In this article, Robert Murphy says that "Most economists favor free trade because (at least under classical assumptions) when the government imposes a tariff, the monetary gains to the winners are outweighed by the monetary losses to the losers." Again: "And as we've seen, the general rule is that a tariff hurts consumers more than it helps producers."
What is the reasoning behind this?
AnalyticalAnarchism.net - The Positive Political Economy of Anarchism
eliotn:Monopolies/quasi-monopolies are good for the monopolistic company and the government but bad for everyone else. And it also makes the industry worse, if you are curious.
It doesn't make the industry worse off. Harley Davidson learned a lot of useful techniques from the Japanese that turned their outlook around. If it wasn't for the tariff, they would have gone out of business.
Danja:Voluntary consent fails miserably when it comes to correcting externalities.
No it doesn't.
Danja:Theft is "good" when it promotes the social welfare.
Ok, now you're just trolling. Stop. This is a warning.
What is the social welfare? If giving to the poor promotes it, I could steal from the rich and the middle class as long as I gave to the poor. Heck, I should just steal from anyone who has more than they need, just to help the poor. I need to become a theif. LONG LIVE THE POOR.
Danja: Voluntary consent fails miserably when it comes to correcting externalities.
Voluntary consent fails miserably when it comes to correcting externalities.
Alright, for positive externalites, what is the problem? Since both people benefit from something, it is helpful. This is good, why does a zero-sum game further make this better. Certainly, someone is going to loose.
For negetive externalities, often times, these involve a violation of properity rights, which can be solved by negotiation or PDAs. What are ones that don't involve property rights that are still significant?
Danja: eliotn:Wait, didn't Rothbard prove that this was false? How about Mises? I read Human Action and MES back to back years ago, and nowhere did they prove externalities don't exist
eliotn:Wait, didn't Rothbard prove that this was false? How about Mises?
I read Human Action and MES back to back years ago, and nowhere did they prove externalities don't exist
They proved that nothing should be done coercively in the case of positive externalities, and that properity rights solve negetive externalities.
Oh, and one more thing, public schools are a negetive externality (I sent in a paper to my econ teacher). So are public roads, police, fire protection, and other social services. So are involuntary laws, which benefit some at the expense of others.
Schools are labour camps.
Knight_of_BAAWA:No it doesn't.
Is voluntary consent going to stop global warming?
Knight_of_BAAWA:Ok, now you're just trolling. Stop. This is a warning.
The example is the one I just gave about Harley Davidson. Obviously, libertarians consider tariffs to be theft. But Harley Davidson is a clear case where protection promoted the social welfare.
It only sounds like I'm trolling because I'm using your language. I certainly don't consider taxation to be theft.
Knight_of_BAAWA: Ok, now you're just trolling. Stop. This is a warning.
I spotted this over an hour ago. lol
eliotn:What is the social welfare? If giving to the poor promotes it, I could steal from the rich and the middle class as long as I gave to the poor. Heck, I should just steal from anyone who has more than they need, just to help the poor. I need to become a theif. LONG LIVE THE POOR.
That sort of theft would induce dynamic consequences that would not help the social welfare. Now you're just being facetious.
eliotn:Alright, for positive externalites, what is the problem? Since both people benefit from something, it is helpful. This is good, why does a zero-sum game further make this better. Certainly, someone is going to loose.
They won't benefit if the activity is never undertaken because the externalities aren't taken into account
eliotn:For negetive externalities, often times, these involve a violation of properity rights, which can be solved by negotiation or PDAs. What are ones that don't involve property rights that are still significant?
Global warming? Property rights don't solve everything. Not all externalities can be easily delineated.
eliotn:They proved that nothing should be done coercively in the case of positive externalities, and that properity rights solve negetive externalities.
Refresh my memory. What would their argument be in the case of tariffs to protect young industries?
Danja:It doesn't make the industry worse off. Harley Davidson learned a lot of useful techniques from the Japanese that turned their outlook around. If it wasn't for the tariff, they would have gone out of business.
Ok, Harley Davidson goes out of business due to inefficiency, and more efficient businesses cater to what the consumers want. That makes the industry better in my book, since the rest of the companies cater to the buyer much better. On the other hand, it is worse if Harley Davidson is inefficient but sustained by a tariff. The tariff also involves *GASP* coercion.
Danja:The example is the one I just gave about Harley Davidson. Obviously, libertarians consider tariffs to be theft. But Harley Davidson is a clear case where protection promoted the social welfare.
You're being dishonest with this statement, because you have no mechanism to measure the cost.]
Danja:It only sounds like I'm trolling because I'm using your language.
No, you're trolling because it is becoming apparent you are being intentionally dishonest. With us and yourself.
Danja:I certainly don't consider taxation to be theft.
If someone demands your property under threat of violence, is that not the definition of theft?
Danja:Is voluntary consent going to stop global warming?
Manbearpig is real, donchaknow.
