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And stimulating local economies is a problem... why?

• whatshisface 6y ago
  All expenditures stimulate the economy equally, as measured by the "marked bills" theory. That means the only way to compare them is to evaluate opportunity costs. Spending a million bucks on constructing a big hole in the middle of nowhere, and performing an important infrastructure revitalization, will both put dollars in the hands of laborers, and thereby grocery stores and so on, at the same rate. That's why all of the useful parts of the discussion are on the specific, immediate consequences; the distant consequences are the same no matter what you do.
  • iso1631 6y ago
    > the distant consequences are the same no matter what you do. Three things 1) Spend the money on blackjack and hookers 2) Spend the money on a new bridge 3) Burn the money on a bonfire for giggles Those three have very different "distant consequences"
    • whatshisface 6y ago
      1) Money ends up in the local economy 2) Money ends up in the local economy 3) Currency deflates, making all owners of currency richer, and as long as nobody expects deflation to continue, stimulates the economy.
      • iso1631 6y ago
        In the case of (2) there is a new bridge which increases productivity in the long term In the case of (1) there is a no bridge You've already disproven your "All expenditures stimulate the economy equally" claim with your explanation of (3)