November 28, 2015

More on inequality and stagnant wages

Filed under: Business, Economics — Tags: — Nicholas @ 02:00

A few months back, Tim Worstall explained why we can soon stop worrying about the rise in income inequality, because the disturbance which caused it in the first place is finally settling out:

We’re constantly told that rising inequality is the greatest threat to the peace and prosperity of the nation. And further, that the stagnant wages of the ordinary working guy and gal are an abomination: as is the increasing amount of the nation’s income going to the already well off. Therefore something must be done. And there’s interesting news for us all. Which is that we don’t have to do anything at all to reverse this trend, the world economy is going to do that for us. We don’t need to change domestic tax rates, start to place tariffs on imports, shout at China for being a currency manipulator, none of the things currently being touted. Because the reason for that income stagnation and rising inequality is itself reversing.

OK, this does rather depend upon agreeing what the original cause of them both was but I think it’s reasonably clear that it is the process of globalisation that has done it. As Branko Milanovic tells us, here’s the winners and losers from globalisation:

Changes in global income from 1988 to 2008

That 75% to 95% of the global income distribution, the people who haven’t done well out of it, is essentially some of the people in the communist transition countries and most of those on below median wages in the rich countries. That latter group being exactly who everyone is worrying about in terms of stagnant incomes. The poor of the world have made out like bandits from globalisation which is why I support it. And, yes, the already rich have done well too.

And the point is, this is exactly what we would expect from having added a couple of billion low wage and low skill workers to the global economy. The low skill and low wage workers already in that global economy aren’t going to do very well, as Charles Goodhart explains via Ambrose Evans Pritchard:

    Prof Goodhart and Manoj Pradhan argue in a paper for Morgan Stanley that this was made even sweeter by the collapse of the Soviet Union and China’s spectacular entry into the global trading system. The working age cohort was 685m in the developed world in 1990. China and eastern Europe added a further 820m, more than doubling the work pool of the globalised market in the blink of an eye. “It was the biggest ‘positive labour shock’ the world has ever seen. It is what led to 25 years of wage stagnation,” said Prof Goodhart, speaking at a forum held by Lombard Street Research.

November 27, 2015

A different view of Uber and other ride-sharing services

Filed under: Business, Politics, Technology — Tags: , , , — Nicholas @ 02:00

Robert Tracinski on Uber as a form of “Objectivist LARP“:

If it sometimes seems like it’s impossible to restore the free market, as if every new wave of government regulation is irreversible, then consider that one form of regulation, which is common in the most dogmatically big-government enclaves in the country, is being pretty much completely dismantled before our eyes. And it’s the hippest thing ever.

I was reminded of this by a recent report about yet another attempt to help traditional taxis compete with “ride-sharing” services like Uber and Lyft: a new app called Arro, which allows you to both hail a traditional taxi and pay for it from your phone. So Arro takes a twentieth-century business and finally drags into the twenty-first century. This certainly might help improve the taxi experience relative to how things were done before. But it won’t fend off Uber and Lyft, because it doesn’t change the central issues, which are political rather than technological.


Uber has been hit with complaints that it’s running “an Objectivist LARP,” a live-action role playing of a capitalist utopia from an Ayn Rand novel. That’s pretty much what it is doing, and the results are awesome. And the benefits don’t stop with more drivers and lower rates. Uber is ploughing a fair portion of its profits into another wave of technological innovation—self-driving cars—that promises to offer even greater improvements in the future.

All of this should counter some of the despair about how to promote free markets, especially among urban elites who have been programmed by their college educations to embrace the rhetoric of the Left. Give them half a chance, and they will flock to capitalist innovations run according to the laws of the market.

The problem is that they don’t want to admit it. That’s where the euphemism “ride-sharing” comes in. To cover up the capitalistic nature of the activity, they tell themselves they’re “sharing” something that they are quite obviously paying for, and paying at market rates. Imagine what could be accomplished if they were just willing to drop the euphemisms and embrace the free market.

November 25, 2015

Food labelling laws and craft brewing … not a match made in heaven

Filed under: Bureaucracy, Business, Health, USA — Tags: , — Nicholas @ 03:00

Eric Boehm on how well-intentioned laws can still have significant and unforeseen negative side-effects:

Brewers are facing the prospect of spending potentially thousands to determine calorie counts for every variety of beer produced. Unless they spend the money to provide the information, breweries may never get their products into chain restaurants, like Buffalo Wild Wings and Applebee’s.

As is often the case with regulations, smaller breweries stand to lose the most.

“A regional craft brewer or a major brewery can spread the cost over a much larger volume of sales and it’s not so unreasonable for them,” said Paul Gatza, a former brewer who now heads the Boulder, Colorado, based Brewers’ Association, an industry group.

