Inspired by a front-page article in the January 27 Wall Street Journal, I decided to investigate this outrage. The U.S. washboard monopoly is a national disgrace. Here are the opening paragraphs from the Journal piece.
Economists immediately saw the problems created by a single seller. They chimed in.
Note especially the reference to musicians. I once knew an accordion player who annually made a pilgrimage to a musical saw get-together. Washboards are, of course, mainstays of some country music. But they are vital to Cajun tunes. Imagine how those poor musicians (redundant) are suffering under elevated washboard prices.
Scott Lincicome added this to the end of the thread:
The HHI referred to by Brian Albrecht is the Herfindahl-Hirschman Index. The U.S. Department of Justice describes it:
The term “HHI” means the Herfindahl–Hirschman Index, a commonly accepted measure of market concentration. The HHI is calculated by squaring the market share of each firm competing in the market and then summing the resulting numbers. For example, for a market consisting of four firms with shares of 30, 30, 20, and 20 percent, the HHI is 2,600 (302 + 302+ 202 + 202 = 2,600).
I’ll add that the market shares should add up to 100.
Since there is only one firm making washboards, their market share is 100%. And 100² equals 10,000. Dr. Albrecht’s arithmetic is correct.
For those unfamiliar with this device, here’s a sample of washboards.