Re: Private urban green space
On 2004-08-03, Fred Foldvary uttered: >"Public goods" means collective goods, used simultaneously by some >group. This is a completely different meaning from "public" as in >public sector. Precisely what I meant. >"Solved publicly" is ambiguous because it can mean solved by a group or >solved by government officials. I should have been more explicit, but you evidently get the meaning. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Private urban green space
On 2004-08-01, Fred Foldvary uttered: >Economists are not "hostile" to public goods. Still, knowledge of economics tends to make you more receptive to the idea of the invisible hand and the possibilities of private economic organization. Hence, it makes you more libertarian. And libertarians are sure hostile to the public goods scene, because there the emphasis is on things that *need* to be solved publicly. >Public goods are facts to which economists apply theory like any >phenomenon. There is nothing inherently good or bad about public goods. I agree. Public goods are also highly interesting because they perfectly illustrate how hard econ can be. I mean, the simple rationality assumption we often apply to people clearly ceases to apply in case of public goods and all the various private ways people deal with their existence. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Private urban green space
On 2004-07-30, Jeffrey Rous uttered: >And, no I wouldn't expect a private firm to produce a non-excludable >park. I do think that a lot of times, economists are hostile the the >idea of a public good like a park if there is some way to make the good >excludable (fenced parks in London, country clubs, etc.). Hmm... If we think about purely private sprawl, this argument suggests that it might partly be about transportation costs. Essentially people don't want to live in walled communities, but they don't want people freeloading off their park, either. So, one way to give rise to exclusion without actual walls is to spread out into the far suburbs and lower the residential density, so that costs of freeloading from the adjacent community becomes costly. This would seem to imply a village model, where even sprawling areas have distinct centers with a denser population and larger estates at the sides (to provide a spatial buffer zone around central, public resources). Is this how privately built communities are? -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Private urban green space
On 2004-07-30, Fred Foldvary uttered: >No, the opposite is true. Zoning mandates urban sprawl, with density >ceilings, lot size requirements, etc. True, but I don't think Jeffrey was referring to urban sprawl as such. I think it was more about the polycentral, burbclave/walled community/owned living environment sort of model, where one can internalize the externality of having green space, security and the like around, but which is typically linked to isolation from the wider society, leftist propaganda on rising income differences and the like. That makes the model repulsive to a number of people, even as it solves a number of problems with small scale externalities. OTOH it leads to higher switching costs, the risk of monopoly pricing on the local public services, etc. >A neighborhood association has an incentive to build parks, since this >increases civic well being and therefore property values. Yes. This is what I refer to in talking about internalization of externalities. >Civic associations avoid the free rider problem because the residents >are members. This is a bit different. I'd connect this with the well-known fact (e.g. from Buchanan) that in small, tightly-knit communities externalities can be effectively controlled by social control and private pressure. In larger units the transaction costs become prohibitive. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Siberia and Canada
On 2004-04-08, [EMAIL PROTECTED] uttered: >Even if people's preferences were uniform with respect to climate >(which I doubt they are; I have a perverse friend who simply revels in >Chicago winter), they would not be uniform with respect to population >density. Well, you know, I'm one of the people who revel in the Finnish winter. I'm also hating the light right now. ;) My point is perhaps a bit more long term than Bryan's, but it relies on the same assumptions. I'm assuming that a warmer, more temperate environment is liked by the masses. I'm also assuming that if we aggregate such preferences, they will only change on an evolutionary time-scale, in average. Not everybody will have the same preferences, but in the average, over longer time-scales, we do. Now, even if you assume a mere 0.01 initial migration rate for one thousand kilometres south, per capita, per year, on the margin, and add in the typical near-exponential decay over time (and/or latitude), you'll still witness significant changes in mean population density over the next couple of centuries. That is, in the presence of lowered "transaction costs" -- the cost of moving has gone down considerably, hasn't it? Then factor in whatever follows from a lowered population density in an area left behind and you can see why I expect even stronger changes, in the absence of anti-migration policy. For instance, do you expect the highly illiquid spousal market to work even that much in an area from which people are moving out of? That ought to prove a positive feedback factor, given lowered fertility. So should diminishing scale benefits to a number of key industries. And so on. All this is part of the mechanism that drives urbanization, right now. I don't