“Smaller guys that are just trying to sell a keg or two here or there, they have a decision to make on whether it is worth the additional cost to try to get their beers into chain restaurants,” Gatza told Watchdog.

The Food and Drug Administration is in the process of finalizing menu labeling rules that were part of the Affordable Care Act. Intended to make Americans more aware of their dietary choices, the rules are subject to controversy on several fronts, and the FDA announced in September that implementation of the new rules would be pushed back one full year, until December 2016, as the feds try to work out the kinks.

My favourite local brewery isn’t even a micro-brewery (they’re somewhere between a pico- and a nano-brewery): every week when I drop in, there are three or four new batches ready to sample (and it’s rare that there’s anything left of last week’s offerings). If they had to spend hundreds or even thousands of dollars to comply with detailed labelling requirements for every small batch they brewed, they’d never stand a chance of making a profit. I understand the urge to ensure that people have a chance to avoid ingredients that might make them ill, but this is the sort of regulation that tilts very heavily toward the big companies that have regional or national markets. A thousand dollars per product isn’t even a drop in the bucket to them, while to a small local business, that might be more than their profit margin when you require it be done for everything they produce.

November 22, 2015

QotD: Bargaining in Germany

Filed under: Business, Europe, Humour, Quotations — Tags: , , — Nicholas @ 01:00

On another occasion I listened in the smoke-room of a German hotel to a small Englishman telling a tale which, had I been in his place, I should have kept to myself.

“It doesn’t do,” said the little Englishman, “to try and beat a German down. They don’t seem to understand it. I saw a first edition of The Robbers in a shop in the Georg Platz. I went in and asked the price. It was a rum old chap behind the counter. He said: ‘Twenty-five marks,’ and went on reading. I told him I had seen a better copy only a few days before for twenty — one talks like that when one is bargaining; it is understood. He asked me ‘Where?’ I told him in a shop at Leipsig. He suggested my returning there and getting it; he did not seem to care whether I bought the book or whether I didn’t. I said:

“‘What’s the least you will take for it?’

“‘I have told you once,’ he answered; ‘twenty-five marks.’ He was an irritable old chap.

“I said: ‘It’s not worth it.’

“‘I never said it was, did I?’ he snapped.

“I said: ‘I’ll give you ten marks for it.’ I thought, maybe, he would end by taking twenty.

“He rose. I took it he was coming round the counter to get the book out. Instead, he came straight up to me. He was a biggish sort of man. He took me by the two shoulders, walked me out into the street, and closed the door behind me with a bang. I was never more surprised in all my life.

“Maybe the book was worth twenty-five marks,” I suggested.

“Of course it was,” he replied; “well worth it. But what a notion of business!”

Jerome K. Jerome, Three Men on the Bummel, 1914.

November 20, 2015

We’re in “a terrible, horrible, no good, very bad news cycle for Obamacare”

Filed under: Business, Health, USA — Tags: , — Nicholas @ 04:00

Megan McArdle on the plight of some health insurance companies as they try to offer healthcare policies and still make some sort of profit in the current American market:

… UnitedHealth abruptly said it expected to lose hundreds of millions of dollars on its exchange policies in 2015 and 2016, and would be assessing whether to pull out of the market altogether in the first half of next year.

This was part of a terrible, horrible, no good, very bad news cycle for Obamacare; as ProPublica journalist Charles Ornstein said on Twitter, “Not since 2013 have I seen such a disastrous stream of bad news headlines for Obamacare in one 24-hour stretch.” Stories included not just UnitedHealth’s dire warnings, but also updates in the ongoing saga of higher premiums, higher deductibles and smaller provider networks that have been coming out since open enrollment began.

It now looks pretty clear that insurers are having a very bad experience in these markets. The sizeable premium increases would have been even higher if insurers had not stepped up the deductibles and clamped down on provider networks. The future of Obamacare now looks like more money for less generous coverage than its architects had hoped in the first few years.

But of course, that doesn’t mean insurers need to leave the market. Insurance is priced based on expectations; if you expect to pay out more, you just raise the price. After all, people are required to buy the stuff, on pain of a hefty penalty. How hard can it be to make money in this market?

What UnitedHealth’s action suggests is that the company is not sure it can make money in this market at any price. Executives seem to be worried about our old enemy, the adverse selection death spiral, where prices go up and healthier customers drop out, which pushes insurers’ costs and customers’ prices up further, until all you’ve got is a handful of very sick people and a huge number of very expensive claims.

