It’s worth examining whether “capturing value” and “providing value” are speaking of the same thing. In many cases, the middlemen will claim that they’re actually providing the majority of the value, in making the underlying thing useful or available. They may or may not be right.
For most goods, it’s not clear how much of the consumer use value comes from the idea, the implementation of the idea, or from the execution of the delivery and packaging. Leaving aside government-enforced exclusivity, there are usually reasons for someone to pay for the convenience, packaging, and bundling of such goods.
I worked (long ago) in physical goods distribution for toys and novelties. I was absolutely and undeniably working for a middleman—we bought truckloads of stuff from factories, repackaged it for retail, and sold it at a significant markup to retail stores, who marked it up again and sold it to consumers. Our margins were good, but all trades were voluntary and I don’t agree with a framing that we were “capturing” existing value rather than creating value in connecting supply with demand.
All value is finite, and every time value is used, it decreases. The middlemen are merely causing the thing to die faster. For instance, if you discover a nice beach which hasn’t been ruined with plastic and glass bottle yet, and make it into a popular area, you won’t get to spend many happy summers at that place.
If you find oil and sell it, are you creating value, or are you destroying value? I think both perspectives are valid. But since the openness of information in the modern world makes it so that everything which can be exploited will be exploited, and until the point that exploitation is no longer possible (as with the ruined beach), I strongly dislike unsustainable exploitation and personally tend toward the “destroying value” view.
And if you want something to worry about, let it be premature exploitation. X ‘creates’ value and chooses not to exploit it prematurely, but then Y will come along and take it, so X is forced to capitalize on it early. Now you have a moloch problem on your hands.
It’s worth examining whether “capturing value” and “providing value” are speaking of the same thing. In many cases, the middlemen will claim that they’re actually providing the majority of the value, in making the underlying thing useful or available. They may or may not be right.
For most goods, it’s not clear how much of the consumer use value comes from the idea, the implementation of the idea, or from the execution of the delivery and packaging. Leaving aside government-enforced exclusivity, there are usually reasons for someone to pay for the convenience, packaging, and bundling of such goods.
I worked (long ago) in physical goods distribution for toys and novelties. I was absolutely and undeniably working for a middleman—we bought truckloads of stuff from factories, repackaged it for retail, and sold it at a significant markup to retail stores, who marked it up again and sold it to consumers. Our margins were good, but all trades were voluntary and I don’t agree with a framing that we were “capturing” existing value rather than creating value in connecting supply with demand.
All value is finite, and every time value is used, it decreases. The middlemen are merely causing the thing to die faster. For instance, if you discover a nice beach which hasn’t been ruined with plastic and glass bottle yet, and make it into a popular area, you won’t get to spend many happy summers at that place.
If you find oil and sell it, are you creating value, or are you destroying value? I think both perspectives are valid. But since the openness of information in the modern world makes it so that everything which can be exploited will be exploited, and until the point that exploitation is no longer possible (as with the ruined beach), I strongly dislike unsustainable exploitation and personally tend toward the “destroying value” view.
And if you want something to worry about, let it be premature exploitation. X ‘creates’ value and chooses not to exploit it prematurely, but then Y will come along and take it, so X is forced to capitalize on it early. Now you have a moloch problem on your hands.