see any reason not the apply it to the present, global question -- surely if there is any migration gradient towards the equator, such factors will play a significant part. >I'm a Florida native, so I like warm weather as much as the next man; >but if you crowded six billion people into a narrow band around the >globe, then I (and like-minded others) would say "enough of this, I'm >going somewhere where there's enough space for me to own a house." Sure. Unless you had to import the construction workers, and the phone line, and the raw material, and the plans, from beyond a 500 kilometre radius... (Such concerns come rather naturally to me, given my location. I live in a relatively young and geographically extended country with brutal urbanisation rates -- the total populus is circa 5 million people, with over 10% of it already living within the capital area alone. As recently as 100 years ago Helsinki was rather insignificant as far as population went.) >In the world of uniform climate preferences and perfect mobility, I >suspect people would quickly distribute themselves across the globe >according to willingness to put up with population density. People would distribute themselves, but not uniformly. They would likely distribute themselves in a uniformly diminishing pattern outwards of desirable areas. In a perfect economy we'd probably witness a more-or-less Pareto income distribution, which would then determine who has enough money to live in the desirable areas, and who has to move elsewhere. Variance in individual preferences would also play a part, but it would likely be minor compared to the allure of major populated areas -- people do not move into cities for no reason. (Of course that is a prediction based on a statistical cross-section. In actuality there would be quite a lot of movement, even if the mean population density could be forecasted from the income distribution and the development of land price. Neither of which we can accurately predict.) >--Brian >Economics Undergraduate, University of Chicago --Sampo Economist wannabe, Helsinki University
Re: Siberia and Canada
On 2004-04-08, Christopher Auld uttered: >Well, for professionals under NAFTA there already is more or less free >migration. So do we have statistics on the migration characteristics of professionals? With pretty arrows, as in weather forecasts? That'd pretty much settle the question, especially across the English speaking Canadian states and the US. And in particular factoring in extra costs where there are lakes on the way -- they raise costs to incremental relocation, even in the presence of flight travel -- and the closeness of sea -- that significantly affects the climate. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Siberia and Canada
On 2004-04-08, Bryan Caplan uttered: >Question: If there were free migration between the U.S. and Canada, >would Canada lose a lot of population to California, Florida, and other >more desirable locations? In fact we might expand the rationale to something I once asked: in the event totally free economy ever came about, and transportation continued to get cheaper, would the total populus of the Earth eventually live in a narrow band centered on the equator? Alternatively, if the center of this band was too hot or the tilt of the Earth with respect to its orbit around the Sun required some correction, would we witness some other circular concentration of population, or perhaps two separate bands centered on a great (perhaps tilted) circle around the planet? -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Economics of Orgasm
On 2004-03-22, Robert A. Book uttered: >Some people have WAY too much time on their hands! ;-) Well... You know... Orgasms... Isn't that *just enough* time? -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: paying for blood donations
On 2004-02-23, Dan Lewis uttered: >While that may add a barrier to donating -- many people won't want to >do a good deed if it requires such an invasion of privacy -- why not >treat giving blood as any other donation, and make it a tax deduction >worth $X? Around these parts, blood donations are handled on a non-tax deductible basis. There's absolutely no pecuniary reward, either, and it's intentional. Why? Essentially the reasoning seems to revolve around the altruism/egoism divide. People who function egoistically are assumed to be more of a risk as a donor, because they might conceal infections and the like. Those who donate out of altruism are presumed altruistic in general, and so more likely to reveal crucial information and to take care of their health before donating. The funky thing is that this seems to work. The Finnish Red Cross, the monopoly provider of blood hereabouts, seems to have comparatively low infection rates. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: spamonomics
On 2004-01-20, Bryan Caplan uttered: >Why is such a high fraction of spam devoted to selling impotence >treatments? One possible explanation is that there aren't too many drugs which a broad segment of the population want, which they can't get because they'd need a prescription, which have semi-mythical (in this case aphrodisiac) properties, yet do not carry a harsh punishment for import, distribution or marketing. Potency drugs fit the description. >Are there really impotent guys who make an impulse purchase of v!agra >because they got some spam? Probably not. The spam is probably aimed at healthy males who think they can somehow benefit from a super-erection. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: How do I convince New Agers that not everybody should get the same wage?
