So Luxottica is just a pseudonym for Mafia

*news *money

*60 minutes: tsk.tsk.tsk.tsk.tsk.tsk.tsk....

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Are they bypassing monopoly laws or do these laws not exist in Italy and EU?

They didn't have a problem going after Microsoft so one wonders why Luxottica gets a pass.

While I don't approve of a company getting this powerful, I don't get why they are so upset about it.
It's an effective method for making lots of money(not unlike the methods employed by i.e. Apple); it's pure capitalism. And capitalism is awesome (according to lots of vocal americans).
So this gives me the impression that maybe they are upset about it because it's not an american company fucking over the world, but an italian company fucking over americans.

That's it. I'm making sure all my future glasses are from CostCo.

i'm not a big fan of wal-mart, but I need to re-up my glasses. Thank you for posting this!

Economics 101 will tell you monopolies and anti-competitive behaviour is market failure.

I knew a lot of Italian companies are quasi-monopolists in certain niche markets, but this was news to me. Cheers!

Being a monopoly or a near monopoly is not something that automatically makes a company detrimental to society.

What matters is if that monopoly was established with some kind of violence, or by pulling strings in Washington for political favors.

I don't see Luxottica doing any of that.

America is destroying its own business environment, I'm not surprised when american companies are gobbled up by foreign multinationals.

@RedSky if anti-competitive behaviour automatically equals market failure, are you saying worker unions are bad for the market? Because I wouldn't, I think unions are quite useful.

Good to know, I've been wondering why out of pocket cost has been going up and up over the last few years for the same cheap frames. After insurance, I'm still paying hundreds of bucks for the sh!tty frames and crappy lens options.

F!ck this company, I'll go to the other monopoly if I have to - WalMart!

That bald guy denies everything. If you said "Anna Kournikova was pretty hot back in her day", he would reply "Iiiiii... would not say this was true." Sleazy douchestick.

What's always bothered me is that it's easy and legal for monopolies to hide the fact that they are as big as they are by having as many brands as they wish. If Luxottica were forced to have their name anywhere on their product, even in addition to the other brand, customers would see that and some would naturally start looking for alternatives. Same goes for mega media conglomerates.

When did brand names costing excessive amounts of money become shocking?

You're not paying for who makes it or how it's made or any other basically irrelevant detail. You're paying for the privilege of wearing their logo.

Luxottica still doesn't own the brands, tomorrow (or after contract) all these brand could decide to let Walmart make their glasses. Don't kid yourself to think these glasses would be any cheaper with "competition" though, Chanel isn't new to the game of charging more than cost, they would not operate any differently regardless if they made the glasses themselves, in fact since nobody can match Luxottica in operations, prices would probably go up.

Who says Luxottica even sets the prices, this was not sufficiently investigated. If Luxottica sells its services to the brands at set prices and the brands themselves set the RRP, this loses a lot of meaning.

Does this mean Luxottica is operating in good faith and are gentle souls? Hell no, it is a pretty dire situation. I just don't believe it would change in any meaningful way if there were more manufactures. What would change is how much Chanel has to pay to get their glasses made, it wouldn't do shit to change what we pay.

*Chanel = Any brand.

I ordered my current glasses from an online store from canada for $7...with my prescription. It also lets you get out of the racket where they demand a new eye exam every year.

Comment hidden because you are ignoring dag.(show it anyway)

The last glasses I got, before I had Lasik™ were from 39dollarglasses.com and they were not bad ... http://www.39dollarglasses.com/

Comment hidden because you are ignoring dag.(show it anyway)

This is exactly right. If you believe in the free-market you should be anti-monopoly and OK with governments breaking them up for the the benefit of the market itself. Seems contradictory but it's true.

If labour laws are enforced equally within borders, unions don't affect competitiveness one way or another. Internationally, yes there will be differences in application but in economics, competition usually relates to abuse of market power in oligopoly or monopoly structures rather than the converse.

