I came across this a lot in Asheville, North Carolina.
Signs everywhere that encourage people to buy from local Ma' and Pa' shops and eat at family owned restaurants. I guess it implicitly says to reject big chain stores like Wal-Mart and the ilk. Not necessarily because these places offer lower prices mind you, it's more of a serve the community type of mindset. Are there any economic advantages and disadvantages to this?
They're acting in their own rational self-interest. They want people to purchase from their stores. They will create a product through marketing in order to do so.
TheFinest:Are there any economic advantages and disadvantages to this?
For the community living in that geographic region.
decided to google and this is what I came up with
The "Buy-Local" Canard
Buy Local, Save Your Government!
Should We Buy Only Locally Grown Produce?
(fyi, there's almost always a Mises Daily on any economic topic you might ever end up having a question about. Gotta love it)
Dang, excellent (and quick) work JJ. Will read them ASAP!
Yeah, the link you found is typical nonsense/propaganda (but I don't doubt the people putting it out there actually believe it.)
1. Significantly More Money Re-circulates In Greater Grand Rapids.
Essentially nonsense, as the link above illustrates:
Buy-local advocates cite studies showing that 68 percent of the money spent at local businesses stays in the "local economy." So I spend $100 at a locally owned store. What happens to the $68 of the original $100 that is then recirculated locally? Well, only 68 percent of it, or $46, stays local. And that $46 becomes $31, then $21, then $14, $10, $6.80, $4.57, $3.10, and so on. It won't be long before there's no money left in this town!
2. [Local] Non Profits Receive Greater Support.
(a) what exactly constitutes a "local" charity?
(b) who says these "local" charities (whatever they are) are doing more good than other charities?
(c) what is the difference between paying $10 for a local product, and having 10% go to a local charity, versus paying $4 for a "non-local" version of the same product and donating the savings you earned to a local charity? Oh that's right. "Local non-profits would receive greater support"...if you refused to buy local.
3. Unique Businesses Create Character & Prosperity
Fair enough. If that's what you're willing to pay for, fine. But that's not an economic case. That's a "I'm willing to pay more for something because I like the feeling it gives me" case. But don't try to tell me it "helps the economy".
4. Environmental Impact Is Reduced.
Not necessarily. I can't find the source at the moment, but I remember hearing a breakdown of the total carbon footprint of managing larger farms, and transporting goods versus incredibly small local farms delivering locally, and the ironic truth was, it was actually better for the environment in some cases to have goods imported from other areas.
And here's a very simple, plausible, obvious example of how buying “local” produce can have a very high carbon footprint….
5. Most New Jobs Are Provided By Local Businesses.
What does that even mean? Who provides the rest of the jobs? "Foreign businesses"?
(a) I have no idea what those terms are supposed to mean.
(b) What difference does it make? The people are employed.
The detail statement underneath this one is just simply "Small local businesses are the largest employers nationally." Um. Okay. And? I thought you were supposed to be giving me reasons to "buy local". You're saying one of those reasons is because "local businesses" employ more people than "non-local businesses"? Again, I still don't even know what that means, but what's more, so what? I would imagine the reasoning is "well if you don't buy from a local business, those people will lose their jobs." Oh? But wouldn't that mean the business that I do buy from would need to hire them to absorb all the new customers? So Joe isn't going to be out of a job. So what was the reason I have to buy "local" again?
6. Customer Service Is Better.
If that's true, why do I need you to tell me? Why do you need to "sell me" on buying local? If the service actually is better, and that's what I want, wouldn't I buy it anyway?
And since when can you guarantee that service is always going to be better anywhere? What if it's not? If service was so bad at a "non-local business" (which I still feel like an idiot saying, because I still have no idea what that is supposed to mean...unless I'm ordering things and having them delivered to me by mail, am I not "buying local"?)...but if service was so bad at these "other" places, wouldn't people stop going there anyway? And if they don't stop going, aren't they demonstrating their preference? Oh wait, that's right. You know what's best for everyone else.
The tag line in this one was equally hilarious: "Local businesses often hire people with more specific product expertise for better customer service."
What a goddamn joke.
7. Local Business Owners Invest In Community.
Again, unless I'm ordering by mail, am I not buying local? I still don't get it. I mean, are they saying a "local business" is one where the owners live in the town where the business is? So a Wendy's franchise...is that a local business?
8. Public Benefits Far Outweigh Public Costs.
"Local businesses require comparatively little infrastructure and more efficiently utilize public services relative to chain stores."
Wha? How do you figure? What evidence do you have for this? (My guess is absolutely nothing other than your ridiculous worldview.)
9. Competition And Diversity Leads To More Consumer Choices.
Hey great point! I think I'm going to buy from that "non-local business" that is competing with the local business. It's diversity is appealing and I like having choices.
10. Investment In Greater Grand Rapids Is Encouraged.
"A growing body of economic research shows that in an increasingly homogenized world, entrepreneurs and skilled workers are more likely to invest and settle in communities that preserve their one-of-a-kind businesses and distinctive character."
Could you provide me with some of this "growing body of economic research", because I have no idea what that means and perhaps this research would enlighten me.
There was also this visual I found on my google search but at this point I'm not too convinced on this whole thing to see much in it.
This kind of gets into the impossibility of producing anything efficiently without large scale specialization. I'm also reminded of the experiment to make a suit out of only local materials, the result was that the cost went up 100-fold. And that's the fact of the matter; local production is horrifically inefficient, and therefore bad for the environment, because it is non-specialized self-sufficiency.