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> but because of various market failures and collusion that happened in practice. No. The pencil is built because of the incentives (read: potential for profit

> but because of various market failures and collusion that happened in practice. No. The pencil is built because of the incentives (read: potential for profits) for each of the people involved. The lighthouse keeper maintains the lighthouse to earn a salary. The truck driver earns his/her paycheck based on milage&tonage hauled. The entrepreneur bought the rights to log the land because he/she believed he could make a buck. Etc. I, Pencil is not a story of cooperating for social/feel-goody sake - but rather for individual incentives all along the way. The million people involved in making that pencil - none of which knows any of the others. I, Pencil is a story that shows government intervention is not needed to build the pencil.

deogeo 7y ago
> No. The pencil is built because of the incentives (read: potential for profits) for each of the people involved. I never claimed otherwise, so that 'no' is unnecessary. > I, Pencil is a story that shows government intervention is not needed to build the pencil. No-one claims government intervention is needed to build pencils or more complex goods. But it is needed to, for example, prevent corporations from polluting rivers with mercury: https://en.wikipedia.org/wiki/Minamata_disease https://en.wikipedia.org/wiki/Minamata_disease The whole story is nothing more than an attack on an implied strawman.
- davidw 7y ago
  > The whole story is nothing more than an attack on an implied strawman. I think when it came out, the world was a very different place. A large chunk of the world lived in command economies (USSR, China, etc...), and even in the west, where WWII and the massive government involvement in the economy was a very recent memory, the notion that someone could just calculate all the pieces better than the market probably wasn't quite so foreign as it seems today.
  - Gibbon1 7y ago
    I probably can't find it now but 15 years ago read an essay that made a case that 'the pencil' was complete bullshit when it was published. And is even more so today. AKA Pencil manufacturing from farming and harvesting cedar to making the steel for the metal band that holds the eraser is vertically integrated.
    - droitbutch 7y ago
      Without seeing your article and without at least providing some of the supporting reasons why the article arrives at this conclusion - your argument makes no headway into disproving I, Pencil. The pencil today, as are many other products, is produced by the free market and many many entities along the way. Focusing on whether companies vertically integrate miss the bigger point that it is free markets and Capitalism which provide us with the world we have behind us in the Western world.
  - anoncake 7y ago
    Ironically, we've got a lot better at calculating things since then.
davidw 7y ago
It's almost as if... both have a role to play. It's a wonderful illustration of how disparate people come together to produce something. At the same time, it's also nice to have some rules and regulations and people who enforce them so that, say, one of the suppliers tries to start using toxic ingredients in the pencil's paint, and gets thrown in jail for it.
- roenxi 7y ago
  I was about to write a short post about the lead that I assumed was in early lead pencils, but it turns out [0] that there never was any lead in lead pencils and they are humorously mis-named. [0] https://en.wikipedia.org/wiki/Pencil#Discovery_of_graphite_deposit https://en.wikipedia.org/wiki/Pencil#Discovery_of_graphite_d...
simonh 7y ago
> I, Pencil is a story that shows government intervention is not needed to build the pencil. Not just building pencils but also delivering the mail as one given example, in fact it explicitly broadens the scope of its argument to “...tens of thousands of other things”. ‘I Pencil’ is explicitly an argument against the need for government intervention and planning in general, as it makes very clear at the end - “The lesson I have to teach is this: Leave all creative energies uninhibited”. It is an argument that creating pencils and many other essential activities can, and implicitly should occur “...in the absence of governmental or any other coercive masterminding”. As deogeo pointed out in reality governmental masterminding made many clear and beneficial contributions to the efficiency, safety and sustainability of the pencil’s manufacture. It’s argument that no masterminding occurred is in practice not strictly true. We can argue about how necessary such contributions are, but I don’t see how we can argue they are irrelevant to the discussion when ‘I Pencil’ so clearly broadens the scope of its claims. If I Pencil were to stick to being an eulogy to creative market forces that would be fine. That aspect of its exposition is well reasoned and compelling, but it completely fails to address the issue of externalities. We don’t need government or regulation to have pencils, we need it to also have other things which market forces frequently despoil or fail to provide. Worker safety, sustainable natural resources, etc. That’s what deogeo is talking about.
TheOtherHobbes 7y ago
That's possibly true for a pencil. It's demonstrably not true for large game-changing R&D projects which open up entirely new sectors for innovation.

