Hazlett in Chicago Tribune: Product Differentiation in Action
In a Chicago Tribune column, Professor Thomas Hazlett comments on the array of choices and prices consumers now enjoy thanks to increased competition in the marketplace.
"If you want to see product differentiation in action, go to PetSmart," advises Hazlett. When he visits that store to purchase the treats demanded by his German Shepherd, Girlfriend, Hazlett says he peruses aisles filled with food "for puppies, for old dogs, big dogs, small dogs, healthy treats, diet treats, multiple flavors of everything."
The column's author cites today's willingness of corporations to go to great lengths to please their clientele as proof that a free-market economy serves the interests of ordinary people.
How the consumer became king, The Chicago Tribune, November 29, 2012. By Steve Chapman.
"Producers once reigned supreme. When I took economics in college in the 1970s, my instructors continually highlighted the danger of large firms that could restrict production to keep prices unreasonably high. This was often taken as proof of the need for strict government regulation.
"Monopolies and oligopolies were seen as a constant threat, and with some reason. In one major industry after another—cars, steel, oil, telecommunications, computers—there were only a few relevant firms, and they divided up growing markets without much fear of competition."