pull down to refresh
93 sats \ 52 replies \ @SimpleStacker 5 Aug \ parent \ on: Jeff Bezos’s Yacht: Driver of Economic Activity econ
Got it. The fallacy in the broken window fallacy is "we should break this perfectly good window in order to generate economic activity," which is clearly a fallacy
I still maintain that there's a flavor of this. It's kinda like if a billionaire decides to privately fund the construction of a bridge to nowhere. We all understand why it's bad if the government decides to do that, but if a billionaire does that it's ok because it's a private choice? A lot of weight is being hung on the private surplus of said billionaire.
We all understand why it's bad if the government decides to do that, but if a billionaire does that it's ok because it's a private choice?
A waste of resources is a waste of resources, no matter which way you cut it. However, if a billionaire decides to waste his own resources, isn’t that a free choice he can make? If he makes too many of those kinds of choices, he will not remain wealthy for long, will he? Perhaps this is why we say, “Rags to riches to rags in three generations!”
reply
Yes! The revealed preference of voluntary exchange is the difference.
Extremely wealthy people can afford extravagant excesses and there's no accounting for taste.
reply
Extremely wealthy people can afford extravagant excesses and there's no accounting for taste.
I think this crystallizes one of my main gripes with economists.
It's true that there's no accounting for tastes, and therefore we don't account for it in our measures of surplus which (rightly) try to import as few subjective assumptions as possible.
But saying that something increases economic surplus, broadly defined, is not the same thing as saying this is good. When people write articles defending Jeff Bezos's yacht as morally good, I just think it rings hollow to most people and it makes economists look like dicks.
I think I'd say something like, "I don't think this is the best use of resources, but Bezos has the right to spend his lawfully obtained wealth how he wants, and look it does employ a lot of people and grow the economy in all these ways. So even if I don't particularly like it, I can't really argue with it. What would you rather do? Tell people what they can and can't spend their money on?"
They'd probably go into some rant about how billionaires shouldn't exist, but then we can talk about how Bezos's wealth was obtained in the process of real value creation.
reply
That's a completely fair perspective. Obviously, we are each entitled to our personal normative assessments of how resources are deployed and are under no obligation to approve of how any spends their money.
I think the point of articles like this is to point out that Bezos is transferring his purchasing power to a whole bunch of people who make his yachting possible. One way or another, that purchasing power belongs to Bezos and is his to transfer to others on whatever terms he wants.
The question then is whether those recipients of Bezos' wealth are particularly less deserving than anyone else.
reply
If they did the work for the companies producing the ship, outfitting it, supplying it and running it, they deserve it! They earned it and Bezos wants to pay it. It is all voluntary.
reply
Haha, I just remembered that you're the Minimalism is Pro-Social guy :)
reply
All voluntary exchanges make the world better (in expectation), but some voluntary exchanges make the world more better.
reply
Of course, some exchanges are better than others. Personally, spending $500 million on a boat, is a tad extravagant. I didn’t spend that much on my 23 foot sailboat, and I still enjoy the hell out of it.
reply
it makes economists look like dicks.
Can’t disagree with that. Trying to be morally neutral does make people look like dicks no matter who they are. Sometimes, you just have to say something about some of this isht.
reply
Personally, I kind of like that we often look like dicks for trying to dissect tricky subjects that make normal people angry.
Willingness to entertain unpalatable views is my favorite trait that most economists share.
reply
This is definitely a guilty pleasure of economists: being the "akshually" guy in the room
reply
I was thinking about our common modelling practice of dividing the population into "high types" and "low types".
reply
Yes, what are high types and what are low types? These classifications look suspiciously collectivist.
reply
It's a modeling gimmick to classify people into low skill and high skill groups, with the simple binary being chosen simply for mathematical convenience. It lets the model generate heterogeneity in outcomes such as high types getting degrees and low types not
Oh, sometimes I get positive pleasure from pissing off progressive/lefty/collectivist/Marxist/socialist/communist/murderers. I like to see their red faces and animated motions, it is quite amusing.
reply
And there is nothing we can do about it, even if we wanted to do something. They can do what they want, and I don’t care! It is economic use of resources.
reply
If it's not an economic use of resources that would have to come from how the wealth was obtained in the first place.
reply
I am just a bit confused about Bezos and the origin of Amazon. Who were his original backers that he could lose billions of dollars monopolizing the book market and spreading out from there? I made a lot of money at one time during the .com crash by buying puts on QQQ and AMZN. Did he make that company on the economic means or the political means?
reply
I don't know much about it. At that level, there's no way to avoid it being a mix of both, but he also had plenty of government obstacles to overcome.
reply
I’m curious as how he overcame the book selling monopoly allegations thrown against him. He really tied up the industry into a very small bag and walked away with it. He almost got my favorite Science Fiction Bookstore, too!!
reply
You betcha!!! Actually, it feels good sometimes and definitely gets some peoples blood pumping!
reply