Friedman reversed the classical liberal claim that monopoly suppresses competition

Evidence

Unlike classical liberals who feared the political and economic effects of monopoly power, henceforth Friedman adopted a relatively sanguine attitude. Classical liberals expressed misgivings about the concentrations of power that monopoly represented. With his scope narrowed to economic considerations, Friedman countered that inimical competition curbed monopoly power. The compelling empirical data that had supposedly swayed his opinion was nowhere to be seen. Classical liberals had suggested instead that monopoly eventually suppressed competition. Director and Friedman turned this distinction on its head, asserting that competition eventually suppressed monopoly. — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1118

Categorization

• QUESTION: The author notes ‘the compelling empirical data… was nowhere to be seen’ — what motivated this reversal if not evidence? Pure ideology?
• SEED: Angle: the counter-factual claim that competition zaps monopoly — where did the evidence go, and why did it persist in Chicago doctrine for decades?
• XREF: connects to: Austrian economics redirected antitrust critique from firm monopoly to state and union restrictions — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 280; Friedman’s Capitalism and Freedom evaded engagement with opponents and defined away monopoly — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 794; Aaron Director in 1950 declared competition would destroy all monopoly absent government — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 1109 (+6 more)

Broader Connections

• Monopolies express competition rather than contradict it #expands (0.95) — Clara E. Mattei, Escape from Capitalism, 138
• Chicago neoliberals reversed course to treat monopoly as benign and rarely present #expands (0.90) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1120
• Neoliberalism inverted classical liberalism by defending monopoly and corporate power #expands (0.80) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 175