Best explanation for Weimar Republic Inflation I ever read....

What the heck is wrong with people pursuing their own 'voluntary desires'?

Are you saying the government knows what people need better then they do?

 

So, are you saying that bigger states are better than smaller states? What about Luxembourg?

 

or it would break up into 330 million nations but this is not what conservative libertarians propose so why think about it. Firstly, they would like to see violent monopolistic central govt shrink by about 50%.

 

well Lux could never defend itself in war so it would need very very tight treaties to be sustainable

 

its odd but totalitarian countries have advantages and can get huge resource bases since they don't mind killing others to get them. that means others have to match to have equal size militaries.

 

And you point is...?

 

No that's pretty much the opposite of what I said.

You seem to think that either you pursue your own interests or you are forced to do what other people want you to do.

It's possible to live in a society where there is some of both.

 

Some of both? Some of people threatening others in order to force them to do their bidding? That's not economics.

 

Let's say you participate in a tug of war with 10 people on each side. Everyone earns $100. The winning team gets a bonus of $50.

One team has an agreement between its members that they are free to do as they wish, their cooperation is voluntary

The other team has a rule that once you commit, emergencies aside if you drop out you will be fined $100.

The team that volunteers find out that one member decided not to come because he had a date. He didn't lose anything because he chose not to come, but everyone else loses at least $100

On the other team, there is a penalty imposed by the group that, all things being equal, makes it more difficult not to participate.

I'm saying that a coordinated society where there are penalties for not contributing will (all other things being equal) ALWAYS outperform a group of volunteers over a long enough timeline.

 

I didn't make a value judgment, merely an observation.

 

Take this real-life example.

This is an actual social experiment.

People are brought into a room and each given $100. They are told they can keep it or put some or all of it into a community pot. The organizer doubles the pot and spits the money between all the people evenly.

Obviously, the best situation would be where everyone puts in everything and has their money doubled. But what if you put in 1/2 of your money and everyone else puts in everything? You get even more!

People tend to figure this out quickly. It only takes one free rider before others start to do the same. In the first round of the game, people, on average, tend to give just over 1/2, but by the 6th round are giving about 25%.

Now, in the 7th round, there is a new rule added. You can take a portion of your money and put it in a separate pot and use it to punish other players (presumably the person that has the most money spent to "punish them" would get nothing). So what happens? In the 7th round, the average put in by each player rises to 60%. Six rounds later the average sits at just over 80%.

The fact is you don't just let yourself down when you choose not to participate, your non-participation affects others. This is why we have punitive systems, as humans are more productive in those systems. Since we live in a world of competition where there are other groups would take much, much more than 25% of your paycheck and give you no representation whatsoever. Here you have representation. You have freedom of speech, you can encourage others to think as you do and vote for those you that share your ideas.

EDIT: At the other extreme, you could have a man with a gun who threatens to shoot you if you don't pull the rope. And threatens to beat you if you don't win and regardless you get nothing.

See how there is a middle ground between all volunteer and all force?

 

You didn't address my point, which was that using the threat of violence to coerce people to act as you wish isn't economics.

 

1) Your final statement is TOTALLY unprovable. So saying it 'will ALWAYS outperform' is silly and erroneous. You are just guessing.

2) Communism gave penalties for not performing properly and it largely removed freedom of choice...and it was a disaster.
Forcing people to do something removes their desire to do it. That is why the private sector usually does things far more quickly and efficiently then government.

3) Your system is morally wrong. Unless the people overwhelmingly voted for such a system, it is immoral to impose it. And thus, people will resist and fight it every step of the way.
And I GUARANTEE you, Americans would not agree to it.

4) BTW, if the tug-of-war people were smart, they would just all agree before hand to split the winning $50 each to everyone (so they each got $25). Then just have one team pretend to beat the other team and presto...everyone profits.
You underestimate people if you think they will always follow the rules.

 

He isn't guessing. It's an accepted aspect of economics: free riding will necessarily harm well-being. Simple reference to public good provision really

 

Yes he is guessing. The only way he could say he knew is if he had real world examples to call upon and they ALWAYS came out the way he said. He does not have those examples, so he cannot know the outcome is ALWAYS a certain way.
You cannot know something that has not been factually and unbiasedly proven.
Plus, saying something will 'ALWAYS' work out a certain way is ridiculously unscientific. One can not know ANYTHING will ALWAYS end up a certain way...their can be unforeseen circumstances.

And his whole argument is pointless anyway as Americans are surely not going to agree to such a system.

 

He isn't. The negative impact of free riding is a well known phenomenon. The only debate is on the extent of the negative effect. For example, through the lighthouse analysis spawned by the likes of Coase, we can reject the notion of a binary: i.e. provision of a public good, or zero provision via the market. However, the effects are still undoubtedly negative.

The economic approach is based on combining theory and evidence (quantitative or qualitative). It doesn't proof, it tests hypothesis. Free riding theoretically shows that the original statement is correct. It is confirmed by the evidence.

You're stating that Americans are against rationality. I know they can be a strange lot, but let's not get carried away. For example, they have welcomed other public good delivery such as national defence provision.

 

Lol...are you seriously suggesting that an outcome of a certain event will ALWAYS have the exact, same result...forever...no matter how many times it happens?

Yes or no?

BTW, if your answer is 'yes', then you would make a lousy scientist/economist...and you are a complete waste of my time on this subject.

 

I am stating the obvious: if there are free riders, then public goods will be underprovided. This is Econ 101!

You've already stated that you don't start from a point of knowing any economics. You've attacked a fellow because he used economics correctly. Free riding does harm economic well-being. Even slobbering American right wingers acknowledge that when they demand investment in the US military forces. Why can't you?

 

Is that a yes or a no to my question?

(I figured you would not dare answer the question)

Show me EXACTLY where I typed that.

BTW...you cannot. You made it up (I have never even thought such a ridiculous statement).

So noted.

 

Your question was misleading. I've brought it back to the obvious: (1) The original statement was correct and it supported by Econ 101; (2) You've ignored Econ 101, despite free riding behaviour being well understood as the explanation for underprovision of public good.

Your guff about common sense and not needing to know about different schools of though ("I don't believe in macroeconomic 'schools' or theories or models. I believe in common sense")

You seem to want to dodge from the fact that you have attacked someone purely for referring to Econ 101 correctly.

 

@DennisTate

USA cannot fix the world. While I believe your goals are honorable, unless they are extremely profitable, they just won't happen. Bitcoin, gold or any other standard will not help. Those who want to dominate will find a way to allow them as much control of monetary supplies and distribution as is humanly possible.

I believe the ideals of this nation when it was founded were a longshot at best. They relied on the "good" in humanity. There truly is none. There are only degrees of evil.

 

I will ask you again:

are you seriously suggesting that an outcome of a certain event will ALWAYS have the exact, same result...forever...no matter how many times it happens?

Yes or no?

 

I will say, I don't always agree with you.

But you seem a likeable chap with good intentions.

A rare thing around most, chat forums...sadly.

 

You can continue to demand misleading questions but it won't get you anywhere. Again, you have attacked someone who has simply referred to accepted comment in Econ 101. You have one of two reactions. You can effectively backtrack, or you can dismiss the relevance of Econ 101. Which one are you going for?

 

LOL.

Fine, so not only do you put words in people's mouths...you cannot seem to get it together enough to answer mind-bogglingly, simple questions.

(by the way, I was positive you would not answer...your type rarely does. You see, you don't dare answer something that you fear might blow up your whole premise.)

So noted.

Plus, you are on my ignore list. I will not waste my time with people who not only refisecto answer simple questions but who also put words in my mouth.

Have a nice day.