Introduction

Business is the activity of making one's living or making money by producing or buying and selling products (such as goods and services).[need quotation to verify] Simply put, it is "any activity or enterprise entered into for profit. It does not mean it is a company, a corporation, partnership, or have any such formal organization, but it can range from a street peddler to General Motors."

Having a business name does not separate the business entity from the owner, which means that the owner of the business is responsible and liable for debts incurred by the business. If the business acquires debts, the creditors can go after the owner's personal possessions. A business structure does not allow for corporate tax rates. The proprietor is personally taxed on all income from the business.

The term is also often used colloquially (but not by lawyers or by public officials) to refer to a company. A company, on the other hand, is a separate legal entity and provides for limited liability, as well as corporate tax rates. A company structure is more complicated and expensive to set up, but offers more protection and benefits for the owner.

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Richard Cantillon (1680s – May 1734) was an Irish-French economist and author of Essai sur la Nature du Commerce en Général (Essay on the Nature of Trade in General), a book considered by William Stanley Jevons to be the "cradle of political economy". Although little information exists on Cantillon's life, it is known that he became a successful banker and merchant at an early age. His success was largely derived from the political and business connections he made through his family and through an early employer, James Brydges. During the late 1710s and early 1720s, Cantillon speculated in, and later helped fund, John Law's Mississippi Company, from which he acquired great wealth. However, his success came at a cost to his debtors, who pursued him with lawsuits, criminal charges, and even murder plots until his death in 1734.

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A vintage travel gear seller at Marché Dauphine, Saint-Ouen, the home to Paris' flea market

A flea market (or swap meet) is a type of bazaar that rents space to people who want to sell or barter merchandise. Used goods, low quality items, and high quality items at low prices are commonplace.

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"Production Cloning

On the supply side, the ultimate source of a mass winner-take-all market is that the services of the best performers can be reproduced, or "cloned", at low additional cost. For example, once the master recording has been made, it costs no more to transcribe the best soprano's performance onto a compact disc than it does her understudy's. Once the film is in the canister, it costs no more to make an additional print of an Academy Award winner than a B western. Once the television cameras have been set up, it costs no more to broadcast a tennis match between the first- and second-ranked players in the world than it does to broadcast a match between the 101st and 102nd. If the best performers' efforts can be cloned at low marginal cost, there is less room in the market for lower-ranked talents.

More generally, whenever there are economies of scale in production or distribution, there is a natural tendency for one product, supplier, or service to dominate the market. The battle is to determine which one it will be.

Network Economies

On the demand side of many markets, a product becomes more valuable as greater numbers of consumers use it. A vivid illustration is VHS's defeat of the competing Beta format in home video recorders. VHS's defeat of the competing Beta format in home video recorders. VHS's attraction over the initial versions of Beta was that it permitted longer recording times. Thought Beta later corrected this deficiency and on most important technical dimensions came to be widely by experts as superior to VHS, the initial sales advantage of VHS proved insurmountable. Once the number of consumers owning VHS passed a critical threshold, the reasons for choosing it became compelling-variety and availability of tape rentals, access to repair facilities, the capability to exchange tapes with friends, and son on."

Robert H. Frank, The Winner-Take-All Society, 1995

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  • 1972 - Jon Fisher, a Silicon Valley entrepreneur, inventor, author, philanthropist, and economic analyst, was born on this day.

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