. Similarly producers have access to markets that would have been inaccessible before - if someone from the middle of nowhere is an amazing violinist, they don’t need to go to NYC and happen to meet some orchestra director in order to be discovered. Additionally, the internet has enabled producers to sustain themselves by catering to niche markets that could never have existed in a single geographic location. Is the niche explosion contradictory to the monopoly push story? I don’t think so for two reasons. First, the majority of people have moved to the ‘main’ game - crudely - it’s gone from a world with five games with 20 units each to a hundred and one games but one has 99 units and the rest have 0.01 unit. Second, niche-pursuers are perceived almost as second-class players. ‘Lifestyle business’ has a pejorative ring to it. Maybe that’s just the Silicon Valley crowd, but it feels like that attitude has leeched into culture as a whole. 2. In reality, attention is less correlated to money and status than people perceive it to be - lots of ‘influencers’ aren’t super well off monetarily or status-wise. But the strong *perceived* coupling between attention and winning is what drives people’s actions.  [Web URL for this note](http://notes.benjaminreinhardt.com/Culturally+we+expect+modern+organizations+to+become+a+monopoly) [Comment on this note](http://via.hypothes.is/http://notes.benjaminreinhardt.com/Culturally+we+expect+modern+organizations+to+become+a+monopoly)