What Does Public Schooling Teach Us About Predatory Pricing?
10th March 2014
Among other things, it teaches us that the government routinely engages in behavior for which it would throw anybody else in jail.
Predatory pricing is one of the simplest business practices to explain: Sell at a loss until you bankrupt your competitors. When you think about it, public schools apply this predatory strategy to an extreme degree. They don’t just sell education at a loss. They “sell” education for free!
What can we learn from this epiphany? First and foremost, predation is a lot less effective than you’d think. After practicing predation to the utmost degree, public schools have only captured 90% of the market.