G'Day Bits:
Thanks for the Brooks reference. My impression was that income and wealth are more unequally divided in Canada than indicated. I suppose I should read the study.
My harping on senior government transfer payments to cities was me trying on the idea of cities as just another subsidy to employers that has the usual attendant economic horrors of such things as distorted resource allocations.
I believe that centralization of large organizations in urban areas remains common even though a typical result is declining price/quality ratios of their products. The explanation may be that operating costs are cut even more than lost revenues are lost due to declining price/quality. Price goes up but so do profits. The records of privatized natural monopolies such as utilities comprise temples to the gods of profits. The question is whether managements would continue to centralize operations if subsidies to cities from senior governments were not available. Operating costs presumably would be higher.
I don’t have an answer, but one thing does seem certain about transfer subsidies. When they are available management is not motivated to seek alternative solutions. Centralization proceeds even though the technology to support highly decentralized management is commonly available. Developing management techniques and skills to apply technology and create distributed and dispersed organizations does not create profit. It’s easier to demand more subsidies to cities. Thinking stops but the pay cheques increase.
Perhaps my assessment isn’t entirely fair, but I’m just trying on an idea. I believe that the world’s largest distributor of recorded classical music has a highly distributed operation.
Thanks for the Brooks reference. My impression was that income and wealth are more unequally divided in Canada than indicated. I suppose I should read the study.
My harping on senior government transfer payments to cities was me trying on the idea of cities as just another subsidy to employers that has the usual attendant economic horrors of such things as distorted resource allocations.
I believe that centralization of large organizations in urban areas remains common even though a typical result is declining price/quality ratios of their products. The explanation may be that operating costs are cut even more than lost revenues are lost due to declining price/quality. Price goes up but so do profits. The records of privatized natural monopolies such as utilities comprise temples to the gods of profits. The question is whether managements would continue to centralize operations if subsidies to cities from senior governments were not available. Operating costs presumably would be higher.
I don’t have an answer, but one thing does seem certain about transfer subsidies. When they are available management is not motivated to seek alternative solutions. Centralization proceeds even though the technology to support highly decentralized management is commonly available. Developing management techniques and skills to apply technology and create distributed and dispersed organizations does not create profit. It’s easier to demand more subsidies to cities. Thinking stops but the pay cheques increase.
Perhaps my assessment isn’t entirely fair, but I’m just trying on an idea. I believe that the world’s largest distributor of recorded classical music has a highly distributed operation.