Economics Questions

Re: How would you guys respond to this? What articles can help to answer this?

John James — Wed, 15 Aug 2012 20:24:28 GMT

Tom Woods did something similar with positive externalities/public goods when he was hosting the Peter Schiff Show one time. May favorite was his example of him wearing deoderant. Everyone benefits.

Re: How would you guys respond to this? What articles can help to answer this?

Kelvin Silva — Wed, 15 Aug 2012 20:02:25 GMT

What is a public good?

I guess the government should provide food to all. Eating is necessary to live, so therefore we have a right to food right?

Healthcare is needed to live, right to healthcare, government please drain my fellow citizen of his wealth and steal it to give me my healthcare.

Shoes are a public good. Everyone needs shoes to walk on the street, its a basic need! Shoes are a right!!!!

What about entertainment? Humans cant possibly live healthily and happily without entertainment. Govenrment, please make videogames and gaming a right for everyone!!! Think of all the fun we will all have if videogames were freeee!!!!!

Re: How would you guys respond to this? What articles can help to answer this?

Jon Irenicus — Wed, 15 Aug 2012 19:58:13 GMT

Believe it or not, these are easy questions. They just require thinking in terms of economic fundamentals.

Re: How would you guys respond to this? What articles can help to answer this?

dude6935 — Wed, 15 Aug 2012 19:55:41 GMT

There is no ideal (or even preferable) income distribution. So the state cannot aid in its achievement.

Re: How would you guys respond to this? What articles can help to answer this?

John James — Wed, 15 Aug 2012 19:38:38 GMT

Wheylous:
JJ, would you say public goods fall under externalities or externalities fall under public goods? Or neither?

I'm trying to come up with a way to organize the LibHQ lists, and I realized that "public goods" is related in some sense to externalities, but also to infrastructure (which has its own section at the moment). Should I categorize infrastructure under public goods and have externalities be a separate category?

Yeah it's kind of fuzzy. Generally people tend to clarify between "positive" and "negative" externalities, and postive externalities can and are typically be considered "public goods". Scientific research is a great example. So you might actually group it that way. Especially as you build the list, you might find that you'll have enough subjects to warrant a negative and positive section, and then a sub-section of "public goods" under the postive...all under an umbrella of "externalities."

But as you noticed, the guy quoted in the OP made them completely separate...which may end up being the best way to go just for simplicity's sake, and for the simply fact that that might be the easiest way for the average person to navigate.

Wheylous:
All at the touch of a button and completely free! Upgrade to premium now to have direct access to the brain of deceased Rothbard, Spencer, Spooner, and more! All for the low price of $199.99 paid in four easily installments of just $49.99 each! Other conditions may apply.

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Re: How would you guys respond to this? What articles can help to answer this?

Wheylous — Wed, 15 Aug 2012 13:07:09 GMT

JJ, would you say public goods fall under externalities or externalities fall under public goods? Or neither?

I'm trying to come up with a way to organize the LibHQ lists, and I realized that "public goods" is related in some sense to externalities, but also to infrastructure (which has its own section at the moment). Should I categorize infrastructure under public goods and have externalities be a separate category?

Re: How would you guys respond to this? What articles can help to answer this?

Wheylous — Wed, 15 Aug 2012 12:54:14 GMT

All at the touch of a button and completely free! Upgrade to premium now to have direct access to the brain of deceased Rothbard, Spencer, Spooner, and more! All for the low price of $199.99 paid in four easily installments of just $49.99 each! Other conditions may apply.

Re: How would you guys respond to this? What articles can help to answer this?

siope1kd — Wed, 15 Aug 2012 06:26:14 GMT

You guys are awesome. You've provided me with a wealth of information!

Re: How would you guys respond to this? What articles can help to answer this?

John James — Wed, 15 Aug 2012 05:46:39 GMT

In particular,

"Fallacies of the Public Goods Theory and the Production of Security" (PDF)

"A Theory of the Theory of Public Goods" (PDF)

"Of Private, Common, and Public Property and The Rationale for Total Privatization" (PDF)

more...

From The Ultimate Beginner meta-thread:

"Public Goods"

*Externalities threads* (including "global warming/climate change")

resources on Public Goods at Mises Wiki

Courts/Law, Security/Defense (Free Society reading list & threads)

Health care

Science, research, & technology development

But what about roads and schools?

