Chapter 16: Monopolistic Competition

This chapter introduces and analyzes monopolistic competition. A monopolistically competitive market lies in between perfectly competitive and monopolistic markets. This type of market is characterized by three attributes: many firms, differentiated products, and free entry. A monopolistically competitive firm shares similarities with competitive and monopolistic firms. It is a price maker and not a price taker, however  it can not earn economic profits in the long run. Like a monopoly, monopolistically competitive firms charge a price above marginal cost. Monopolistically competitive firms also do not produce at the efficient scale. They operate on the downward sloping portion of the demand curve, and therefore are producing less than the optimal quantity. The number of firms in a monopolistically competitive market can be either too large or too small. When it is too small, firms enter the market, driving already established firms to zero economic profit, conveying a positive externality on consumers due to greater variety of products and conveying a negative externality on existing firms due to loss of customers. Due to product variety in a monopolistically competitive market, many firms advertise their product. There is a debate over whether advertisement is good practice. Critics argue advertisements take advantage of consumers and reduce competition while defenders argue that advertisements inform consumers and increase competition.

The Climb/The Racetrack/The Life of Iron

The Climb

A hiker was trekking up a mountain one day. It was a particularly large mountain, so it would take several weeks to climb it. He had climbed many mountains before this so he was not nervous. He had begun his expedition days ago. The mountain is snowy and steep. Being experienced he decided to trek this mountain alone. He had a watch with the time and date, yet the day did not matter to him alone on the mountain. The passing days were remarkably similar to each other. He would spot an animal occasionally, which combined with the snowy scenery would instantaneously make any hard work he had done worthwhile. Then, this process would reset and he would sometimes regret his decision to put himself through such physical labor until the next exhilarating moment came to make it worthwhile. He would have human contact at rest camps. He did enjoy speaking with someone occasionally, yet was not able to form any sort of connection during the short while he knew him or her. Certain colder or windier days were agonizing while others were amazing. On day 24 of the climb there was a minor landslide on the summit he was on. Luckily, he was not injured. On the way up the mountain, he saw traces of climbers that were there before him. The high altitude caused lower pressure and he had a harder time breathing the further he got up the mountain. He had to drink water more often and had less and less energy to marvel at scenery. This was perfectly natural to him, and he in fact craved it. He associated this feeling with the leading up to an accomplishment. His first trek as a child was difficult yet he always remembered the sense of accomplishment he felt at the tip of the mountain, like he was standing on top of the world. His remembering of this feeling, and its renewal every time he completed a trek, kept him going during the harsher days. He found he could not invest a large amount of time in other activities, so his most fulfilling moments took place on mountaintops. He sometimes wished he hadn’t found his passion so early in his life because he knew he wouldn’t be able to match the feeling he had experienced climbing his first mountain. On day 36 of the hike he reached the second base camp. He noticed the snow after this point became fluffier and it became more difficult to walk. As he continued it became more difficult to breathe, yet the scenery became more beautiful and the moments of exhilaration increased in intensity. Unfortunately, most of the time he was not able to stop moving and enjoy any view, as the weather was too harsh. This never bothered him; he knew the true sense of accomplishment would come at the top of the mountain, not through any of the grapples and climbs along the way. Nearing the top of the mountain there was little wildlife or plants. He would see the occasional pine but other than that all the scenery would come from his view of everything down below. After departing the third camp the face of the mountain became a steep jut upwards. It was dangerous and quite rare for some one to try to climb without a guide or any companion. Nearing the tip of the mountain he attempted to take a less used route with a longer climb instead of the more commonly used route of multiple shorter climbs. As he was climbing his harness became loose and he fell to his death.