On 2004-01-19, Kevin Carson uttered: >>By competition. And how does that arrive at this solution? Simply by >>depreciating below their labor value the commodities which are by reason >>of their quality or quantity useless or unnecessary, ...and in making >>the producers feel, ...that they have manufactured articles absolutely >>useless or unnecessary, or that they have manufactured a superfluity of >>otherwise useful articles. Yep. In fact seem to remember that Popper also takes note of this in Open Society, when he argues that Marx should have just forgotten about labour value and taken exchange value more seriously. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Too many choices
On 2004-01-06, Fred Foldvary uttered: >> He says that as the number of choices we have grows (for products) we >> become less happy, > >Is he just guessing, or is there evidence for this? I seem to have heard of some controlled experiments to this effect, in the psychological literature, so I think there might be a small grain of truth to the claim. (As usual, no cite. Take the grain of truth with a grain of salt.) But I also think the problem is elsewhere. Basically, lots of choices are only a problem when you habitually look back, mull over the opportunity cost, and start to hesitate with choice because costs are involved. That's a sure sign of a mindset where people refuse to understand that choices are by definition about not having it both ways. Some of the problem also comes from not acknowledging that sunk costs are indeed sunk, and that that's just fine. >From this perspective the idea that lots of choices are bad is simply a symptom of people's unwillingness to conceive of choice the way orthodox economics does. But what really makes me wonder is why these ideas are becoming so commonplace right now. Have people in fact been more economically savvy in the past, or what? And if they have, why the change? (It shouldn't come as a surprise that, as a libertarian, I'm prone to blaming creeping socialism for these sorts of things. ;) -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Why is a dollar today worth more than a dollar tomorrow?
On 2003-12-05, john hull uttered: >For some reason, I can't get it straight in my head why the risk-free >rate of interest would be higher than zero. The easiest example I know of is, would you be happy saving all of your income for the next year, without receiving a formidable compensation? That'd kill you, after all, because eating is consumption. This shows us that people have at least some urgent desires which aren't interchangeable with longer term ones. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Why is local currency good or bad or neither?
On 2003-10-31, Fred Foldvary uttered: >> In case of local currency, the tax authorities do not bother as easily >> because of the cost and the trouble with drawing the line between >> mutual help and legally taxable transactions. > >I don't see why this would be different between local currencies and >national currencies. As for the first point, it's different because the tax authority cannot easily uncover tax fraud if it's confined to a closed circuit of people who all forgo accounting, as it usually is with trading circuits. With normal cash people would have to ensure that the unaccounted cashflow is totally balanced within a certain group of people, so that its existence cannot be inferred from transactions with people who do account. This is significantly harder when we're dealing in federal paper dollars which, after all, everybody accept. As for the second, it's a cultural thing. It's easy to convince people that transactions conducted in cash or other sorts of generally accepted money are something that could be taxed. But as we already saw from the example with the DIY plumber, we can expect a rather negative gut reaction from the vast majority of people if the IRS touches self-help. The same goes for mutual help, provided money isn't used. Local currencies lie in-between as far as the psychology goes -- they're money, but people perceive them as a cooperative medium, not something having to do with the wider, taxable economy. Hence, trying to touch trade valued in them will provoke a reaction much like that of the DIY pluber, something quite possibly not worth the cost to the tax authority. >Markets for what? It is the market for credit that is rigid, as I said >earlier. Among others