I understand how regulation benefits established players. Basically, major established business interests in a particular industry benefit from regulations which don't cost them very much to comply with but impose large costs on would-be newcomers to the industry. This helps restrict competition.
I've come across the following assertion more than once in my multi-dimensional travels through the mises.org reading materials (paraphrase, I cannot remember now who/where this quote comes from, but it has been simmering in the back of my mind): "Established business interests benefit from taxation of their industry. If you follow a good from the initial phases of production to final consumption, you will find a series of taxes and tariffs levied at each point, and a corresponding premium collected by the industry players."
So, how does a tax help established players in an industry? If I make widget X, how does government taxation of widget X help me garner higher profits or exclude competition, etc.?
Clayton -
If an industry is taxed, obviously the established players will be able to take the burden of taxation easier than smaller businesses. If an industry's goods are taxed, then the demand for those goods would be smaller, which makes it harder for smaller businesses to outcompete and outsell the established ones. Another issue is that the majority of subsidies go to the larger, more established businesses due to smaller risk and smaller costs of doing so.
Mises Community Natural Rights Discussion Group
The only thing that benefits from taxes is those that collect it! When are humans going to realize that ONLY death is inevitable - that taxes are a man made invention and not necessary for life. And because the usual knee-jerk response to this statement is 'How will things get paid for if there aren't taxes?" The SAME way the always do in a FREE market - by those who want the goods/services enough to pay for them. No payment, no goods/services - period.
Reunite cause with effect and live a more direct and simpler life, without TAXES, thank you very much.
Jain
Well, what Krazy said, but also big buisness can afford to pay for lawyers to make sure the IRS doesn't come after them, and can afford to take the IRS to court whereas small buisness can't.
"You don't need a weatherman to know which way the wind blows"
Bob Dylan
^ Another thing is that big business can employ lawyers to find tax loopholes whereas smaller businesses cannot.
Thanks guys, I get it, now. It's basically the same way they benefit from regulatory costs, just more direct.
Summarizing the above, taxation and other forms of government interference increase the barriers to entry which is to the benefit of the established firms.
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