 The Racetrack 

There was a horse race going on at the local racetracks. The weather was temperate, and the man had bet fifty dollars, as he did every Sunday, on his cousin’s horse; which his cousin repeatedly referred to as ‘Maximilan’, yet which the man knew as no. 3. The man had won with this horse only twelve times out of the counted forty-three times he had bet on it. However, he was not concerned with the money involved in it and would come to races as part of his life routine. His cousin was involved in this hobby of his by chance and the man bet on his cousin’s horse because they were related and he wanted to be courteous. On the other hand, the man’s cousin attempted to make a living from his racehorse and was always distraught after a lost race. They would usually talk after a race, which to the man was becoming a burden as they would almost always be abrupt and unpleasant exchanges. The days the cousin did win, although rare, would cause him to be in remarkably high spirits. He would perhaps ask the man out to dinner, often having him pay and reminding him that he made money off of his horse. “That horse really brought it today” would always be said at some point during the meal. On that particular day the horse was doing quite well until it suddenly couldn’t run anymore and fell over, propelling its jockey forward and tripping a horse behind it. The man became unsettled watching this as he was not hoping for anything unforeseen to happen at these races. The officials weren’t sure what to do and one could tell from the hesitant way they stopped the race and called a vet over to examine the horse that they had never had this happen before. After a moment of half hearted anticipation from the audience, the horse was declared dead. The man was now startled, and worried for his cousin, who would most likely be watching, in shock at his bad luck. The man’s instinct was to leave; he was sure talking to his cousin would ruin the rest of his day completely. As the man was walking away from the racetrack his cousin came walking swiftly up to him. It was difficult to tell his mood based off his expression, yet it was not anger. They talked for a while, the man choosing his words carefully. It seemed his cousin had decided the horse would have to have died at some point and at least he wouldn’t lose any more money because of it after it died. His reasoning didn’t make much sense to the man but he would not suggest anything because he couldn’t do anything to help the situation. The man would continue to attend the races, yet the death of his cousin’s horse would force him to bet on another. The man and his cousin parted ways, after discussing getting into the habit of seeing each other if they wouldn’t at the race tracks. The man walked home and his cousin went back to the racetrack. Three weeks later the man received word of his cousin’s suicide.

The Life of Iron

The iron is nestled within the earth. It is part of a whole, abundant, unbroken and has been laying there for a long time, shifting only slightly on occasion. It is connected with other substances, various minerals, which it views as a part of itself. Time is not considered by the iron, neither is light, it considers only its place within the ground and its place as a part of an unbroken whole. Its physical body does not begin or end, yet it is aware of its place as a fraction. Suddenly, this whole is broken, and the unity that it had experienced so powerfully for so long becomes impossible to imagine. It has discovered a physical body, there is no more confusion about its place, and where its consciousness is contained. The iron does not realize it has been separated from itself, like an amnesiac doesn’t realize he's forgotten something. It is heated up, it experiences pain for a moment before the remaining compounds it is attached to give way and it is left alone. The iron is now packed with other pieces of iron into something moving, it does not know what. Although the iron is next to other pieces of iron, it is not connected to them like it was in the ground. They are taken to a construction site and unloaded where they will be used for the foundation of a building. Again they are smelted, this time they are bent to whatever shape is needed. Some are placed within the ground as the foundation, others are thrown away as scrap metal. These scraps must be transported again, now weaker and more broken, to be used in various ways. The iron used as foundation is comforted by the ground yet is forced to remain there without any other iron. Although it remains in the ground like it began, it is placed there unnaturally and instead of a constant unity it only feels anxiousness for change.  

Old Money, New Money & Everyone else

Society has varying levels of social class. Throughout history wealth has been considered the defining factor in whether someone is considered upper, middle or lower class. Usually someone born into a family with money, or 'old money', will receive a good education and in most cases will live their entire lives with financial stability and connections to prestigious institutions and families. In my eyes people with 'old money' are the ones that 'lucked out', as they did not work to acquire their wealth, yet were simply born in to it. People that are considered 'new money', such as Gatsby in The Great Gatsby, usually need to work to acquire their wealth, which in my eyes makes them more deserving as they did something to earn it. Although, people with 'new money' are portrayed as being of a lower class (in The Great Gatsby at least) because they flaunt their belongings and wealth more, and perhaps don't have the same connections as someone born into a family with 'old money'. People with 'old money' do not feel inclined to show off their money as it is something they are used to, and have always known. This refinement is what makes 'old money' of a higher class. Everyone else is everyone that does not classify as 'Old Money' nor 'New Money'. Although, many people in this category may still be of a high class they were not born into a wealthy, prestigious family and have not acquired wealth by some means of their own. There are different classes within the category of 'everyone else', and therefore it should not be generalized as its own grouping. For example, not everyone who attends an Ivy League school, or any college for that matter, has 'old money' or 'new money', yet they are of a relatively higher class than a lot of the population.