deogeo 7y ago

> No. The pencil is built because of the incentives (read: potential for profits) for each of the people involved. I never claimed otherwise, so that 'no' is unnecessary. > I, Pencil is a story that shows government intervention is not needed to build the pencil. No-one claims government intervention is needed to build pencils or more complex goods. But it is needed to, for example, prevent corporations from polluting rivers with mercury: https://en.wikipedia.org/wiki/Minamata_disease https://en.wikipedia.org/wiki/Minamata_disease The whole story is nothing more than an attack on an implied strawman.

davidw 7y ago
> The whole story is nothing more than an attack on an implied strawman. I think when it came out, the world was a very different place. A large chunk of the world lived in command economies (USSR, China, etc...), and even in the west, where WWII and the massive government involvement in the economy was a very recent memory, the notion that someone could just calculate all the pieces better than the market probably wasn't quite so foreign as it seems today.
- Gibbon1 7y ago
  I probably can't find it now but 15 years ago read an essay that made a case that 'the pencil' was complete bullshit when it was published. And is even more so today. AKA Pencil manufacturing from farming and harvesting cedar to making the steel for the metal band that holds the eraser is vertically integrated.
  - droitbutch 7y ago
    Without seeing your article and without at least providing some of the supporting reasons why the article arrives at this conclusion - your argument makes no headway into disproving I, Pencil. The pencil today, as are many other products, is produced by the free market and many many entities along the way. Focusing on whether companies vertically integrate miss the bigger point that it is free markets and Capitalism which provide us with the world we have behind us in the Western world.
- anoncake 7y ago
  Ironically, we've got a lot better at calculating things since then.

davidw 7y ago

It's almost as if... both have a role to play. It's a wonderful illustration of how disparate people come together to produce something. At the same time, it's also nice to have some rules and regulations and people who enforce them so that, say, one of the suppliers tries to start using toxic ingredients in the pencil's paint, and gets thrown in jail for it.

roenxi 7y ago
I was about to write a short post about the lead that I assumed was in early lead pencils, but it turns out [0] that there never was any lead in lead pencils and they are humorously mis-named. [0] https://en.wikipedia.org/wiki/Pencil#Discovery_of_graphite_deposit https://en.wikipedia.org/wiki/Pencil#Discovery_of_graphite_d...

simonh 7y ago

> I, Pencil is a story that shows government intervention is not needed to build the pencil. Not just building pencils but also delivering the mail as one given example, in fact it explicitly broadens the scope of its argument to “...tens of thousands of other things”. ‘I Pencil’ is explicitly an argument against the need for government intervention and planning in general, as it makes very clear at the end - “The lesson I have to teach is this: Leave all creative energies uninhibited”. It is an argument that creating pencils and many other essential activities can, and implicitly should occur “...in the absence of governmental or any other coercive masterminding”. As deogeo pointed out in reality governmental masterminding made many clear and beneficial contributions to the efficiency, safety and sustainability of the pencil’s manufacture. It’s argument that no masterminding occurred is in practice not strictly true. We can argue about how necessary such contributions are, but I don’t see how we can argue they are irrelevant to the discussion when ‘I Pencil’ so clearly broadens the scope of its claims. If I Pencil were to stick to being an eulogy to creative market forces that would be fine. That aspect of its exposition is well reasoned and compelling, but it completely fails to address the issue of externalities. We don’t need government or regulation to have pencils, we need it to also have other things which market forces frequently despoil or fail to provide. Worker safety, sustainable natural resources, etc. That’s what deogeo is talking about.

TheOtherHobbes 7y ago

That's possibly true for a pencil. It's demonstrably not true for large game-changing R&D projects which open up entirely new sectors for innovation.