Some commentators, including me, worried a lot about death spirals in the early days of the disastrous exchange rollout. Some commentators, also including me, have eased off on those fears in recent years. Why the change? Because when the law was passed, I was mostly focused on whether the mandate penalty would be enough to encourage people to buy insurance. Over time, as the exchanges evolved, the subsidies, and the open enrollment limitations, started to look a lot more important than the penalty.


An earnings call like today’s can also be a bargaining tactic. Health insurers are engaged in a sort of perpetual negotiation with regulators over how much they’ll be allowed to charge, what sort of help they’ll get from the government if they lose money, and a thousand other things. Signaling that you’re willing to pull out of the market if you don’t get a better deal is a great way to improve your bargaining position with legislators and regulatory agencies.

That said, strategic positioning is obviously far from the whole story, or even the majority of it. UnitedHealth really is losing money on these policies right now. It really is seeing something that looks dangerously like adverse selection. And frankly, there’s not that much the company can get out of regulators at this point, because the Congressional Republicans have cut off the flow of funds. So while Obamacare certainly isn’t dead, or certain to spiral to its death, it’s got some very worrying symptoms.

Here’s a very disturbing economic issue

Filed under: Bureaucracy, Business, Economics, USA — Tags: , — Nicholas @ 03:00

At Coyote Blog, Warren Meyer shares his concerns about the constantly increasing regulatory burden of American business:

5-10 years ago, in my small business, I spent my free time, and most of our organization’s training time, on new business initiatives (e.g. growth into new businesses, new out-warding-facing technologies for customers, etc). Over the last five years, all of my time and the organization’s free bandwidth has been spent on regulatory compliance. Obamacare alone has sucked up endless hours and hassles — and continues to do so as we work through arcane reporting requirements. But changing Federal and state OSHA requirements, changing minimum wage and other labor regulations, and numerous changes to state and local legislation have also consumed an inordinate amount of our time. We spent over a year in trial and error just trying to work out how to comply with California meal break law, with each successive approach we took challenged in some court case, forcing us to start over. For next year, we are working to figure out how to comply with the 2015 Obama mandate that all of our salaried managers now have to punch a time clock and get paid hourly.

Greg Mankiw points to a nice talk on this topic by Steven Davis. For years I have been saying that one effect of all this regulation is to essentially increase the minimum viable size of any business, because of the fixed compliance costs. A corollary to this rising minimum size hypothesis is that the rate of new business formation is likely dropping, since more and more capital is needed just to overcome the compliance costs before one reaches this rising minimum viable size. The author has a nice chart on this point, which is actually pretty scary. This is probably the best single chart I have seen to illustrate the rise of the corporate state:


November 18, 2015

A maple-flavoured world’s first?

Filed under: Bureaucracy, Business, Cancon, Government — Tags: , — Nicholas @ 04:00

On the Mercatus Centre site, Laura Jones points out an unexpected Canadian first:

Canada recently became the first country in the world to legislate a cap on regulation. The Red Tape Reduction Act, which became law on April 23, 2015, requires the federal government to eliminate at least one regulation for every new one introduced. Remarkably, the legislation received near-unanimous support across the political spectrum: 245 votes in favor of the bill and 1 opposed. This policy development has not gone unnoticed outside Canada’s borders.

Canada’s federal government has captured headlines, but its approach was borrowed from the province of British Columbia (BC) where controlling red tape has been a priority for more than a decade. BC’s regulatory reform dates back to 2001 when a newly elected government put in place policies to make good on its ambitious election promise to reduce the regulatory burden by one-third in three years. The results have been impressive. The government has reduced regulatory requirements by 43 percent relative to when the initiative started. During this time period, the province went from being one of the poorest-performing economies in the country to being among the best. While there were other factors at play in the BC’s economic turnaround, members of the business community widely credit red tape reduction with playing a critical role.

The British Columbia model, while certainly not perfect, is among the most promising examples of regulatory reform in North America. It offers valuable lessons for US governments interested in tackling the important challenge of keeping regulations reasonable. The basics of the BC model are not complicated: political leadership, measurement, and a hard cap on regulatory activity.

This paper describes British Columbia’s reforms, evaluates their effectiveness, and offers practical “lessons learned” to governments interested in the elusive goal of regulatory reform capable of making a lasting difference. It also offers some important lessons for business groups and think tanks outside government that are pushing to reduce red tape. These groups can make all the difference in framing the issue in such a way that it can gain wide support from policymakers. A brief discussion of the challenges of accurately defining and quantifying regulation and red tape add context to understanding the BC model, and more broadly, some of the challenges associated with effective exercises in cutting red tape.

