tag:blogger.com,1999:blog-19727420.post6893293020321729845..comments2024-03-23T12:05:13.464-07:00Comments on Ideas: Economics as a Unifier of Law: A True StoryDavid Friedmanhttp://www.blogger.com/profile/06543763515095867595noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-19727420.post-44996061529959283802012-11-24T14:31:48.374-08:002012-11-24T14:31:48.374-08:00hudebnik, if you use the term "freeloader&quo...hudebnik, if you use the term "freeloader" to refer to people who pay taxes...then what term would you use to refer to people who do not pay taxes? <br /><br />You're technically critiquing anarcho-capitalism...but what you're actually trying to critique is a taxpayer division of labor. But why would it be effective/efficient for every single taxpayer to evaluate every single possible solution to every single problem?<br /><br />Command economies (ie our public sector) fail because they fail to incorporate even the smallest fraction of the massive amount of information/values that are incorporated by market economies...<br /> <br />"It must be remembered, besides, that even if a government were superior in intelligence and knowledge to any single individual in the nation, it must be inferior to all the individuals of the nation taken together. It can neither possess in itself, nor enlist in its service, more than a portion of the acquirements and capacities which the country contains, applicable to any given purpose." - J.S. Mill<br /><br />Individual agency...what each and every one of us chooses to spend our own time/money on...incorporates the information/values that economies need in order for the output to actually be relevant. Individual valuation is the essential and accurate feedback mechanism. It is the fail safe device that prevents massive amounts of limited resources from being wasted on tilting at windmills. For example, I'd be willing to bet $900 that if I asked you to paypal me $1000 that your willingness to do so would depend on my explanation. <br /><br />If we create a market for public goods then taxpayers would have the freedom to shop for themselves in the public sector. Congress would still be there though...so nothing would stop you from giving all your taxes to personal shoppers. <br /><br />And if you didn't approve of how Jeff Bezos was spending his taxes...then <a href="http://en.wikipedia.org/wiki/Ethical_consumerism#Tax_choice" rel="nofollow">foregoing the convenience</a> of shopping on Amazon.com would certainly be an option for you and everybody else.Xerographicahttps://www.blogger.com/profile/14978832439622230018noreply@blogger.comtag:blogger.com,1999:blog-19727420.post-22326558119108034502012-11-24T13:04:21.080-08:002012-11-24T13:04:21.080-08:00David Friedman, it's a problem, a significant ...David Friedman, it's a problem, a significant problem, to consider "engineering" solutions out of context. Sure...there was an engineering solution to building the pyramids...but what about <a href="http://pragmatarianism.blogspot.com/2012/11/were-pyramids-smart-investment.html" rel="nofollow">the opportunity cost</a>? Same thing with the extermination of Jews during WWII and the war on terror. <br /><br />Whether the solutions to "problems" are efficient or not has absolutely no real value or meaning out of context. <br /><br />When we put criminal behavior in context then it's not just a simple matter of deterring crime...it becomes a complex issue of a stitch in time saving nine. <br /><br />Your solution is a good deal more radical than mine...this is true. Unfortunately, its efficacy is limited by how radical it is. Plus...if your solution truly maximizes the size of the pie...then why wouldn't my solution put us on the path to your solution?<br /><br />"It is, of course, not desirable that anything should be done by funds derived from compulsory taxation, which is already sufficiently well done by individual liberality." - J.S. Mill<br /><br />Why would taxpayers pay public organizations to do anything that is already sufficiently well done by private organizations?Xerographicahttps://www.blogger.com/profile/14978832439622230018noreply@blogger.comtag:blogger.com,1999:blog-19727420.post-74944627136879318902012-11-24T06:30:50.214-08:002012-11-24T06:30:50.214-08:00Xerographica: your proposal has a problem well-kno...Xerographica: your proposal has a problem well-known to economists.<br /><br />The amount of enforcement of a given law is unlikely to be a simple linear function of the available funding; more likely, up to a certain point it won't be enforced at all. Which leads to a "freeloader's paradox".<br /><br />If the law is not currently enforced due to insufficient funds, the amount I can afford to chip in to enforce it is unlikely to push it over the threshold, so I'm unlikely to get any benefit at all for my payment, so I'm unlikely to donate. OTOH, if it <i>is</i> being enforced, then my payment won't make it any <i>more</i> enforced, so again I'm unlikely to donate.<br /><br />The only kind of person likely to donate for enforcement of a particular law is somebody wealthy enough to afford the full cost of that enforcement. As a result, laws of interest to rich people (say, theft) would be enforced disproportionately relative to laws of interest to <i>all</i> people (say, murder) or laws of interest to poor people (say, worker safety). And if I can afford to enforce the law myself, I might skip the government entirely and just hire my own enforcers. Which may be the sort of world some would prefer to live in, but consider carefully before going that direction.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19727420.post-68589869258910654852012-11-24T06:16:09.931-08:002012-11-24T06:16:09.931-08:00I've occasionally gotten bills in the mail for...I've occasionally gotten bills in the mail for extremely small amounts (less than a dollar) and wondered whether it was costing the company more money to print and mail the bill, cash my check, and (with small probability) chase me down for failure to pay, than the amount I was supposed to pay them.<br /><br />Would there be negative consequences, perhaps involving customer expectations, to a company that routinely didn't bill for amounts less than a dollar?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19727420.post-40477642602991269162012-11-23T15:43:10.370-08:002012-11-23T15:43:10.370-08:00"Am I missing something?"
Yes. You are ..."Am I missing something?"<br /><br />Yes. You are confusing two quite different questions:<br /><br />1. What institutions are most likely to produce the right answer to a legal question<br /><br />and<br /><br />2. What is the right answer to that legal question?<br /><br />For an analogy ... . Suppose we were discussing how to best increase the fuel efficiency of an automobile. It might be true that we will get the best automobiles if they are produced on the free market. But that fact doesn't tell us what they will, or should, be like--that's an engineering question.<br /><br />Similarly here. The question I was asking in my article was how you would in principle calculate the punishment for any offense, if your objective was what economists call economic efficiency—loosely speaking, maximizing the size of the pie, the net benefit to all affected. I have written elsewhere about what institutions would tend to generate efficient law—my solution is a good deal more radical than yours—but that wasn't the topic of the paper of mine I described in the post.David Friedmanhttps://www.blogger.com/profile/06543763515095867595noreply@blogger.comtag:blogger.com,1999:blog-19727420.post-29711451792731871182012-11-22T22:45:49.506-08:002012-11-22T22:45:49.506-08:00The law enforcement part sounds so complicated. T...The law enforcement part sounds so complicated. Taxpayers should just pay to enforce the laws that they want enforced. If I want drugs to be illegal...then I'd go to the DEA website and submit a tax payment. <br /><br />How much revenue would the DEA receive? If drugs are illegal, but nobody is willing to pay to enforce the law, then does the law matter?<br /><br />Am I missing something? Is there a situation when people shouldn't have to <a href="http://en.wikipedia.org/wiki/Put_your_money_where_your_mouth_is" rel="nofollow">put their money where their mouths are</a>?Xerographicahttps://www.blogger.com/profile/14978832439622230018noreply@blogger.com