The problem with competition is that it creates inefficiencies.
At first, this may seem counterintuitive, given that we were taught at school that the main benefit of competition is increased efficiency. After all, competition puts pressure on every company to produce goods and services at the lowest possible cost — in other words, as efficiently as possible.
However, evolutionary biologists point out that the basic principle is actually the opposite. Competition causes competitors to perform actions that would otherwise be unnecessary, and the fiercer the competition, the more unnecessary actions are performed, serving no purpose other than to defeat the competition. Examples include the peacock’s tail and lions tearing apart their young.
In economic competition, the effects are twofold. On the one hand, it pushes for the better use of machine time or better quality control. On the other hand, it leads to entrepreneurs denouncing and slandering each other, pushing for harmful regulations, or simply spending huge amounts of money on advertising. While machine adjustment and work organisation can only be improved to a certain extent, marketing costs are unlimited. The fiercer the competition, the more unnecessary costs there are.
Moderate competition is beneficial in many areas, but excessive competition can be detrimental to all involved.
