comment: >
  
  That reminds me the quote as 'democracy is a bad system, only all others are even worse.
  Without referring to your example, there are several problems. One is that in an advanced economy nobody has an idea what is efficient and what is not. Should you use copper for cabels? Metal? Gold? Some of these are more rare, some of these have better conductivity, some are harder to work with. Should you plant 100 apple trees and 50 pear trees or something completely different? Where should you spend your valuable time in order to efficiently produce what the 'society wants'?
  How do you figure out what the society wants? You need price system. Which means reasonably free markets. See Mises & problem of socialist computation.
  Suppose you have the 1 company C which produces widget X. And now suppose you have a great idea how to produce widget X more efficiently. But maybe the people deciding about how to produce widget X are not very open to changing the technology. Maybe they fear losing a job. Maybe they are just stupid. Or maybe your idea is stupid.
  When there's competition, you can start competing against company C. And maybe your idea was great. And maybe it wasn't. But the incentives are aligned in a way, that more often than not if you really had a great idea, it would be tried. Without competition, you get corruption, brotherhoods, winks... 
  Yes, the competition does have some costs. But it does have enormous benefits.
context: So, the time to develop the product would be N*2. That is a halving of the speed of development.
  
  This isn't actually how development time usually scales, but even if it were, the problem is why are any of these people developing anything? Are they being paid? By whom? And why? What are the peoples motivations? It's very easy to imagine 50 highly motivated people working faster than 100 unmotivated people. You can come up with all manner of critique of capitalism if you want, but we can at least describe the motivation as those people are competing for profits. You talk about "halving the speed of development", but halving only makes sense if you're comparing the system to something else. But what are you comparing it to and how do you account for those hypothetical workers' productivity? >
  
  I don't think I understand your example.
  If you have 2 companies with 50 people each, wouldn't you end up with twice the amount after the extended time? There really is no slowdown - perhaps a lack in flexibility, but not in creation of goods.
  Unless, of course, you're talking about purely scientific developments - which really can't be scaled like that to begin with... >
  
  It is one of the most nonsensical CMVs I have seen so far...it even fails to consider capitalism. There are many economic models with competition that are not capitalistic. >
  
  You're missing a huge part of the equation: what happens to the commodities after they are produced, and how much of the commodity should be produced?
  An essential concept of economics (and human behavior) is that more is better than less, but that everything exhibits diminishing marginal utility. For a concrete example, it means that two pieces of cake is always better than one piece of cake, but the second piece of cake will be less valuable than the first piece of cake (ie. once you start getting full you don't want cake as much). However, each piece of cake costs the same, so even if the first piece of cake is worth less than the cost to purchase it, eventually the value of the Nth piece of cake will be less than the cost of a cake and so you should stop buying cake.
  In your example you've implicitly assumed that 1 commodity every N hours is preferable to 1 commodity every N*2 hours, but because of diminishing marginal utility once you factor in costs this may not actually be true. It could be that the optimal amount of commodity is actually 1 every N*2 hours, in which case the remaining 50 people should actually be working on a different commodity.
  A second concern is that if all 100 people work on making the commodity, it will actually be in their best interest to not work as hard as they could, because by working less there will be less of the commodity on the market, which means they can sell each commodity for more, sacrificing only a little money for leisure time. This is an example of monopolistic behavior.
  Capitalism (with competition) addresses these concerns by making sure the amount of the commodity that gets produced matches the optimal amount of the commodity that people actually want and are willing to pay for. >
  
  When people say markets are efficient, they mean they are efficient at solving the economic calculation problem. That is, markets efficiently can allocate the proper amount of  resources to produce a proper amount of supply and set fair prices. 
  In an artificial example where the number of companies, experts, and so on are artificially fixed, no system can ever be maximally efficient, except by serendipity. 
  In the real world, a market economy may respond by incentivizing the production of new experts or by one of the companies losing and being absorbed by the other. 
  "But, wait", you might say, "that still doesn't solve the issue of sequestered parallel development, because obviously competition exists in real market economies. Isn't that just wasted development?" Yes and no. There is waste in redundancy, but there is also value in it. Competition to meet demand is what allows for markets to be efficient at the economic calculation problem. Open markets solve this issue through a complex network of actors addressing their own local needs and abilities to satisfy others needs. The alternative, a centralized monolithic agent that tries to efficiently guess the needs to distributed actors and meet them in a fair way is incredibly hard, leading to other inefficiencies, and prone to abuse. Hence why we generally don't like monopolies. 
  The reality is that no system is without waste. You can't have your cake and eat it too. Free markets are not perfect, no system is, but they are efficient. >
  