the market for credit, yes. But also the markets for labor, services and goods. When we're in a depression (which is usually what we have when we witness persistently high unemployment across multiple sectors of the economy), it is possible that any one (or all) of those markets are left uncleared. Local currencies can help sidestep all of the imbalances, simultaneously, without credit expansion. (Naturally both Keynesian and monetarist theory suggest that credit expansion helps in the short term if prices in these markets are downwardly rigid, so you're right to emphasize the role of credit market imbalances. Monetarism suggests that inflation will prove a problem of monetary expansion in the long term, but in the case of local currencies, there are extra-economic mechanisms which help control it -- credit creation is distributed, yes, but it's also controlled by social and moral ties. My point is that local markets can be in internal equilibrium *without* credit creation, even when the global economy is in disequilibrium and in need of a demand side stimulus.) >What is really being created is credit. X is a carpenter. Y wants to fix >a table. Y has no national cash Y creates local dollars and uses them to >pay the carpenter. Alternatively those local dollars have been created long ago, the currency has never been freely exchangeable against the national currency, and so the local labor market as valued in national currency can be in grave imbalance, leaving most local people without federal paper dollars, while at the same the market as valued in local currency is in equilibrium and provides people with both income and limited efficiency. This line of thought seems weird indeed if you're used to markets being in equilibrium. But if you go to endogenous money and permit arbitrage imbalance between separate commodity markets, you'll see that it all makes perfect sense -- in a depression federal paper dollars can become less liquid than local currencies, and so (locally) stop being the preferred medium of (indirect) exchange. In fact, the mechanism isn't too different from the one that causes prison inmates to switch from paper dollars to a commodity based currency in their internal dealings. >If Y had instead gone to banks to ask for a loan, they would declined. Indeed. If federal paper dollars were equivalent to the local currency, credit issued in one of them would be a perfect substitute for credit issued in the other. But it isn't, is it? Why? I'd say that's because the local and global cash economies can be decoupled, so that macroeconomic disequilibria need not significantly affect trade valued in a local currency. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Why is local currency good or bad or neither?
On 2003-10-31, [EMAIL PROTECTED] uttered: >People also often suffer from a confusion between income and money. >They tend to think of the two as synonymous, that anything not received >in money isn't income and therefore isn't taxable. Precisely. If we drop the distinction, we can for instance easily see that all sex is actually prostitution of one kind or another. Not that I'd easily argue that in public... ;) -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Why is local currency good or bad or neither?
On 2003-10-31, Fred Foldvary uttered: >> At least in some cases we can analyse local currencies as instances of >> tax evasion. > >So why not just use federal paper dollars for that? Because if you get caught, you'll pay for it. In case of local currency, the tax authorities do not bother as easily because of the cost and the trouble with drawing the line between mutual help and legally taxable transactions. (From the econ standpoint, there's no such line. If we were to be perfectly logical about it, tending to your children is a service to your spouse with a taxable value.) >> From this perspective local currencies can also be a means to >> circumvent labor market rigidities. > >Again, why not just use federal cash? Because it isn't always available if the relevant markets are rigid. Local cash on the other hand can be created on demand, and even neglecting that, is somewhat decoupled from the ordinary cash economy. >What is more neighbourly is the local organization and the relationships >it fosters. So why not just use federal paper dollars for that? -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: Why is local currency good or bad or neither?
