Positive externalities - Big gov't supporters argument sought

[ojc02]

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General Sherman's antitrust act.

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Huh?

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Oops, ma bad, I mixed up the Shermans. I type too fast when I'm angry [img]/images/graemlins/smile.gif[/img]

[Borodog]

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I'm not sure what you don't get. Obviously there are a lot of practical and ethical concerns, as with any government program, but the basics are pretty simple. Project X provides $Y of benefits captured by the producer and $Z of benefits beyond his ability to capture. If X costs between Y and Z dollars, it won't get done even though doing it would increase total welfare. If the participants are all known to each other, it's possible that a Coasian solution could be derived, but in most situations, transaction costs would be too large. So, a government solution at least has the potential to increase total welfare with a subsidy.

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Government doesn't make the transaction costs magically disappear. It just makes them a hundred times larger and coercively externalizes them.

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FIXED YOUR PONY.

[Propertarian]

First off, the entire logic of positive externalities is based around the idea that self-interested agents don't have an incentive to create them as opposed to things that have no or negative externalities, because they make as much money either way, even though welfare logically must be increased, all else being equal, if they choose to create things with positive externalities. There is no incentive to solve these things in the market, assuming that the assumptions about human behavior made by mainstream economists are correct.

Second off, I don't see how any of your counter-arguments are relevant in the real world. Companies can always lobby politicans (etc.) attempting to get protectionism for themselves and will always have an incentive until laws exist that would make it illegal to do so, and politicians will always have an incentive to give targeted tax cuts and protectionism (etc.) to companies given the current laws. Arguing against a specific subsidy via the arguments are using is pointless, because it is not a single specific subsidy that is creating the kind of unproductive behavior you are pointing out, but the current conditions/rules of the game.

[bkholdem]

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ojc,

This is a case of government-induced "market failure". The government installs so many hoops that the costs (both monetary and non-monetary) of becoming a doctor are artificially inflated, hence there are too few doctors produced, driving up the cost of healthcare and medical insurance beyond the reach of many. Government then acts to "fix" this problem by creating yet more interventions, i.e. subsidies, at taxpayer expense, to increase the supply of doctors.

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LMAO

Borodog, can you write a post about how they sell it to the public, the marketing of it?

[pvn]

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ojc,

This is a case of government-induced "market failure". The government installs so many hoops that the costs (both monetary and non-monetary) of becoming a doctor are artificially inflated, hence there are too few doctors produced, driving up the cost of healthcare and medical insurance beyond the reach of many. Government then acts to "fix" this problem by creating yet more interventions, i.e. subsidies, at taxpayer expense, to increase the supply of doctors.

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LMAO

Borodog, can you write a post about how they sell it to the public, the marketing of it?

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It's very simple: just tell people that if this regulation is not put in place, millions of people will die because they will be tricked into letting a plumber do open heart surgery on them.

[Borodog]

MY PONY TOO SLOW

[ConstantineX]

Rent-seeking is a huge problem. I think even more so than any of the other ones.

[Nielsio]

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ojc,

This is a case of government-induced "market failure". The government installs so many hoops that the costs (both monetary and non-monetary) of becoming a doctor are artificially inflated, hence there are too few doctors produced, driving up the cost of healthcare and medical insurance beyond the reach of many. Government then acts to "fix" this problem by creating yet more interventions, i.e. subsidies, at taxpayer expense, to increase the supply of doctors.

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LMAO

Borodog, can you write a post about how they sell it to the public, the marketing of it?

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It's very simple: just tell people that if this regulation is not put in place, millions of people will die because they will be tricked into letting a plumber do open heart surgery on them.

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Yeah, the irony is just BLEEDING off of that. I mean, the tricking and all. lol.

[bkholdem]

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ojc,

This is a case of government-induced "market failure". The government installs so many hoops that the costs (both monetary and non-monetary) of becoming a doctor are artificially inflated, hence there are too few doctors produced, driving up the cost of healthcare and medical insurance beyond the reach of many. Government then acts to "fix" this problem by creating yet more interventions, i.e. subsidies, at taxpayer expense, to increase the supply of doctors.

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LMAO

Borodog, can you write a post about how they sell it to the public, the marketing of it?

[/ QUOTE ]

It's very simple: just tell people that if this regulation is not put in place, millions of people will die because they will be tricked into letting a plumber do open heart surgery on them.

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You must be lying. It can't be true. When I was a little kid I was taught to trust the government in school. You must be the crazy one pulling tricks PVN. Government doesn't lie, they protect us! We need them you ungreatful SOB!