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> Supposedly, the free market should correct this when consumers stop buying the flawed product. Any free market purist will tell you that all transactions mus

> Supposedly, the free market should correct this when consumers stop buying the flawed product. Any free market purist will tell you that all transactions must be both mutually consenting and informed. If these conditions are not met, it is the governments job to step in.

MichaelApproved 7y ago
Genuinely curious to see a source for that claim.
- rocelot 7y ago
  I think the implication is that, to quote Eric Weinstein from that Kayfabe article, "economic theory ... currently uses as it's central construct a market model based on assumptions of perfect information."
  - QuesnayJr 7y ago
    Does he say that? Because it's very wrong -- economics of imperfect information has been a dominant theme of microeconomics for the last 50 years. They gave Akerlof, Stiglitz, and Spence the Nobel back in 2001. They gave a second Nobel in 2007 for mechanism design, which is on when and how you can design institutions so that imperfect information doesn't wreck everything.
- dahfizz 7y ago
  Here is an excerpt from Milton Friedman: Fundamentally there are only two ways in which the activities of a large number of people can be co-ordinated: by central direction, which is the technique of the army and of the totalitarian state and involves some people telling other people what to do; or by voluntary co-operation, whch is the technique of the market place and of arrangements involving voluntary exchange. The possibility of voluntary co-operation in its turn rests fundamentally on the proposition that both parties to an exchange can benefit from it. If it is voluntary and reasonably well informed, the exchange will not take place unless both parties do benefit from it.[1] You will see a similar disclaimer in any bit of free-market libertarian thought, because you can't have voluntary exchange without informed consent. If transactions without informed consent are taking place, it is easy to argue that someone's property rights are being violated. Any libertarian since John Locke will tell you that protecting your rights is the first and foremost job of government[2]. [1] https://oll.libertyfund.org/pages/friedman-on-capitalism-and-freedom https://oll.libertyfund.org/pages/friedman-on-capitalism-and... [2] https://plato.stanford.edu/entries/locke-political/ https://plato.stanford.edu/entries/locke-political/
minikites 7y ago
Now name any transaction more complicated "I agree to pay you $3 for this bunch of asparagus" where the buying side has as much information as the selling side. It seems to me the government should be involved in almost every transaction.
- steerablesafe 7y ago
  Is that asparagus bio though? I can't tell by just looking at it. And I definitely can't tell if it tastes any good.
- dahfizz 7y ago
  > It seems to me the government should be involved in almost every transaction. Depending on your definition of "involved", every libertarian I know would agree with you. Most people's conception of libertarianism is a massive straw man. I promise we are not as insane as you've been lead to believe ;)
  - DonHopkins 7y ago
    Actually you are, because your pronoun "we" includes all the people whose conception of libertarianism is a massive straw man, but claim to be libertarians themselves. Which is now most self-described "libertarians", and a large swath of the Republican party. Now days it's just a meaningless euphemism people use when they don't want to admit they voted Republican. And the few libertarians who actually know what it means are usually quite cruel and heartless, fighting tooth and nail against universal heath care even today, because their ideological principles outweigh their empathy and humanity. But as a result of your ideological evangelism, you own all the self-described "libertarians" who your philosophy appeals to simply because they want to hurt and punish poor people, but don't understand what it "really means". Sorry if this annoying inconvenient health crisis has knocked the blocks out from under your religious philosophy (and that the invisible hand of the market saw it necessary to bitch slap Rand Paul into quarantine after he downplayed the severity Coronavirus, got it himself, tested positive, and continued to selfishly spread it while awaiting the predictably positive results), but we NEED government intervention and universal health care right now to save people's lives, so please spare us the "no true Scotsman" lecture.
cryptica 7y ago
It's very rare that both parties engaged in any transaction are equally informed. But often the government is even less informed so they are utterly useless in terms of intervention. The best the government can do and should do is reduce power imbalances and market monopolies which give rise to information asymetry. Reducing wealth inequality should be the government's priority. Money can buy trust. People are too focused on presentation instead of substance. People these days are incapable of seeing substance where it exists and they are easy to fool into seeing it where there is none.
- AnthonyMouse 7y ago
  "Equally informed" isn't actually required. All you need is to be informed enough to make a reasonable decision. If you know one of the products is less secure but $10 cheaper, you know essentially what you need to know even if the manufacturers have a ton of information about specific algorithms used and electrical impedance that you don't know or understand but that don't change the high level conclusions anyway. It's only when the customer doesn't even have the information that the product which is $10 cheaper is also less secure that you run into a problem.
dhosek 7y ago
>Any free market purist will tell you that all transactions must be both mutually consenting and informed. If these conditions are not met, it is the governments job to step in. I don't think such a person exists outside of some libertarian fantasies. In practice, the right side of the political spectrum is about preserving the free market insofar as it protects incumbent wealth.

