4 ms·

The Science of Libertarian Morality

8 points by cubix 16y ago

tomjen3 16y ago
Okay I hate to do this, but we have had too many political pieces, so I have to flag it.
zdw 16y ago
Ever notice how nearly all articles about economic theory immediately gather the "ivory tower intellectual who has no concept of the real world - everything they study is in their own thought bubble" criticism? That same criticism applies to libertarianism - they're interesting ideas, but not implementable as stated. The number of countries that have implemented even half of what they propose is a null set. Not to say it wouldn't work, but you'd think at least someone would try it out somewhere and we'd have one datapoint...
- RyanMcGreal 16y ago
  Most economic regulations we have today exist because a government was trying to patch over a market failure. The US has Medicare, for example, because Americans were appalled that senior citizens were dying because they couldn't afford health care. Similarly, workplace safety regulations exist because Americans were appalled that employees were getting mangled and killed by the thousands in dangerous work environments; and so on. We can argue over whether a particular regulation was the best approach (maybe a smart incentives-based approach would work better than a prohibition, for example); and we can argue over whether a given regulation still makes sense in changing economic circumstances. However, it requires a special kind of dogmatic myopia to insist against all evidence to the contrary that markets are self-correcting, that positive and negative externalities either don't exist or don't matter, and that the best way to deal with disasters (like a restaurant poisoning thousands of customers with e. coli infection due to unsanitary food handling) is to let the market sort it out.
  - yummyfajitas 16y ago
    How is allocating limited healthcare resources to the young rather than the old a market failure? Did supply not meet demand? There are real examples of market failure, e.g. the current failure of housing markets to clear (I.e. prices not reachingg equilibrium). Could you explain how your examples are market failure?
- joshrule 16y ago
  Free enterprise is a clever system, because it reduces all the value that goes into a product or service to one figure, cost. Instead of understanding a business's environmental policy, its supply chain, its manufacturing technology, and so on, I just have to look at the price. It's an ingenious system which saves me a lot of time. But, one major barrier holding back a more successful libertarian experiment is the poor definition of profit that we currently use. We don't capture environmental or social costs very well at all, among others. There is a way to do so (after all, we all value potato chips and college educations differently, but we were able to put a price on those), but I haven't spent enough time looking for other attempts to solve the problem or working on my own to know exactly what it is. We just haven't pushed hard enough to find a better way, yet. It makes sense, given that many libertarian ideas are only a couple hundred years old.
  - RyanMcGreal 16y ago
    People tend to over-invest in negative externalities (because someone else pays part of the cost) and under-invest in positive externalities (because someone else enjoys part of the benefit). Pollution and climate change are two stark examples of the former. Because I don't have to pay my share of health care and infrastructure costs for the exhaust coming out of my car, I will tend to buy a bigger car than I would if the cost of that car included those externalized costs. Gas and carbon taxes are mechanisms to internalize those negative externalities. They create an incentive for drivers to buy more fuel-efficient vehicles, which creates an incentive for automakers to manufacture more fuel-efficient vehicles. This is why European cars are on average much smaller and more fuel efficient than American cars, despite the fact that Europeans and North Americans drive roughly the same annual distance (17,000 miles and 18,000 miles, respectively.) Another mechanism is the American CAFE system, which arguably does a worse job because it gives automakers an incentive to find loopholes in vehicle designations. We can thank CAFE for the preponderance of SUVs on the market. On the other side of the coin, education has a positive externality because some of the benefits of an individual's education accue to society as a whole. Given straight market forces, individuals will on aggregate under-invest in their own education, and the economy as a whole will suffer from a lower mean worker productivity. Every industrialized country quickly landed on universal public education because the aggregate benefits to productivity that come from a universally educated populate more than offset the higher cost to educate everyone. That is, even though average taxes are higher to help pay for education, average incomes are higher still.
RyanMcGreal 16y ago
Also of interest is Jonathan Haidt's TED Talk on the different moral foundations of liberals and conservatives: http://www.ted.com/talks/jonathan_haidt_on_the_moral_mind.html http://www.ted.com/talks/jonathan_haidt_on_the_moral_mind.ht...

