7 ms·

He's a criminal. Of course his business is zero sum. His profits and the consumer surpluses of his customers are balanced against the losses to society.

• dllthomas 13y ago
  The claim that his business is zero sum is tremendously more narrow than the one that was made. Even so, it's probably false. Very much criminal activity has a negative sum (eg, smash a window to steal a laptop). It's also perfectly possible for an illegal activity to nonetheless have a positive sum (legislators are imperfect, laws are necessarily generalizations, etc); though we shouldn't expect it in any individual case, I think it's most likely to be the case in a situation like this with a willing exchange of goods (where there clearly is a surplus for two parties).
• randyrand 13y ago
  His business is not zero-sum. It actually creates wealth. People that used to not be able to afford a visit to New York now can.
  • hapless 13y ago
    That is the consumer surplus for his customers. The criminal vendor and his customers are always individually better off, or else no transaction would take place. Society suffers from the externalities of a criminal business.
    • randyrand 13y ago
      Your logic is flawed. This business is not zero sum. It literally creates wealth. Your dollar now buys more than it did before. Taxation is zero-sum. Your dollar that you would have spent literally gets taken from you to be spent somewhere else. No wealth is created. Similarly, no wealth is lost when people evade tax - but we do have less for the government to spend obviously. Also, at a large scale "the customers" are the same as "society." Externalities are an important topic but what are those externalities? Fewer tax dollars, annoyed neighbors, that all I can think of. Both of those are easily solvable problems in a free market. Allow apartment complexes to choose if they allow airBnB. The benefit far outweighs the negatives. There are also positive externalities. We all benefit from sharing our resources. Air BnB should be legalized. That would also get rid of some of the externalities of crime, like paying for prison and enforcement of laws.
      • moocowduckquack 13y ago
        If taxation is used to create infrastructure, then surely it is not zero-sum. Also, examples such as NASA would suggest that certain tax funded activities are hugely positive-sum. http://er.jsc.nasa.gov/seh/economics.html http://er.jsc.nasa.gov/seh/economics.html
        • randyrand 13y ago
          Government is positive-sum (in theory - if used correctly). Taxation is not. If taxation was positive-sum we could just tax everyone 100%, give it back to them, tax it again, and all be incredibly wealthy! Building roads is important and benefits society, but regardless taxation is still zero-sum. Taxation is just a funnel of inlets that eventually go to a bunch of outlets. The money in equals the money out. Nothing was created. benefit = the amount. Zero-sum. The government can spend it on things that are positive-sum, but so can we. Now, lets take roads again, the economic benefit of roads is much much higher than the amount it takes to build and maintain them. Roads create wealth. But taxation is still zero-sum. We as a bunch of private individuals could have paid to have the roads built for all intents and purposes the same price the government can. Obviously that's impractical so we don't do it that way. The positive-sum of government is exactly this -- the organization of community projects among other things. It's a difficult idea to wrap your head around, I know. The government can invest tax dollars, but so can you. Taxation, regardless of what it is spent on is inherently zero-sum by definition. That said, plenty of zero-sum things are incredibly important and worthwhile. Taxation is one of these things.
          • dnautics 13y ago
            Government is positive-sum. Killing all those brown people with drones sure is positive sum!
          • dllthomas 13y ago
            Your reasoning is wrong, here. Taxation is zero-sum in dollars. Trade of dollars and unmodified material goods is also zero sum in those dollars and goods, and can still be positive-sum in utility. If you have X kg gold, and I have $Y, and you value that X kg gold at less than $Y, while I value that X kg gold a more than $Y, we can make a trade, all be subjectively better off - a non-zero sum transaction - and yet there is no more gold and there is no more dollars.
  • kordless 13y ago
    At $500 a night, your comment appears to be false. Additionally, the people that live there will have a harder time competing with people who can afford to live there part time at accelerated rates - which means, on average, the place next door is threatening to drive up rent everywhere around it.
    • randyrand 13y ago
      You can't say I'm false and justify it by citing a single price. What would a hotel have cost? I don't understand your second point at all. But remember, prices are "set" by firms competing for the lowest price/best value, not by "what the market can bear." There should be no reason rents will go up.
      • tych0 13y ago
        It says in the article: the average hotel in NYC is $281/night.
        • toomuchtodo 13y ago
          I can book a decent hotel on HotelTonight [http://www.hoteltonight.com http://www.hoteltonight.com] in New York right now for $99-267/night. Who is paying $500/night?
          • tych0 13y ago
            The people renting from the guy in TFA, which also states that he charges $500/night.
            • toomuchtodo 13y ago
              Ridiculous all around
              • randyrand 13y ago
                It sounds like the flat is extremely nice. $8,000 a month was it? $500 for a night is not all that outrageous compared to an equivalent hotel room.
  • jliptzin 13y ago
    Yes, but it's displacing a potential tenant who'd be paying much less than $500 / night to leave in the apartment.