#22 - Weaken

[Administrator]

Complete Question Explanation
(See the complete passage discussion here: lsat/viewtopic.php?t=14161)

The correct answer choice is (E)

To answer this question correctly, you need to weaken the causal relationship between increased size
and monopoly power outlined in the third paragraph:

Cause Effect

Increased size Monopoly power

In short, you need to provide a counterexample where increased size does not necessarily lead to
exerting monopoly power: a cause without effect.

Answer choice (A): This answer choice implies that large size is not necessarily a prerequisite for
exerting monopoly power within a given industry, because some businesses can exert such power in
one region even though larger, similar businesses exist in other regions. However, the author never
claimed that only the largest businesses can exert monopoly power: just because a smaller firm
can do the same does not weaken the argument. Furthermore, notice how the smaller businesses
described here are located in a different geographical region from the larger ones. If so, the smaller
businesses may not even be subject to the same competitive forces as those that are expected to drive
them out of business.

The example provided does not help evaluate the relationship between increased size and monopoly
power, making answer choice (A) incorrect.

Answer choice (B): This answer choice describes a situation where increased specialization of labor
(a by-product of increased size) erodes workers’ ability to command a high salary. Unfortunate as
this effect may be, it surely does not prevent the business in question from becoming a monopoly.
The salary workers are able to obtain has no bearing on the issue at stake.

Answer choice (C): This answer choice suggests that an industry dominated by a few players can
have the same effect as a true monopoly, which only strengthens the argument that increasing returns
create a natural tendency toward monopoly.

Answer choice (D): It is irrelevant whether different industries vary in terms of how large a business
must be in order to benefit from increasing returns to scale. The author never claimed that increasing
returns can only be achieved once a certain uniform “threshold” has been reached.

Answer choice (E): This is the correct answer choice. Here, increased specialization of labor does
not lead to increasing returns to scale, because gains in productivity are offset by higher training
costs and turnover. This undermines a key economic assumption of the Pin Factory model, and
makes it less probable that larger firms would achieve the efficiency necessary to drive smaller firms
out of business.

[LSATls]

I understand why E is a good choice -- having narrowed down my answer choices to E and A, however, I ended up selecting A, and I still am not quite sure why A is incorrect.

In the explanation above, it is stated that "the author never claimed that only the largest businesses can exert monopoly power: just because a smaller firm can do the same does not weaken the argument." While this is true, and while a smaller firm creating a monopoly does not undermine the "if large, then monopoly" conditional stated in the passage, answer choice A does seem to undermine the conditional by telling us that a larger firm does not always lead to a monopoly. In the scenario A presents, there is a larger firm not putting a smaller firm out of business (since the smaller firm has gained a monopoly hold on the region). The author never says that "only the largest businesses can exert monopoly power," but the author does say that "bigger firms tend to drive smaller firms out of business." Answer A presents a scenario where that isn't true.

In other words, it seems like the explanation provided above incorrectly focuses on the fact that a smaller firm has gained monopoly power, but the important point implied by A is that there exists a larger firm that does not drive a smaller firm out of business (the nod towards geographical location is irrelevant, since the passage talks about firms within the same industry, as does answer choice A). The only thing I can find wrong with A, then, is that the author only mentions that larger firms tend to put smaller firms out of business, in which case the fact that there are a few instances of this happening does not necessarily undermine the author's point.

[Jeremy Press]

Hi LSATIs,

I would dispute you on one comment in your otherwise very excellent close read of this question. You said, "the nod towards geographical location is irrelevant, since the passage talks about firms within the same industry, as does answer choice A." The mention of geographical location is neither irrelevant nor accidental in answer choice A. The passage discusses in a simple way the relationship between size and monopoly power in the same industry, without referring to factors that might complicate the analysis. So, the passage makes it impossible to evaluate whether regional forces (and the possibility that some markets in certain industries might not be "supraregional") would be expected to result in different outcomes. Since the passage's argument doesn't discuss that specific issue, it's impossible to know whether the author would consider it a supporting example or a counterexample. Without knowing that, we should not make too much of answer choice A. It does not have as direct, or pronounced, an effect as answer choice E, which directly targets the explicitly-discussed assumptions of the Pin Factory model.

I hope this helps!

Jeremy