8 points by cubix 16y ago

Okay I hate to do this, but we have had too many political pieces, so I have to flag it.

zdw 16y ago

Ever notice how nearly all articles about economic theory immediately gather the "ivory tower intellectual who has no concept of the real world - everything they study is in their own thought bubble" criticism? That same criticism applies to libertarianism - they're interesting ideas, but not implementable as stated. The number of countries that have implemented even half of what they propose is a null set. Not to say it wouldn't work, but you'd think at least someone would try it out somewhere and we'd have one datapoint...

RyanMcGreal 16y ago
Most economic regulations we have today exist because a government was trying to patch over a market failure. The US has Medicare, for example, because Americans were appalled that senior citizens were dying because they couldn't afford health care. Similarly, workplace safety regulations exist because Americans were appalled that employees were getting mangled and killed by the thousands in dangerous work environments; and so on. We can argue over whether a particular regulation was the best approach (maybe a smart incentives-based approach would work better than a prohibition, for example); and we can argue over whether a given regulation still makes sense in changing economic circumstances. However, it requires a special kind of dogmatic myopia to insist against all evidence to the contrary that markets are self-correcting, that positive and negative externalities either don't exist or don't matter, and that the best way to deal with disasters (like a restaurant poisoning thousands of customers with e. coli infection due to unsanitary food handling) is to let the market sort it out.
- yummyfajitas 16y ago
  How is allocating limited healthcare resources to the young rather than the old a market failure? Did supply not meet demand? There are real examples of market failure, e.g. the current failure of housing markets to clear (I.e. prices not reachingg equilibrium). Could you explain how your examples are market failure?
joshrule 16y ago
Free enterprise is a clever system, because it reduces all the value that goes into a product or service to one figure, cost. Instead of understanding a business's environmental policy, its supply chain, its manufacturing technology, and so on, I just have to look at the price. It's an ingenious system which saves me a lot of time. But, one major barrier holding back a more successful libertarian experiment is the poor definition of profit that we currently use. We don't capture environmental or social costs very well at all, among others. There is a way to do so (after all, we all value potato chips and college educations differently, but we were able to put a price on those), but I haven't spent enough time looking for other attempts to solve the problem or working on my own to know exactly what it is. We just haven't pushed hard enough to find a better way, yet. It makes sense, given that many libertarian ideas are only a couple hundred years old.
- RyanMcGreal 16y ago
  People tend to over-invest in negative externalities (because someone else pays part of the cost) and under-invest in positive externalities (because someone else enjoys part of the benefit). Pollution and climate change are two stark examples of the former. Because I don't have to pay my share of health care and infrastructure costs for the exhaust coming out of my car, I will tend to buy a bigger car than I would if the cost of that car included those externalized costs. Gas and carbon taxes are mechanisms to internalize those negative externalities. They create an incentive for drivers to buy more fuel-efficient vehicles, which creates an incentive for automakers to manufacture more fuel-efficient vehicles. This is why European cars are on average much smaller and more fuel efficient than American cars, despite the fact that Europeans and North Americans drive roughly the same annual distance (17,000 miles and 18,000 miles, respectively.) Another mechanism is the American CAFE system, which arguably does a worse job because it gives automakers an incentive to find loopholes in vehicle designations. We can thank CAFE for the preponderance of SUVs on the market. On the other side of the coin, education has a positive externality because some of the benefits of an individual's education accue to society as a whole. Given straight market forces, individuals will on aggregate under-invest in their own education, and the economy as a whole will suffer from a lower mean worker productivity. Every industrialized country quickly landed on universal public education because the aggregate benefits to productivity that come from a universally educated populate more than offset the higher cost to educate everyone. That is, even though average taxes are higher to help pay for education, average incomes are higher still.

RyanMcGreal 16y ago

Also of interest is Jonathan Haidt's TED Talk on the different moral foundations of liberals and conservatives: http://www.ted.com/talks/jonathan_haidt_on_the_moral_mind.html http://www.ted.com/talks/jonathan_haidt_on_the_moral_mind.ht...