I believe we are going to be at an impasse here, but the quote you extracted illustrates the point I made, that Standard Oil acted as a competitive firm. We expect to see profit driven to zero in a competitive market, and that is what we saw in Standard Oil's pricing.
In cases where there was little competition, that clearly indicates an area where the costs of the trade were such that the market price would be higher.
The former is strictly competitive and the latter is strictly not anti-competitive.
I think we're going on the wrong track. What I meant was that Rockefeller and Ellison both show that wealth doesn't always come from producing value, but can also be made by abusing market dominance.
Arguing the nuances of Standard Oil's behavior is a moot point when the Supreme Court settled that issue in 1911.
I was responding specifically to the latter portion of the quote excerpted by the grandparent post, which indicated minimal and zero profits for Standard Oil in areas with competition, in alignment with economic theory which indicates economic profit tends toward zero with increased competition.
I responded to multiple points in the post. You questioned a specific excerpt. I responded regarding that specific excerpt. You are now accusing me of laser focus.
This thread has all the markings of one that becomes net negative for all involved and those reading. I'll leave it with this:
I am focusing on the outcome to the consumer of the behavior in question, not on the outcome to competitors of the behavior.
To get a little more insight into the impact to consumers, and the reason why this behavior is illegal, read the two sections of that Wikipedia quote the other way around.
Where there was no competition, Standard Oil provided oil. Where there was competition, Standard Oil provided oil at zero or near-zero profit.
The former is a situation of supply where there was otherwise none, and some is better than none. The latter is a situation of competitive pricing, and competitive pricing is better than non-competitive pricing.
How is this worse off for consumers than the situation without Standard Oil?
No, if profit is close to zero then there would be no point in being in a market. Markets drive profits to the 'standard' risk adjusted ROI for the economy they operate in. In other words if you could run a gas station, a book store, a flower shop, or whatever, then you do whichever one gives the most profits.
You can confirm this concept in any economics text. (economics jargon) Profit is driven to zero in a (economics jargon) competitive (economics jargon) market.
Economic profit is not the same thing as profit. In a pure economic debate you can drop it, but when talking about specific firms in a general context such as HN you really should clarify.
For everyone else: https://en.wikipedia.org/wiki/Profit_(economics) "Economic profit is similar to accounting profit but smaller because it subtracts off the total opportunity costs (not just the explicit costs, but also the implicit costs) of a venture to an investor.[1] Normal profit refers to zero economic profit.[2] A concept related to economic profit, and sometimes considered synonymous, is that of economic rent."
You can think of Economic profit as the 'standard' ROI you get in a given economy. Hypothetically Economic profit is also being driven to zero in a static economy, but that's a separate and long term thing.
PS: I am just being this clear because general HN readers are likely to miss the distinction.
In cases where there was little competition, that clearly indicates an area where the costs of the trade were such that the market price would be higher.
The former is strictly competitive and the latter is strictly not anti-competitive.