Danja:The example is the one I just gave about Harley Davidson.
And that hurt consumers. There is no such thing as social welfare.
And it sounds like trolling because you are trolling. Please stop.
eliotn:Ok, Harley Davidson goes out of business due to inefficiency, and more efficient businesses cater to what the consumers want. That makes the industry better in my book, since the rest of the companies cater to the buyer much better. On the other hand, it is worse if Harley Davidson is inefficient but sustained by a tariff. The tariff also involves *GASP* coercion.
You're missing the point. It's not efficient. The externalities make it inefficient for Harley Davidson to go out of business. When private returns aren't the same as social returns, that's inefficiency.
Danja:That sort of theft would induce dynamic consequences that would not help the social welfare. Now you're just being facetious.
OK, so we established that I cannot define it. What is your definition of this? Is that everyone's definition? If not, why should some people be allowed to say what is theft and what is not, while the opinions of others are not considered?
Danja: They won't benefit if the activity is never undertaken because the externalities aren't taken into account
And why isn't the activity undertaken? Because the person preforming the action does not benefit ex ante.
Danja:Global warming? Property rights don't solve everything. Not all externalities can be easily delineated.
1. Prove global warming.
2. If global warming has harmful effects to a person's properity, wouldn't that person strive to stop it?
Danja:Refresh my memory. What would their argument be in the case of tariffs to protect young industries?
One sec. I will get their argument later.
liberty student:You're being dishonest with this statement, because you have no mechanism to measure the cost.
Nothing's ever perfect in economics, but we can measure the imports lost from the tariff. That's the loss in consumer welfare due to less output and higher prices. And you can get those numbers from the ITC.
By the way, I'm not saying tariffs are always a good idea. In fact, more often than not they aren't. There are usually better ways for the government to correct market distortions. And there are many cases where tariffs haven't worked at increasing efficiency. Computers in Brazil is a good example.
liberty student:If someone demands your property under threat of violence, is that not the definition of theft?
I don't think the word theft properly describes taxation. It requires looking at the context under which taxation takes place.
Danja:You're missing the point. It's not efficient. The externalities make it inefficient for Harley Davidson to go out of business. When private returns aren't the same as social returns, that's inefficiency.
What externalities? If Harley Davidson can't compete, then it is the source of misallocated labour and capital. That is the inefficiency.
You presume that without Harley Davidson, people will not be able to find profitable employment, or that Harley-Davidson is more important to the market, than consumers are willing to indicate with their purchasing power, and more profitable than capitalists are willing to invest.
In both cases, you are ignoring the clear signals the market is sending, and choosing to intervene, which upsets the free market, and causes inefficiency and waste, thus hurting your precious public good, and undermining prosperity for rich and poor, but more for poor, because you are taxing cheaper goods in the marketplace.
Very little of what you have posted today is rational or consistent. Someone who cares about the poor, does not prop up inefficient business, by taxing low cost goods necessary for the prosperity of the lower class.
eliotn:OK, so we established that I cannot define it. What is your definition of this? Is that everyone's definition? If not, why should some people be allowed to say what is theft and what is not, while the opinions of others are not considered?
I don't think it really matters. This is an economics discussion.
eliotn:And why isn't the activity undertaken? Because the person preforming the action does not benefit ex ante.
Exactly. That's the nature of the private return being too low.
eliotn: 1. Prove global warming. 2. If global warming has harmful effects to a person's properity, wouldn't that person strive to stop it?
1. I'm not a scientist and neither are you, so it's not my place nor yours to prove or disprove global warming. From an economics perspective the relevant question is, if global warming is real what needs to be done about it?
2. How can one person stop global warming?
liberty student:What externalities? If Harley Davidson can't compete, then it is the source of misallocated labour and capital. That is the inefficiency.
That's not true if there are market distortions. Again, if there are learning externalities that aren't taken into the account of profit-loss calculations, that's inefficiency.
If:
Future profits - loss in consumer surplus = a positive amount, then the failure of Harley Davidson is inefficient. Allowing Harley Davidson to survive and copy Japanese production techniques, is the efficient solution
liberty student: In both cases, you are ignoring the clear signals the market is sending, and choosing to intervene, which upsets the free market, and causes inefficiency and waste, thus hurting your precious public good, and undermining prosperity for rich and poor, but more for poor, because you are taxing cheaper goods in the marketplace. Very little of what you have posted today is rational or consistent. Someone who cares about the poor, does not prop up inefficient business, by taxing low cost goods necessary for the prosperity of the lower class.
This particular discussion actually has nothing to do with the poor. Hypothetically, Harley Davidson could be owned by middle-class shareholders, and its consumer base could consist of wealthy collectors. I'm not familiar with motorcycles outside of the trade aspect, so this could be true or it might not be. If it's not true and it's the other way around, then it is a question of whether we should be hurting poor consumers to benefit rich producers. There are always lots of issues involved.