It’s really confusing that you wrote a big list of bad things and I think your argument is that these are good? Somehow it would be bad if people could buy individual foods regardless of distance and knew the exact contents of them and their nutritional value? It would be bad if multiple car manufacturers made similar cars and sold them in straightforward ways?
(And the restaurant example is talking about something completely different than market competitition)
I think this series is fundamentally flawed due the things I mention in my comment on your previous post (short version: you’re using the world “value” to mean something like “monopoly rents” and then getting confused that competition is destroying monopoly rents but good things still exist). If perfect competition causes farmers to produce and sell food for the price that it would cost their buyers to produce and sell food, then food still gets produced and food is still traded with people who would rather produce something else. We just have less income/effort/work inequality.
Things are not inherently or entirely good or bad. In some circumstances they are good for some things, in other (or the same) circumstances they are bad for others. “Bad” things being good or “good” things doing harm is common, and the confusion is in us finding it confusing. I do wonder if I should have found a way to say this more explicitly or clearly, or if I could edit to that effect.
Yes, on the margin and by default, of course these things are all bad for market efficiency. I am trying to say two things.
1. That actual markets are almost always inefficient in many important ways.
2. That market inefficiency can enable forms of value (and production) that are impossible without it, and this protects against what is described in Meditations on Moloch. Whereas sufficiently strong efficiency wipes this out.
Or: Equality, liberty, fraternity. Pick at most two, and I’m not convinced you can pick more than one.
I think I misread this article at first, and it’s really just the same confusion as the previous article. These are all bad things which are “good” because monopoly rents are good.
I’m guessing this is based on Meditations on Moloch (5) “Capitalism”:
Imagine a capitalist in a cutthroat industry. He employs workers in a sweatshop to sew garments, which he sells at minimal profit. Maybe he would like to pay his workers more, or give them nicer working conditions. But he can’t, because that would raise the price of his products and he would be outcompeted by his cheaper rivals and go bankrupt. Maybe many of his rivals are nice people who would like to pay their workers more, but unless they have some kind of ironclad guarantee that none of them are going to defect by undercutting their prices they can’t do it.
I think Scott is (unknowingly) pointing at a problem with barriers to competition on the worker side and thinking it’s a problem with competition on the business side.
This becomes more clear if you turn the sweatshop into a worker-owned business. The same things Scott mentions still apply. Even though there’s no bad guy to oppress them, the workers still can’t raise wages because they’re competing with other businesses. So why are they working at this business, and why don’t they enter a different field? In the real world, the answer is that there are a lot of barriers in the way (imperfect competition), but if we’re assuming perfect competition, then they should be able to switch to any other business with no effort (or they could produce their own food, shelter and luxuries), which implies that there is no better business to be in.
The problem in this example is that the entire world is a dystopia where no one produces anything more valuable than factory clothes. With monopoly rents, our workers could potentially make themselves better off than other workers in the same world, but it’s a zero-sum game and it’s definitely not obvious that that would be better.
Note: Our world was a dystopia similar to this once, although without perfect competition. We didn’t get out of it by reducing competition (we’re more capitalist now than we were then), but by improving efficiency. The thing left out of money-centric examples is the actual stuff being produced, and we produce way more stuff now than we did at the beginning of the industrial revolution.
The concept of super-perfect competition is being introduced exactly because exit, or switching industries/jobs/etc, really isn’t free and often is seen by people as prohibitively expensive on both sides.
As for the rest, I’m basically giving up trying to explain further to those raising objections, because it is not central to what happens later in the sequence that it be settled—I hope that once we’re done, people will see what I was going for and the disagreements will mostly dissolve. If they don’t, so be it, but it’s not worth exploring further.
It’s really confusing that you wrote a big list of bad things and I think your argument is that these are good? Somehow it would be bad if people could buy individual foods regardless of distance and knew the exact contents of them and their nutritional value? It would be bad if multiple car manufacturers made similar cars and sold them in straightforward ways?
(And the restaurant example is talking about something completely different than market competitition)
I think this series is fundamentally flawed due the things I mention in my comment on your previous post (short version: you’re using the world “value” to mean something like “monopoly rents” and then getting confused that competition is destroying monopoly rents but good things still exist). If perfect competition causes farmers to produce and sell food for the price that it would cost their buyers to produce and sell food, then food still gets produced and food is still traded with people who would rather produce something else. We just have less income/effort/work inequality.
Things are not inherently or entirely good or bad. In some circumstances they are good for some things, in other (or the same) circumstances they are bad for others. “Bad” things being good or “good” things doing harm is common, and the confusion is in us finding it confusing. I do wonder if I should have found a way to say this more explicitly or clearly, or if I could edit to that effect.
Yes, on the margin and by default, of course these things are all bad for market efficiency. I am trying to say two things.
1. That actual markets are almost always inefficient in many important ways.
2. That market inefficiency can enable forms of value (and production) that are impossible without it, and this protects against what is described in Meditations on Moloch. Whereas sufficiently strong efficiency wipes this out.
Or: Equality, liberty, fraternity. Pick at most two, and I’m not convinced you can pick more than one.
I think I misread this article at first, and it’s really just the same confusion as the previous article. These are all bad things which are “good” because monopoly rents are good.
I’m guessing this is based on Meditations on Moloch (5) “Capitalism”:
I think Scott is (unknowingly) pointing at a problem with barriers to competition on the worker side and thinking it’s a problem with competition on the business side.
This becomes more clear if you turn the sweatshop into a worker-owned business. The same things Scott mentions still apply. Even though there’s no bad guy to oppress them, the workers still can’t raise wages because they’re competing with other businesses. So why are they working at this business, and why don’t they enter a different field? In the real world, the answer is that there are a lot of barriers in the way (imperfect competition), but if we’re assuming perfect competition, then they should be able to switch to any other business with no effort (or they could produce their own food, shelter and luxuries), which implies that there is no better business to be in.
The problem in this example is that the entire world is a dystopia where no one produces anything more valuable than factory clothes. With monopoly rents, our workers could potentially make themselves better off than other workers in the same world, but it’s a zero-sum game and it’s definitely not obvious that that would be better.
Note: Our world was a dystopia similar to this once, although without perfect competition. We didn’t get out of it by reducing competition (we’re more capitalist now than we were then), but by improving efficiency. The thing left out of money-centric examples is the actual stuff being produced, and we produce way more stuff now than we did at the beginning of the industrial revolution.
The concept of super-perfect competition is being introduced exactly because exit, or switching industries/jobs/etc, really isn’t free and often is seen by people as prohibitively expensive on both sides.
As for the rest, I’m basically giving up trying to explain further to those raising objections, because it is not central to what happens later in the sequence that it be settled—I hope that once we’re done, people will see what I was going for and the disagreements will mostly dissolve. If they don’t, so be it, but it’s not worth exploring further.