While I’m a huge fan of reducing the regulatory burden in theory, I can’t help but expect to be disappointed about the implementation in reality… (however, should the federal bureaucracy somehow manage to perform nearly as well as the BC experiment, it’ll be Justin Trudeau getting the credit for it, rather than Stephen Harper — but better that the country benefits as a whole rather than the former PM gets boasting rights.)

November 17, 2015

QotD: The meaning of the word “professional”

Filed under: Business, Quotations — Tags: , , — Nicholas @ 01:00

We fell into a debate on the meaning of the word “professional,” which was promptly decided by rank. “Professional” turned out to mean an operation that proceeds smoothly; that is impersonal; that is free of temporal distractions and unnecessary costs; and in which everyone does what he’s told without thinking. (This last is called “teamwork.”) It is product-oriented, and the important thing is that the product should preserve market share, while remaining profitable. Let the philosophers decide whether it were any good. The product should rather be, in itself, smooth and mechanically predictable: anything warmly human in the packaging to be carefully faked by the experts in a professional advertising agency. Costs and benefits should be enumerable, and transparent to management at every stage. “Quality,” by contrast, “is purely subjective” — a question of fashion, for those specialists in hype.

“This is a business, not an art form,” I was told. (To be fair, this boss would himself have preferred to be an artist; but the art form would have been acting, and so he played his rôle.)

Now, ethics do come into this. A company that is flourishing will have clear “policies.” A lot of money could be lost if the company were caught cheating, on taxes or whatever; and secrets, as we know, can only be kept between two people if one of them is dead. Therefore, various “options” that might further streamline a profitable operation must be rejected on sight, as adding unconscionably to risk. But ethics cannot extend to any background worldview, that is agnostic on the fundamental human virtues, and thus essentially exploitative and sleazy.

As I have long observed, ethics are for people who have no morals.

I think “professionalism” came in, to the marketplace, about when craft standards were going out. It was discovered that a mass market had come into being, as a consequence of the technological innovations of some Industrial Revolution. Products were no longer made for specific buyers, but for demographic groups to purchase “off the shelf.” Souls could now be counted in the Gogolian manner, as “consumers” in terms of heads, eye-balls, little feet, &c. Broad-franchise representative democracy was a parallel development, and finally, the principles of marketing could be applied across the board. Far from consideration as an immortal soul, the individual could now be denominated as a capricious cypher: a one or else a zero at the “cashpoint.”

David Warren, “On managing”, Essays in Idleness, 2014-11-22.

November 16, 2015

“Skunk Works” founder Kelly Johnson’s Rules Of Management

Filed under: Business, Military, Technology, USA — Tags: , , — Nicholas @ 02:00

Tyler Rogoway recounts the set of formal and informal rules Kelly Johnson used while running the famous “Skunk Works”:

Clarence “Kelly” Johnson is the Babe Ruth of aerospace design. Aircraft programs under Johnson were so cutting edge and historically influential, and his cult of personality and management strategy so effective, that he and Lockheed’s Skunk Works (which he also founded) are forever enshrined in mankind’s technological hall of fame.


Kelly’s Rules

1. The Skunk Works manager must be delegated near complete control of his program in all aspects. He should report to a division president or higher.

2. Strong but small project offices must be provided both by the military and industry.

3. The number of people having any connection with the project must be restricted in an almost vicious manner. Use a small number of good people (10% to 25% compared to the so-called normal systems).

4. A very simple drawing and drawing release system with great flexibility for making changes must be provided.

5. There must be a minimum number of reports required, but important work must be recorded thoroughly.

6. There must be a monthly cost review covering not only what has been spent and committed but also projected costs to the conclusion of the program.

7. The contractor must be delegated and must assume more than normal responsibility to get good vendor bids for subcontract on the project. Commercial bid procedures are often better than military ones.

8. The inspection system as currently used by the Skunk Works, which has been approved by both the Air Force and Navy, meets the intent of existing military requirements and should be used on new projects. Push more basic inspection responsibility back to subcontractors and vendors. Don’t duplicate so much inspection.

9. The contractor must be delegated the authority to test his final product in flight. He can and must test it in the initial stages. If he doesn’t, he rapidly loses his competency to design other vehicles.

10. The specifications applying to the hardware, including rationale for each point, must be agreed upon well in advance of contracting.

11. Funding a program must be timely so that the contractor doesn’t have to keep running to the bank to support government projects.

12. There must be mutual trust between the military project organization and the contractor, and there must be very close cooperation and liaison on a day-to-day basis. This cuts down misunderstanding and correspondence to an absolute minimum.

13. Access by outsiders to the project and its personnel must be strictly controlled by appropriate security measures.

14. Because only a few people will be used in engineering and most other areas, ways must be provided to reward good performance by pay not based on the number of personnel supervised.

