{"id":17716,"date":"2012-11-11T12:53:14","date_gmt":"2012-11-11T17:53:14","guid":{"rendered":"http:\/\/quotulatiousness.ca\/blog\/?p=17716"},"modified":"2012-11-11T12:53:14","modified_gmt":"2012-11-11T17:53:14","slug":"the-natural-lifecycle-of-a-monopoly","status":"publish","type":"post","link":"https:\/\/quotulatiousness.ca\/blog\/2012\/11\/11\/the-natural-lifecycle-of-a-monopoly\/","title":{"rendered":"The natural lifecycle of a &#8220;monopoly&#8221;"},"content":{"rendered":"<p>In <em>Forbes<\/em>, <a href=\"http:\/\/www.forbes.com\/sites\/timworstall\/2012\/11\/11\/the-chinese-rare-earths-monopoly-starts-to-fall-apart\/\" target=\"_blank\">Tim Worstall<\/a> celebrates the natural end to a &#8220;monopoly&#8221; &mdash; the quasi-monopoly of Chinese exports of rare earth compounds:<\/p>\n<blockquote><p>These past several years I\u2019ve been shouting to all who would listen that while China does indeed have a stranglehold on current production of rare earths that\u2019s not something that we really need to worry about. For the important thing about rare earths is that they\u2019re not rare (nor earths either). There are plenty of deposits around and we can get all we need from other areas of the world if we should care to.<\/p>\n<ul>\n<p><em>The same cannot be said of Kuantan, the Malaysian locale where Lynas plans to build a rare earth processing plant, a type of facility residents and Australian supporters say, in online campaigns, will result in \u201cmillions of tonnes of toxic radioactive waste left behind\u201d.<\/em><\/p>\n<p><em>Residents took Lynas to court in Malaysia, resulting in the suspension of its operating licence. That decision was overturned yesterday.<\/em><\/p>\n<\/ul>\n<p>Lynas is the company desiring to mine the Mt. Weld deposit (a nice rich one it is too). They are going to separate the RE concentrate at that plant in Malaysia. There\u2019s been a vocal campaign against the licensing of that extraction plant and Lynas has, as above, just succeeded in over-turning a previous license refusal. Once up and operating fully the plant should supply some 20,000 tonnes a year of REs. This is a substantial portion of demand outside China: it\u2019s some 15% or so of entire global demand in fact.<\/p>\n<p>And thus we again see how an apparent monopoly isn\u2019t really all that much use to the supposed monopolist. It certainly was true that China supplied 95-97% of the world\u2019s REs. Largely because they were willing to mine and supply at prices that made it not worth anyone else\u2019s while to do so. But when they tried to constrain supply, to exercise that monopoly, instead of being able to exploit us all they simply encouraged the competition that destroys that monopoly.<\/p>\n<p>Markets do indeed work and the only monopoly that can really be exploited is one that isn\u2019t contestable. And an attempted monopoly in something as common as rare earths simply is contestable and thus cannot be exploited.<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"<p>In Forbes, Tim Worstall celebrates the natural end to a &#8220;monopoly&#8221; &mdash; the quasi-monopoly of Chinese exports of rare earth compounds: These past several years I\u2019ve been shouting to all who would listen that while China does indeed have a stranglehold on current production of rare earths that\u2019s not something that we really need to [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[21,22,25,15],"tags":[656,469,661],"class_list":["post-17716","post","type-post","status-publish","format-standard","hentry","category-asia","category-china","category-economics","category-technology","tag-malaysia","tag-monopolies","tag-regulation"],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p2hpV6-4BK","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/17716","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/comments?post=17716"}],"version-history":[{"count":1,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/17716\/revisions"}],"predecessor-version":[{"id":17717,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/17716\/revisions\/17717"}],"wp:attachment":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/media?parent=17716"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/categories?post=17716"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/tags?post=17716"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}