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I think you should hear more about the 1936 Robinson-Patman Act. It was passed during the depression to keep A&P from driving smaller stores out of business. What it says that if you offer discount to one vendor because there are real cost savings because they order by the truckload, then you have to offer the same discount to everyone. You can’t offer discounts just because they are your biggest customer.
This leads to the biggest retailer taking over the markets and muscling everyone else out because now nobody can compete. It hurts the distribution market as well. Additionally, if a customer is just too small, the distributor can just choose to not do business with the little guys. Once the competitors are all gone, then monopolistic pricing takes over and consumers loose.
The Regan Administration just stopped enforcing this law in the 1980’s. Since then it has caused a huge shift in retail, and I saw a recent story that this is the sole reason we have food deserts now.
Mr Regan, In many cases we need more government regulation because free markets don’t always work in the best interest of everyone.
The reason capitalism works is because the free market offers opportunities to become prosperous on your own terms. Sounds good, right? The problem with capitalism and free markets, however, is that as merchants become more prosperous, greed takes over. Left unchecked, that greed makes the entrepreneurs ridiculously rich while consumers get screwed. There is a reason for government regulations, the most important one being that they protect consumers and competitors from unfair practices. If Big Business was responsible and fair, there’d be no need for regulations. But, alas, greed is a powerful drug that cannot be ignored.