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> "I think any positions taken on this subject that don't discuss it as a question of where to place this multiplier are disingenuous nonsense" Personally, I t

> "I think any positions taken on this subject that don't discuss it as a question of where to place this multiplier are disingenuous nonsense" Personally, I think "where to place this multiplier" is not anywhere close to the most relevant question. What matters isn't how big the multiplier is. What matters is what's causing it, and what problems it causes. If a big multiplier is caused by an atmosphere that promotes innovation, that's better than a small multiplier caused by a stagnant environment, which is better than a big multiplier caused by massive corruption and oppression. Norway, Sweden, and Finland have some of the lowest Gini coefficients in the world, way "better" than the US or the UK -- but so do Pakistan and Afghanistan. "Where to put the multiplier" is, at best, a secondary question after fixing all of the primary problems, and possibly a completely irrelevant question.

darawk 11y ago
Where to place the multiplier only becomes irrelevant when the bottom is acceptably high. If you think that the bottom is acceptably high, then you may accept an unlimited multiplier. I agree with you that a big multiplier caused by innovation is better than one caused by stagnation and rent seeking, but I don't think that we would be willing to accept any multiplier just because it promoted innovation. So the question remains: how much inequality is worth how much innovation? Assuming you accept PG's premise that more inequality equals more innovation
- lotharbot 11y ago
  > "only becomes irrelevant when the bottom is acceptably high" or, put another way, only becomes relevant when the bottom is unacceptably low. I'm much more interested in worrying about where the bottom is than worrying about the multiplier. It's a proxy measure -- perhaps a good proxy measure, but still a proxy measure. Instead of focusing efforts on the proxy measure as a whole, focus on specific issues that matter at the low end. If it happens that some specific issue is best resolved by closing tax loopholes or steepening the tax progression curve, OK -- but don't do it just to "lower inequality", do it to solve a specific problem.
  - darawk 11y ago
    I mostly agree. However, I think it's a little more than a proxy measure. I think people often conflate the notion of capitalism the resource allocation algorithm with capitalism the moral philosophy. The former says that assigning people directly the fruits of their labors leads to an efficient marketplace and ultimately greater welfare for all. The latter says that the efficacy of the former grants those people a moral right to those fruits. The former is almost certainly true - capitalism is much more effective at accelerating efficiency and innovation than anything else we've tried. But the moral corollary doesn't necessarily follow. And if you accept the former but deny the latter, you're faced with a question: Do we really need extreme outliers of wealth in order to achieve the benefits of capitalism? And if the answer is no, then does it really make sense to let those outliers keep all those resources?

darawk 11y ago

Where to place the multiplier only becomes irrelevant when the bottom is acceptably high. If you think that the bottom is acceptably high, then you may accept an unlimited multiplier. I agree with you that a big multiplier caused by innovation is better than one caused by stagnation and rent seeking, but I don't think that we would be willing to accept any multiplier just because it promoted innovation. So the question remains: how much inequality is worth how much innovation? Assuming you accept PG's premise that more inequality equals more innovation

lotharbot 11y ago
> "only becomes irrelevant when the bottom is acceptably high" or, put another way, only becomes relevant when the bottom is unacceptably low. I'm much more interested in worrying about where the bottom is than worrying about the multiplier. It's a proxy measure -- perhaps a good proxy measure, but still a proxy measure. Instead of focusing efforts on the proxy measure as a whole, focus on specific issues that matter at the low end. If it happens that some specific issue is best resolved by closing tax loopholes or steepening the tax progression curve, OK -- but don't do it just to "lower inequality", do it to solve a specific problem.
- darawk 11y ago
  I mostly agree. However, I think it's a little more than a proxy measure. I think people often conflate the notion of capitalism the resource allocation algorithm with capitalism the moral philosophy. The former says that assigning people directly the fruits of their labors leads to an efficient marketplace and ultimately greater welfare for all. The latter says that the efficacy of the former grants those people a moral right to those fruits. The former is almost certainly true - capitalism is much more effective at accelerating efficiency and innovation than anything else we've tried. But the moral corollary doesn't necessarily follow. And if you accept the former but deny the latter, you're faced with a question: Do we really need extreme outliers of wealth in order to achieve the benefits of capitalism? And if the answer is no, then does it really make sense to let those outliers keep all those resources?