What If There Were No Prices? Railroad Thought Experiment
15 May 2016 Leave a comment
in applied price theory, applied welfare economics, Austrian economics, comparative institutional analysis, constitutional political economy, entrepreneurship Tags: market process
When two monkeys are unfairly rewarded for the same task.
12 May 2016 Leave a comment
in applied price theory Tags: monkeys
I hope no one in @OxfamGB’s #taxhaven clip were fresh from a #TPPANoWay march?
11 May 2016 Leave a comment
in applied price theory, development economics, economic history, growth disasters, growth miracles, income redistribution, international economic law, international economics, Public Choice, rentseeking Tags: antiforeign bias, Left-wing hypocrisy, neocolonialism, Oxfam, rational irrationality, reactionary left, tax havens, TPP
I hope none in this clip protesting against tax havens as short changing everybody else were fresh from protesting how international economic agreements such as the TPPA infringe on the sovereignty of countries.
If you standing up for national sovereignty that includes standing up for the right of other countries doing things that you do not like within their own country.
If countries have the right to set taxes and tariffs as high as they like, they have just the same right to set them as low as they like.
All that plucky rhetoric of TPPA no way and how international economic agreements violate the sovereignty of countries and developing countries in particular is forgotten in a flash by Oxfam.
Oxfam manages the blinding hypocrisy of opposing the Transpacific Partnership on national sovereignty grounds and at the same time call for international treaties to bully small countries about their tax policies, which overrides their economic sovereignty.
The sovereign rights of developing countries to find their own way does not extend to undermining the tax bases of the rich countries struggling to finance their welfare states.
The Pacific Islands, the once were heroes of the recent Paris climate talks, turn into pariahs once they start looking out for themselves and setting up offshore financial centres and tax havens.
Developing countries are free to impoverish themselves by embracing socialism, but if they decide to attract investment and jobs through low tax rates and offshore financial centres, a new form of colonialism is embraced by the reactionary left as embodied by Oxfam.
When my father was born, 7 in 10 people lived in absolute poverty.
Today, it's 1 in 10! https://t.co/1Caqku3AY1—
Tim Fernholz (@TimFernholz) October 21, 2015
Profits Are Progressive
10 May 2016 Leave a comment
in applied price theory, economics of media and culture, entrepreneurship, industrial organisation, survivor principle, theory of the firm Tags: anti-market bias, entrepreneurial alertness, profit and loss, rational irrationality, superstars
Bias and the BBC
10 May 2016 Leave a comment
in applied price theory, economics of media and culture Tags: BBC, media bias
Trekonomics: The Final Frontier (w/ Manu Saadia)
09 May 2016 Leave a comment
in applied price theory, applied welfare economics, Austrian economics, comparative institutional analysis, constitutional political economy, development economics, economics of regulation, environmental economics, history of economic thought, industrial organisation, international economics, law and economics, property rights Tags: star trek
With friends like these, the #UBI will not live to face its enemies @jordNZ
09 May 2016 Leave a comment
in applied price theory, applied welfare economics, politics - New Zealand, politics - USA, public economics, rentseeking Tags: universal basic income
Running around saying that Universal Basic Income will make work optional leaves open the question of who will be the suckers who actually do the work and pay enormous taxes to fund the idyllic lifestyle of the bohemian rest.
Source: What If Everybody Didn’t Have to Work to Get Paid? – The Atlantic.
@BernieSanders should be the @realdonaldtrump’s running mate
08 May 2016 Leave a comment
in applied price theory, applied welfare economics, international economics, politics - USA Tags: 2016 presidential election, comparative advantage, free trade, left-wing popularism, rational ignorance, rational rationality, right-wing popularism
The Coase Theorem
08 May 2016 Leave a comment
in applied price theory, applied welfare economics, Austrian economics, comparative institutional analysis, constitutional political economy, economics of regulation, environmental economics, history of economic thought, industrial organisation, law and economics, property rights, Ronald Coase Tags: Coase theorem
Pierre Desrochers explains why the ‘buy local’ food movement overstates environmental benefits
08 May 2016 Leave a comment
in applied price theory, applied welfare economics, development economics, economic history, economics of media and culture, environmental economics, growth disasters, growth miracles, health economics, industrial organisation, transport economics Tags: food miles
@AndrewLittleMP all but admits rents to go up after Healthy Homes Bill?
08 May 2016 Leave a comment
in applied price theory, applied welfare economics, economics of regulation, Public Choice, rentseeking Tags: economics of housing, economics of mandates, expressive voting, fatal conceit, rent controls, The pretense to knowledge
Opposition Leader Andrew Little accepts that mandating insulation and heat pumps into rental properties will increase their value. But he denies that this will affect rents!
Source: Healthy Homes Bill won’t up rents Little | Politics | Newshub.
An upgrade increases the value of a rental property if the improvements that increase its rental value. You cannot have the increase in the value of the asset without the increase in rent.
I will contract out the rest of my answer to David Friedman’s superb book Laws Order:
For an application of economics to a different part of the law, consider the nonwaivable warranty of habitability, a legal doctrine under which some courts hold that apartments must meet court-defined standards with regard to features such as heating, hot water, sometimes even air conditioning, whether or not such terms are provided in the lease—indeed, even if the lease specifically denies that it includes them.
The immediate effect is that certain tenants get services that their landlords might not otherwise have provided. Some landlords are worse off as a result; some tenants are better off. It seems as though supporting or opposing the rule should depend mainly on whose side you are on.
In the longer run, the effect is quite different. Every lease now automatically includes a quality guarantee. This makes rentals more attractive to tenants and more costly to landlords. The supply curve, the demand curve, and the price, the rent on an apartment, all shift up. The question, from the standpoint of a tenant, is not whether the features mandated by the court are worth anything but whether they are worth what they will cost.
The answer may well be no. If those features were worth more to the tenants than they cost landlords to provide, landlords should already be including them in their leases—and charging for them. If they cost the landlord more than they are worth to the tenant, then requiring them and letting rents adjust accordingly is likely to make both landlord and tenant worse off. It is particularly likely to make poorer tenants worse off, since they are the ones least likely to value the additional features at more than their cost.
A cynical observer might conclude that the real function of the doctrine is to squeeze poor people out of jurisdictions that adopt it by making it illegal, in those jurisdictions, to provide housing of the quality they can afford to rent.
If my analysis of the effect of this legal doctrine seems implausible, consider the analogous case of a law requiring that all cars be equipped with sunroofs and CD changers. Some customers—those who would have purchased those features anyway—are unaffected. Others find that they are getting features worth less to them than they cost and paying for them in the increased price of the car.
More police reduces crime
07 May 2016 Leave a comment
in applied price theory, economics of crime, labour economics, labour supply, law and economics, occupational choice Tags: crime and punishment, criminal deterrence, law and order, police
Be careful for what you wish for when using irrationality as a rationale for the scope of government
07 May 2016 Leave a comment
in applied price theory, comparative institutional analysis, constitutional political economy, economics of information, Public Choice Tags: behavioural public choice, growth of government, rational irrationality, size of government
Source: Gary Lucas and Slavisa Tasic‘s "Behavioral Public Choice and the Law" (West Virginia Law Review, 2015) via Bryan Caplan
Recent Comments