  Yours is the best response I've seen so far, but there are a few bits I'd like to add.
  OP is focused on "efficiency" in the sense of a cost:value ratio for research and manufacturing. While the idea of doubling your efficiency by doubling your workforce is exaggerated, the core idea isn't wrong. Monopolies have the ability to be far more efficient (in that one, limited sense) than dispersed efforts.
  But monopolies are almost universally recognized as inefficient from a societal standpoint. The cost savings they receive from their market power are offset by the deadweight loss from their demands for higher profits. And their ability to command those higher profits provides a disincentive to innovate. Why be more efficient if you can profit regardless? 
  And if a company has no reason to be more efficient, chances are it won't be. The effort and expense required to build that efficiency is unnecessary, which makes the process of becoming more efficient paradoxically inefficient. >
  
  One thing "the market" does is do a good job at setting incentives.   If company A is better than company B at developing nestling, it's generally given positive feedback which helps enable it. 
  OK, so let's use your scenario.  A and B are both trying to develop X mk1.  For whatever reason,  A wins,  develops X a few months before B.
  Consumers notice, wow, X is cool!  I will pay more because X is better.
  A has increased cash flow, poaches some R&D employees from B.  A has 60, B has 40.
  But A fucked up.  Ooopsie.  Hired prima Donna self important prices who fucked up. B, now streamlined, beats A in X mk2, gets market share buff...
  The thing about "the invisible hand", (wiki it plz) is that it automagically selects for efficiency.  And I mean efficiency in the economic sense.  Better/best stuff for less inputs.
  I'm no capitalism absolutist.  There's a whole raft of problems that aren't addressed well or there are powerful interests trying to make them worse.   A market is efficient when it is competitive.  Lots of dickishness  seeks anticompetitive stuff.
  Your example is kinda over simplified BTW.  What if it's 10 companies, with 10 employees each, but they're all pursuing different "innovations".  The market selects for the "best" innovation, no matter what it is. 
  What if it's 100 companies, all doing different things?  People need say 5 products from the 100 companies but different people prefer different mixes....
  What if it's 1000 companies, people consume 50 different mixes, etc.
  A competitive market delivers the best in a complex system. >
  
  
  That is a halving of the speed of development.
  
  No, it's setting the pace of development. You're assuming that it's taking place via another means - it's not.
  You're making the argument about two timber trucks passing each other on the highway. Why are they taking logs one way when logs are coming from there already? You see that as inefficiency - when reality already deemed it to be efficient. 
  Are the logs identical? Probably not. Probably different types of trees. Do they need to be dried or not? Are they being used for industrial means or commercial? Maybe residential? It it being cut in a particular way for a particular use-case?
  Your argument relies on having a concrete 'end' that is being measured to judge 'efficiency' but you're ignoring the entire means that actually make up that efficiency in the first place. >
  
  I'm not assuming anything. I'm telling you how it currently is. Like, the facts. 
  Our current structures divide the talent into competing pools were information is siloed and not allowed to transfer. So, development ideas take longer to come by.
  > You're making the argument about two timber trucks passing each other on the highway. Why are they taking logs one way when logs are coming from there already? You see that as inefficiency - 
  That's not the same thing at all. So you can take it there, but that only makes me think that you missed the idea I was floating.
  > Your argument relies on having a concrete 'end' that is being measured to judge 'efficiency'  
  Again, no.  But, in capitalism, we do have an end goal anyway; that's the commodity that we bring to the market. >
  
  
  Our current structures divide the talent into competing pools were information is siloed and not allowed to transfer. So, development ideas take longer to come by.
  
  This is a non-sequitur.
  Your conclusion does not follow from the premises. >
  
  Compared to a hypothetical perfect system yes.  But it's much more efficient than feudalism, mercantilism, socialism, corporatism, or any other system we've tried so far. >
  
  
  or any other system we've tried so far.
  