I Am Thankful For

I am thankful for Devin O'banion from our english class. Devin's super nice and it always brightens my day when i see him in the hallway or division. He contributes very insightful and thoughtful comments to our discussions quite often, with just a taste of humor to keep it interesting. He gave out mini donuts the other day which should hint at how nice and generous he is, which were delightfully rich and soft i might add. He's one of the best dressers i know hands down, plus easy on the eyes which is great cause i have a desk facing his. We've known each other for a while now and we have two other classes together besides english, division (which some might not consider a class) and gym plus we do soccer together, so i think its safe to say we'll enjoy many shenanigans together over the course of high school and this year. So Happy Thanksgiving!

I Celebrate Myself

Every person has their own, unique outlook on life; i believe view varies from person to person in at least one way, small or large, which is ultimately what makes an individual. I personally try to have an optimistic view on life. I don't necessarily have a specific philosophy, but i do think people should do what they can to make themselves, and the people they love, as happy as possible. If someones lives there life doing something they hate, they're unhappy and have not taken advantage of what life has to offer. Therefore i think its important for people to do what they love, whether it be teaching or exploring natural beauty, like we saw in "Into the Wild". This doesn't mean do whatever you want, as some rash decisions can severely, emotionally damage those around you such as your family (unless you truly believe it is justified). Loved ones such as family are important as they're emotional state significantly affects you, and it is important to do what you can to make them happy as well. An ambitious person might have to work harder to attain the same level of happiness as someone less ambitious, which is good as it contributes more to other people usually. But if someone is happy doing less, and finds beauty in other things, it usually means they can live happy more easily.

Poe

Edgar Allan Poe is regarded as one of the most significant, influential and intriguing authors of all time. It's safe to say he's a good writer, but there are plenty of good writers that don't even compare to Poe; so what is it that makes his writing so strikingly unique. Aside from his exceptional writing talent, Poe worked using true inspiration, a factor that many authors simply dont have. Within three years of Poes birth in 1809 both of his parents died and he was adopted by foster parents who attempted to force him into the tobacco business, instead of pursuing his dream of being a writer. He was mistreated for most of his life growing up, and his foster parents died when he was still young and struggling to publish, leaving him nothing. Poes first love married another man, and his wife of 2 years died of tuberculosis, the disease that had already claimed his mother, foster mother and brother. Armed with such dark experiences Poe became a revolutionary gothic writer. I believe his success stems from the horrors throughout his life, and his incredible ability to express his emotions in the form of his written works, instilling fear and dread in the reader. In Poes "the raven" he creates a mysterious and frightening aura as he touches on death and the supernatural. Few authors are able to create such a legitimately eerie aura, which is what makes Poe so great, and a pioneer of gothic style writing.

What Is An American?

I am not in a position to discuss what defines someone as an American, as I don't consider myself to be one. Having moved here from Canada 4 years ago I still don't believe i'm in a position to call myself an American; so if someone were to ask me "what am I", in any connotation, I couldn't answer ,"An American" (as i have not yet gotten a citizenship or really think of myself as an American). Having said that i think the right to call yourself an American, like any third world country, stems from your allegiance to the country, and perhaps involved practice of its political/social habits and agenda. A citizenship doesn't account for a lack of involvement with the country you live in, and to truly be able to call yourself an American i think you must show some sort of contribution to the country, and the society you live in. An American, in their daily life, must make an acknowledgement to the rules and morals the country was built on. He/She shouldn't take for granted the abundant rights American forefathers fought to instill, and make sure others are not oppressed in any way. An American should appreciate the exceptional diversity and opportunity that is America, and use it to their advantage to further the growth of the country as a whole through study and profession. Someone who has been living here their whole life may not identify themselves as an American, yet someone who has moved here only a few years ago may consider themselves an active member of the country, and i believe they have a right to. It ultimately is a state of mind that is important in being an American.