NationStates Jolt Archive

How do libertarians propose to allow the free market to step in for Utility companies? Isn't it impractical to have multiple power, water, etc, companies in an area providing their services through different pipelines/wires?

Also, how can laissez-faire capitalism enforce competition in an area where the upstart costs are extremely high? In some cases, it is possible for competition to readily spring up as the cost to do so is cheap. Take the automobile industry, for example, dominated by three giants, how is competition supposed to even get a start in that situation?

How do libertarians propose to allow the free market to step in for Utility companies? Isn't it impractical to have multiple power, water, etc, companies in an area providing their services through different pipelines/wires?

Also, how can laissez-faire capitalism enforce competition in an area where the upstart costs are extremely high? In some cases, it is possible for competition to readily spring up as the cost to do so is cheap. Take the automobile industry, for example, dominated by three giants, how is competition supposed to even get a start in that situation?

Most jurisdictions that have experimented with utility competition have done so by requiring the currently dominant company to mainain existing infrastructure and allow competition to use it for a fee. It has worked nominally well. Other experiments have involved creation of competition by opening new power plants and forcing existing infrastructure companies to act as delivery services.

Most interesting (from a free-market perspective) has been the rise of cable television, telephone, and high-speed internet competition. I know that personally I can choose from six different telephone providers, close to a dozen internet providers, and two tradtional cable providers.

I think it is important to note that there are very few (if any) truely "private" utilities in this country. The vast majority of utility companies operate under such significant regulation that they are basically publicly controlled entities with private shareholders. Creating competition in the utility market is essentially a matter of working out the infrastructure issues and allowing different buisness models to battle for customers.

A variety of means, actually. You own your own piece of infrastructure, provided as part of purchasing your house, and hook it up with the provider of water/gas/electricity.