Mixed Markets II: Bees and Boots

Another odd sign, seen out and about in Harbin, although I don't know why it surprised me after puppies and potatoes. Stalls like this are all over the place, selling various wares or services, and often containing a little coal-fired stove to keep warm in winter.First up, a bit of Economic Geekery. Economic Theory suggests that when two related companies join up, efficiency gains can be realised. This can be via vertical integration (e.g. a shoe maker buying a leather company) or horizontal integration (e.g. a shoe maker buying another shoe maker).

If two unrelated companies conglomerate (e.g. AOL buying TimeWarner), economies of scale are likely to be smaller, but there are benefits in terms of capital allocation in imperfect markets, and smoothing out highs and lows in the two markets' business cycles.

This guy's been reading up on his Microeconomics. The two words to the left and right are 修鞋 or 'Shoe Repair'. On the glass, it adds 卖蜂蜜 or 'Sells Honey'.