On 2003-10-30, Fred Foldvary uttered: >So basically this is a response to credit constraints. Another reason people may be inclined to use local currencies is that the narrow circulation and informal accounting usually associated with them make it difficult to collect taxes on the associated transactions. At least in some cases we can analyse local currencies as instances of tax evasion. Another common reason why local currencies are used is unemployment. When people are unable to earn a living on the open market, they'll have to rely on friends and neighbours for help, which easily leads to reciprocal trade in services. That can easily spread and give rise to a new, local currency when bilateral trade no longer suffices. From this perspective local currencies can also be a means to circumvent labor market rigidities. I've heard of a couple of examples here in Finland where the system has basically started out as a mutual help collective, then undergone expansion and the usual problem with a commons, and finally adopted some unit of accounting. A list of currently operating LETS's (Local Community Exchange Group) in Finland lives at http://hammer.prohosting.com/~msurakka/suomi.htm . It seems that a dislike for hard currency is a big part of why they exist. What I can't fathom is why these people engage in indirect trade, use what is essentially money and even compete, but still think that it's somehow more "neighbourly" or "human" to do all this in an alternative currency. The funniest part is that in many cases local currencies are started by different kinds of socialist collectives who wish to fix the hourly wage or simply do not like hard currency. It's really quite funny to see a bunch of sworn communists denounce money, only to reinvent it in another form a couple of months later. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: [Fwd: Re: Popular views of the New Deal]
On 2003-10-23, Bryan Caplan uttered: >Check out almost any textbook: Thomas Bailey's is one obvious example. >Schlesinger *Age of Roosevelt* and Hofstader's *American Political >Tradition* are others. It's easy to agree that this is the prevailing view of things: spending cured the Depression. I wonder about explanatory power, though. Where's the work that follows a coherent economic theory and goes through all the relevant statistics, interpreting them according to the theory (whatever it might be; probably old-Keynesian, but whatever), so that the analysis arrives at purported causality instead of mere coincidence? I've seen more than one Keynesian treatment of the Great Depression, yet not one of them go as far as to actually test the hypotheses underlying the vulgar-Keynesian thesis. They do not ambush their own presuppositions with all the neo-classical, neo-Keynesian, supply-side, and even Austrian, challenges that are out there. That makes most of them pretty boring, really... -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
Re: The cconomics of heating
On 2003-08-26, Hentrich, Steffen uttered: >But he pointed out, that heating subsidies by landlords are not normal >practice. But how do we know they aren't, in average? A priori, I cannot see any way to determine that from rental costs alone. I mean, we do often witness premiums for large apartments, which have sizable exterior area. We think of them as constituting larger living spaces, but they might in part be about heat dissipation. (To test this hypothesis, we would do factor analysis on actual floor and wall area, plus a query on height+length preference by the tenants. Floor and wall area should account for heat dissipation potential in free space, while height and asymmetricity preferences ought to account for much of the rest.) The second answer is that controlling for temperature is too expensive as of now. In the future, it might be something landlords routinely do, but today, the technology, its installation costs and tenants' psychological response (most people dislike non-flat pricing schedules) might overrule the economic incentive towards heat economization. After all, heating is just a little part of what living in apartment is about. >In germany we have a regulation for heating costs in tenements, so there >is no freedom of contract. For commercial buildings I have no evidence. I know even less about what is going on here in Finland. I suspect we do not have explicit rules on how much heating (or water, or electricity; they all tend to be priced flat in housing blocks) is supposed to cost. The same goes for the commercial zone, so I don't think there's a huge difference there, either. -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
[OT] Re: Economics and E.T.s
On 2003-08-19, Tigger uttered: >Here's a cool idea I haven't heard anybody else articulate: computer >assisted telepathy. [...] I expect it in my lifetime. That seems more like a transhumanist idea than an armchair economist one. >In the future, "thought speakers" will be likely -- so your Google news >feed bypasses airwaves and goes from your computer, wirelessly, to your >ear amp and into your head. Actually I think "thought speakers" will be exceedingly unlikely. There is no reason to believe our thought processes would have been arranged in an order graspable by man. The basic physics might help us copy them, to achieve, say, immortality, but I think parsing what individual people think is a problem far more difficult. In addition, even reading off and passing over thoughts seems like intractable to me -- why on earth would someone suggest such a feat would be possible, given that we haven't the slighest clue as to how thoughts or self-awareness are encoded, in the brain? -- Sampo Syreeni, aka decoy - mailto:[EMAIL PROTECTED], tel:+358-50-5756111 student/math+cs/helsinki university, http://www.iki.fi/~decoy/front openpgp: 050985C2/025E D175 ABE5 027C 9494 EEB0 E090 8BA9 0509 85C2