More specifically, monopolies create the incentive in most industries to withhold output to levels of sub-optimal demand by raising prices. This maximises revenue for the firm but limits societal benefit derived from the good or service being produced, creating a deadweight loss of value. In a more competitive environment, competitors would increasingly put pressure on prices downwards until the optimal, larger output level was reached. Wiki has a decent summary here:

http://en.wikipedia.org/wiki/Monopoly#Monopoly_and_efficiency

Therefore while the existence of monopolies is not always harmful, say in the case of utility infrastructure owning firms, where otherwise you would have unnecessary duplication, monopolies are almost always detrimental unless sufficiently regulated.

Of course, right wing US politics portrays free market economics differently, but as you well know, the intention there is to create a false theoretical narrative for whatever special interest they are paying dues to rather than being truthful about the facts. As I said, none of this would at all be controversial in a university/academic setting.

@RedSky when you accuse different opinions of special interests, it makes you seem unaware of the special interests in your own opinions. I want to address some statements you made.

If putting downward pressure on prices is always desirable, aren't you just thinking as a consumer and specifically in regards to goods? If downward pressure is put on, say, the price of wages or services, would that be desirable for workers or servers?

Saying unions don't affect competitiveness, makes me think you're missing something fundamental about the nature of unions: workers coming together so they can keep the price of their wages and benefits above what companies would pay them if they were competing with each other instead. That's anti-competitive.

Is that good or bad?

Neither. You see, that's the problem with bad economics: trying to assert that something is good or bad, without taking into account all the groups involved, without considering all the angles.

Unions are usually bad for companies, but they're good for workers. So, are unions bad for competitiveness? YES, they obviously diminsh competitiveness among workers. Is that a failure of the market? NOOOO, the market is not failing there. People don't always have to compete, they should compete when they should, and shouldn't when they shouldn't, it's up to them to figure it out.

There is no "compete as much as possible" rule to make a market work. Competing also wastes resources, you know? Otherwise no one would ever see a benefit in cooperating instead of competing all the time.

Well, just wanted to let you know that I disagree.

Thinking that markets only work when there is "perfect" competition is a common misconception.

Well, as far as I know, I don't have any corporate sponsors that are financing the dissemination of my opinion for their own interests ... that I know of?

Hold on, you're twisting my words. I'm making a statement of social science, not of ethics. I'm not in the mood to argue ethics, generally have a mixed opinion, and don't like discussing it since it becomes purely an emotional argument.

On a theoretical basis, you would say in the market for labour, competition pushes labour costs down to their equilibrium demand/supply level. If there are a shortage of skilled workers for an X industry or skill set, the price or wage goes up, or vice versa. That's why you typically see union structures in less skilled or more standardised rather than specialised job types. Those, with a high quantity of people possessing said skills for the job.

But as always it's a trade-off. If firms in a particular industry or skill subset start paying too little for their workers, less people will decide to study it, and they will miss out on the talent and skill pool of those who were incentivised into other industries. On that basis unions aren't necessarily good or bad for industries.

On a personal level, I'd say that there is nothing fundamentally wrong with unions and they make perfect sense. Firms organise themselves into trade associations and it would be naive to say that they don't share information on wage levels, or for that matter that this kind of information is not freely available. Why shouldn't the counterparty in the so-called market for labour not be able to organise themselves equally?

As for your last comment on whether competing is always necessary, I tend to have a pretty cynical view of the world and believe that people are generally consciously or subconsciously acting in their own interests. You may point out altruism and I will say people are satisfying a innate biological need to help others, a characteristic that would have come about in our cavemen days when co-operating distinguished your survival ability from other tribes, but ultimately something motivated in you by the evolutionary survival advantage that it conferred to you rather than any pure form of altruism.

Economics as a theory of study is pretty much predicated on this notion. What is the extent of the truth of this in reality? Who knows. I have little ability if any to truly glance into the mind of what anyone else is thinking or what motivates them.

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