  Citation needed.  There are plenty of Social Democracies that have state run programs that outperform "purely" capitalist ones.
  An easy example would be the US health care system, which costs more per person for the worse overall levels of care than pretty much every other developed economy.  The one exception at this current time would probably be the UK, which is suffering from years of Tory leadership pushing austerity measures which have substantially affected their public health system. >
  
  Those social democracies are all Capitalist, making one thing (healthcare provision) government run doesn't make an economy non-Capitalist. >
  
  It's not just healthcare - there are nationally run airline companies, nationally run Oil companies, nationally run public transit, and so on.  All of these tend to give better service at cheaper prices than their US comparisons.
  Many of these things the average person would call "socialist."  So we have to define terms here - are you using these phrases with their actual meanings, or are you using loaded language to refer to systems that have been branded certain terms without actually being them?
  If we're using the actual definitions of these words, then most that you listed are forms of capitalism, and have many real world examples.  Using them to say "these failed" but "capitalism is still going" is non-sensical, as they currently exist (in varying degrees) within our current capitalist society.  
  Feudalism, meanwhile, isn't really an economic system, but a social one - and it failed for social reasons.  
  Socialism tends to be a boogeyman, but there have rarely been real-world examples of them, and thus saying it's inferior because it's been tried before is not really a solid argument.
  Your argument sounds more like a half-thought, oft repeated adage rather than something true.  Plus, you acknowledge that publicly run services don't make an economy not-Capitalist, so why can't we impose strict restrictions on capitalism to ensure it doesn't run away from us, like it currently is in countries like the US? >
  
  If you remove choice of labor from people and make it into a single party central planning operation then the bureaucracy makes it more wasteful and fewer routes get explored >
  
  So, you're agreeing with my assertion, is that it? But you're saying that something that you can think of to "replace it", would be worse? Am I reading your right? >
  
  Are you asserting that in a hypothetical perfect world we could make significant efficiency gains? Sure I’d agree to that! Do I think that one’s freedom of choice in who they work for supersedes a hypothetical efficiency gain? Yes >
  
  This would be true if capitalism actually encouraged competition of the type you describe. But it doesn't. What happens in practice is that one of the two companies has some advantage: it has some increased market capitalization, better workers, patents, etc. For example, in your scenario, imagine that the distribution of workers is not exactly 50/50, but that one company has 60 and the other has 40. This lets the company with 60 workers bring products to market more quickly, allowing them to outcompete the company with 40 workers. Eventually, this allows the 60-worker company to hire away the workers of the 40-worker company. The resulting process tends towards a monopoly in which all capital resources are concentrated in a single entity: the one company that has all the workers. So efficiency problems from competition of the type you describe are only transitory: they go away when one company "wins" and manages to dominate the market. >
  
  
  This would be true if capitalism actually encouraged competition of the type you describe. But it doesn't. What happens in practice is that one of the two companies has some advantage: it has some increased market capitalization, better workers, patents, etc.
  
  Historically, that's not true.  In a capitalist society, without regulation, those two companies would team up to control the market, inflating profits so that each rakes in more money at a lower quality than if there were regulations in place.  We have seen this take place dozens of times over. >
  
  In your example there is no difference between one firm or two.  One firm = 2 outputs after N2 hrs.  Two firms = 2 outputs after N2 hrs.  The difference is that both firms are working to drive down N.  By competing, both are incentivized by the competition.  But this is just looking at the supply side.
  Without the competition you get monopoly pricing which pushes prices up and reduces demand.  So you have fewer people who are paying more for the same thing, so more people who would like the thing, but are priced out.  In my book, more people getting more stuff is more efficient. 
  Additionally, with two firms, there are two products.  These fir,s are going to try to make a better product to win customers.  The resulting innovation improves the product for everyone. >
  
  Your example assumes that the development of product N is an inevitable process that occurs directly in proportion to the number of people working on it. It also treats the development of N as an isolated process, ignoring the fact that reality is full of complex tradeoffs between priorities. 
  If only one company is developing N, what's the hurry? Its 100 workers can take their time. They might even decide that product M (the earlier version of N) is doing its job just fine as it is since no other business will offer an alternative. So, the world may never get N.
  With two companies, each has an incentive to invent new, better products. Each group of 50 workers knows that if they take too long, they've wasted their time. They work harder for longer to keep ahead of the other company. If both develop N, competition between the two encourages them to find new ways of producing N faster or cheaper to seize market share from the other, which benefits consumers of N.