Mike | Abundance 🌟
@abundance
not a trick question (or is it?): if markets produce optimal resource allocation, why does no major company uses market forces for its internal operations? why do they all rely on managers and collaborative work?
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Trigs
@trigs
I agree with your point, but I'll counter with: Asynchronous information control Markets can't be effective if they don't have access to information. Companies use centralized decision making because it allows them to keep the insider information inside until they can use it to maximize their internal benefit. As access to information equalizes, markets become more effective and accurate.
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Mike | Abundance 🌟
@abundance
getting closer :) but companies don't even use "internal markets" among its employees (think Amazon or Walmart, with massive workforces) to make decisions..
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Trigs
@trigs
Well, they do. Here's a chatgpt summary of examples: https://chatgpt.com/share/6823cac1-0c74-8013-8695-df717b30f938 But I'm still in agreement that markets aren't universally better for decision making. Markets have vulnerabilities to exploitation, manipulation, and extraction. And not all situations support information transparency to a level that enables accurate market decisions. Without regulations that enforce controls, markets rarely price in externalities or ensure value alignment of participants. So markets tend to be volatile and temperamental, not rational and focused.
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