Can the free market provide for the needs of the handicapped?

How To Rescue a Child (without the State)

Re: How would you guys respond to this? What articles can help to answer this?

ThatOldGuy — Wed, 15 Aug 2012 04:10:41 GMT

Public Goods- read chapter one.

Re: How would you guys respond to this? What articles can help to answer this?

siope1kd — Wed, 15 Aug 2012 04:07:44 GMT

,Wow, thank you! I look forward to reading you post soon!

Re: How would you guys respond to this? What articles can help to answer this?

siope1kd — Wed, 15 Aug 2012 04:07:08 GMT

Thanks, man!

Re: How would you guys respond to this? What articles can help to answer this?

Neodoxy — Wed, 15 Aug 2012 03:48:17 GMT

I'm working on a post that will hopefully provide a lot of insight into this very issue. At any rate,

1. This is by far the best and worst argument for the state, while its true that the market cannot solve this on its own in many situations, the fact is that the government itself falls victim to the phenomenon through voting. The difference is that the government has unlimited power, so it's the biggest public goods problem of all. Everyone has an incentive for everyone to vote intelligently, but no one person has a reason to vote intelligently because his vote counts for nothing in a society of hundreds of millions or even hundreds of thousands of voters. Even in a small modern society, you can't hope to wield more than 1,000th of the vote for anything significant. How much effort are you going to put in for that? How about 1,000,000th of the vote? When you get up to presidential races you hit lottery figures. So why would you let such an inherently dysfunctional organization solve this problem, or any problem?

2. Positive externalities are rarely important or significant, negative externalities always come down to private property problems, and this is something libertarians are dealing with more than anyone else. Once again, why would you want the government dealing with this? It's a stupid organization that has no incentive to actually fix any issue or at best has no reason to do so in an efficient manner.

The big exception to this is global warming, which is both the ultimate collective good and ultimate externality.

3. I assume that he's relying on arguments from imperfect information here, but then you have to argue that all markets suffer from large degrees of inefficiency, and indeed all markets do suffer from some amount of inefficiency, but if you're going to regulate it then you have a whole other matter on your hands. Anyway, we have to assume that a market in which there is a huge incentive for buyers and sellers to prove their worth, will do this more efficiently than an organization that has no incentive to see to this.

4. Who are you to say what someone should or should not earn? Insofar as the market is allowed to function properly incomes always gravitate to the best services at the lowest prices which could be provided to the consumer, and if it isn't then it's still voluntary. Why is it that those who have not produced, or even those who have produced, are entitled to any more or less than they recieved from voluntary contributions on the market?

Re: How would you guys respond to this? What articles can help to answer this?

Wheylous — Wed, 15 Aug 2012 03:36:40 GMT

I discuss some issues about inequality here:

http://candlemind.com/projects/progclub/file/michael/ineqdescr.php

I have not yet aggregated the links on externalities.

As to public goods, he probably needs to be more specific.

How would you guys respond to this? What articles can help to answer this?

siope1kd — Wed, 15 Aug 2012 03:26:45 GMT

I was reading a debate that a couple people were having and one of the rebbutles was this:

"Taxes can lead to a greater benefit for society because purely free markets are not always the right answer. Taxes can fix equity problems, problems in the economy, and provide goods and services that otherwise would lik

ely not be provided based on human behavior. Four points where the economy needs government interference in order to behave like a Pareto-efficient "free market" should:

1) Public Goods
2) Externalities
3) Insurance Markets
4) Equity concerns/Income Distribution issues

In a nutshell, there are plenty of well understood and agreed upon economic explanations for why there is a need for taxes to fund government service. People can say "It's not fair, I wanted that money myself!" but it isn't that simple or easy. Many times, taxes can provide more welfare for more people. They aren't perfect, but they work better than no government as far as I am concerned. I guess one could, if they were truly offended by taxes, work in the investment market (Like Romney) where there are plenty of legitimate tax breaks in order to incentivize economic growth. While it's not the best it could be, I personally am reasonably comfortable with the status quo for the time being. That's my big picture."

How would you guys respond to this? Can you direct me to any good articles talking about these things?

Thanks.

- Siope1kd