2 thoughts on “Fallacy of Equilibrium Part 2: The Supply Curve of Monopoly”
Actually, the law of diminishing marginal returns was placed in textbooks so that the assumption of perfect “free” competition could be fulfilled, otherwise it leads to large scale monopolies. You’re right to assume its false, and that production costs decrease with output, but you’re wrong to think that a “free society” would be a static one.
A ‘free society’ would realize that the current economic system is based on (nominal) paper value and so they would simply amass paper value.
This is most obviously seen in cryptocurrencies where people try to pump and dump and pull the rug. There is perfect competition among crypto creators and buyers, as there is no regulation.
Therefore, the practice of hoarding in monopolistic competition is replaced by hype marketing in perfect competition.
Economic Superphysics 
Actually, the law of diminishing marginal returns was placed in textbooks so that the assumption of perfect “free” competition could be fulfilled, otherwise it leads to large scale monopolies. You’re right to assume its false, and that production costs decrease with output, but you’re wrong to think that a “free society” would be a static one.
A ‘free society’ would realize that the current economic system is based on (nominal) paper value and so they would simply amass paper value.
This is most obviously seen in cryptocurrencies where people try to pump and dump and pull the rug. There is perfect competition among crypto creators and buyers, as there is no regulation.
Therefore, the practice of hoarding in monopolistic competition is replaced by hype marketing in perfect competition.
Our solution is a multilateral points-based economic system which allows freedom without arbitrariness: https://www.superphysics.org/social/economics/alternatives-to-money/