MichaelApproved 7y ago

Genuinely curious to see a source for that claim.

rocelot 7y ago
I think the implication is that, to quote Eric Weinstein from that Kayfabe article, "economic theory ... currently uses as it's central construct a market model based on assumptions of perfect information."
- QuesnayJr 7y ago
  Does he say that? Because it's very wrong -- economics of imperfect information has been a dominant theme of microeconomics for the last 50 years. They gave Akerlof, Stiglitz, and Spence the Nobel back in 2001. They gave a second Nobel in 2007 for mechanism design, which is on when and how you can design institutions so that imperfect information doesn't wreck everything.
dahfizz 7y ago
Here is an excerpt from Milton Friedman: Fundamentally there are only two ways in which the activities of a large number of people can be co-ordinated: by central direction, which is the technique of the army and of the totalitarian state and involves some people telling other people what to do; or by voluntary co-operation, whch is the technique of the market place and of arrangements involving voluntary exchange. The possibility of voluntary co-operation in its turn rests fundamentally on the proposition that both parties to an exchange can benefit from it. If it is voluntary and reasonably well informed, the exchange will not take place unless both parties do benefit from it.[1] You will see a similar disclaimer in any bit of free-market libertarian thought, because you can't have voluntary exchange without informed consent. If transactions without informed consent are taking place, it is easy to argue that someone's property rights are being violated. Any libertarian since John Locke will tell you that protecting your rights is the first and foremost job of government[2]. [1] https://oll.libertyfund.org/pages/friedman-on-capitalism-and-freedom https://oll.libertyfund.org/pages/friedman-on-capitalism-and... [2] https://plato.stanford.edu/entries/locke-political/ https://plato.stanford.edu/entries/locke-political/

minikites 7y ago

Now name any transaction more complicated "I agree to pay you $3 for this bunch of asparagus" where the buying side has as much information as the selling side. It seems to me the government should be involved in almost every transaction.

steerablesafe 7y ago
Is that asparagus bio though? I can't tell by just looking at it. And I definitely can't tell if it tastes any good.
dahfizz 7y ago
> It seems to me the government should be involved in almost every transaction. Depending on your definition of "involved", every libertarian I know would agree with you. Most people's conception of libertarianism is a massive straw man. I promise we are not as insane as you've been lead to believe ;)
- DonHopkins 7y ago
  Actually you are, because your pronoun "we" includes all the people whose conception of libertarianism is a massive straw man, but claim to be libertarians themselves. Which is now most self-described "libertarians", and a large swath of the Republican party. Now days it's just a meaningless euphemism people use when they don't want to admit they voted Republican. And the few libertarians who actually know what it means are usually quite cruel and heartless, fighting tooth and nail against universal heath care even today, because their ideological principles outweigh their empathy and humanity. But as a result of your ideological evangelism, you own all the self-described "libertarians" who your philosophy appeals to simply because they want to hurt and punish poor people, but don't understand what it "really means". Sorry if this annoying inconvenient health crisis has knocked the blocks out from under your religious philosophy (and that the invisible hand of the market saw it necessary to bitch slap Rand Paul into quarantine after he downplayed the severity Coronavirus, got it himself, tested positive, and continued to selfishly spread it while awaiting the predictably positive results), but we NEED government intervention and universal health care right now to save people's lives, so please spare us the "no true Scotsman" lecture.

cryptica 7y ago

It's very rare that both parties engaged in any transaction are equally informed. But often the government is even less informed so they are utterly useless in terms of intervention. The best the government can do and should do is reduce power imbalances and market monopolies which give rise to information asymetry. Reducing wealth inequality should be the government's priority. Money can buy trust. People are too focused on presentation instead of substance. People these days are incapable of seeing substance where it exists and they are easy to fool into seeing it where there is none.

AnthonyMouse 7y ago
"Equally informed" isn't actually required. All you need is to be informed enough to make a reasonable decision. If you know one of the products is less secure but $10 cheaper, you know essentially what you need to know even if the manufacturers have a ton of information about specific algorithms used and electrical impedance that you don't know or understand but that don't change the high level conclusions anyway. It's only when the customer doesn't even have the information that the product which is $10 cheaper is also less secure that you run into a problem.

dhosek 7y ago

>Any free market purist will tell you that all transactions must be both mutually consenting and informed. If these conditions are not met, it is the governments job to step in. I don't think such a person exists outside of some libertarian fantasies. In practice, the right side of the political spectrum is about preserving the free market insofar as it protects incumbent wealth.