82. "Competition is wasteful."
Some people claim that competition uses more resources, producing many variants of products where only one is needed. It doesn’t work that way because people have different tastes and values and prefer different products.
Producers rarely make products identical to those of their rivals, but will seek to emphasize a unique advantage possessed by their own. This allows customers to exercise their preferences for things like sweeter beverages, softer shoes or more stylish clothes. They can choose a car that is cooler, faster, or more practical, depending on their values. People express themselves partly through such choices.
If there were no competition, and people couldn’t choose between alternative products, some committee somewhere would have to decide which standard product would have a monopoly. It would be a duller world, for such a body would have to approve products to satisfy everyone, and could not possibly keep up with changes in fashion and taste, or with innovation.
Even in cases where competing products are very similar, competition forces producers to keep quality high and prices keen. If their customers can desert them for other producers, they have to pay continual attention to refinements and improvements, or risk losing their market share.
Competition uses resources more efficiently, not less. It continually steers resources towards those who are good at satisfying their customers’ needs, and away from those unable to provide them with goods of the quality and price that they seek. Those good at it usually prosper and expand; those who can’t satisfy demand lose out.
Without competition the consumer has little power. Producers can deliver indifferent quality and prices bloated by inefficiency, and still survive because consumers have no-one else to turn to. Competition forces producers to attend to consumer needs and to improve both quality and value.