Kelly also had a unofficial 15th, 16th, and 17th rules, which he is known to have stated repeatedly to his subordinates:

15. Never do business with the Navy!

16. No reports longer than 20 pages or meetings with more than 15 people.

17. If it looks ugly, it will fly the same.

It is amazing to think that one man did so much to advance mankind’s aerospace capability. Even his few dead-ends and failures had key technologies that would lead to wins or lessons learned down the road.

H/T to @NavyLookout for the link.

November 15, 2015

The more likely explanation for the fall in eBook sales

Filed under: Books, Business — Tags: , , , — Nicholas @ 03:00

Sarah Hoyt explains why you should be darned careful not to base your business plans on wishful thinking:

Of course ebooks from traditional publishers are a) unreasonably priced (No, really. There is a book I’m dying to get. It’s $17 for ebook. It’s $32 for the hardcover. You know, I have KULL subscription and the indie books aren’t as good as this particular book should be, but it takes a lot of not as good at 9.99 a month to compare to those prices.) b) often stupidly formatted/edited c) even more often on themes/by authors I have no interest in. (Other than Baen, I currently read two other authors. Period. Oh, and one in mystery.)

Or to put it another way, traditional publishers went to war with Amazon to be allowed to price their books astronomically high. Amazon let them. They priced books at same price as hardcover or a little under (a very little.) E-book sales fell, compared to what they were when books were tops 9.99. Um….

Let me see if I can explain this as I would a child: your little friends love and adore your cupcakes. So you decide to set up shop and make a batch in your easy-bake oven, and sell them for ten cents a piece. Since your friends’ on average have an allowance of a dollar a week, you sell out of the whole batch in hours. So you think “Hey, I can make more.” You set the price at a dollar per cupcake. No one buys them. Your conclusion is “My friends no longer like cupcakes and prefer to eat vegetable sticks.”

Would anyone but a two year old buy that narrative? Well, according to publishers this is a perfectly sane thing to say. I mean, if people won’t buy your overpriced ebooks, it must mean they are going back to paper. Happy days are here again. Let’s build warehouses for all those books we’ll be shipping out to the no-longer existent big-chain bookstores! We’ll be able to control what books make it by our push again! We’re rich, rich, I tell you.

But it’s not just publishers. A friend sent me this article, and I scratched my head and frowned at it and said, in my deep thinking way, “Wut?” This is sort of like if you told your mom your friends’ refusal to buy your $1 a piece cupcakes was because they liked celery more and she said “Sounds legit. For your birthday party we’ll have ONLY celery.”

QotD: Shopping in Germany

Filed under: Business, Europe, Humour, Quotations — Tags: , , — Nicholas @ 01:00

The shopkeeper in Germany does not fawn upon his customers. I accompanied an English lady once on a shopping excursion in Munich. She had been accustomed to shopping in London and New York, and she grumbled at everything the man showed her. It was not that she was really dissatisfied; this was her method. She explained that she could get most things cheaper and better elsewhere; not that she really thought she could, merely she held it good for the shopkeeper to say this. She told him that his stock lacked taste — she did not mean to be offensive; as I have explained, it was her method; — that there was no variety about it; that it was not up to date; that it was commonplace; that it looked as if it would not wear. He did not argue with her; he did not contradict her. He put the things back into their respective boxes, replaced the boxes on their respective shelves, walked into the little parlour behind the shop, and closed the door.

“Isn’t he ever coming back?” asked the lady, after a couple of minutes had elapsed.

Her tone did not imply a question, so much as an exclamation of mere impatience.

“I doubt it,” I replied.

“Why not?” she asked, much astonished.

“I expect,” I answered, “you have bored him. In all probability he is at this moment behind that door smoking a pipe and reading the paper.”

“What an extraordinary shopkeeper!” said my friend, as she gathered her parcels together and indignantly walked out.

“It is their way,” I explained. “There are the goods; if you want them, you can have them. If you do not want them, they would almost rather that you did not come and talk about them.”

Jerome K. Jerome, Three Men on the Bummel, 1914.

November 12, 2015

Entry, Exit, and Supply Curves: Decreasing Costs

Filed under: Business, Economics — Tags: , , — Nicholas @ 05:00

Published on 18 Mar 2015

In this video, we talk about the special case of the decreasing cost industry. As output increases, costs will continue to fall, and more firms will enter which, again, increases output. It’s a virtuous circle! At the end of this video, we review the major points made in this section. If you find that something doesn’t quite make sense, feel free to re-watch videos as many times as you’d like.

November 10, 2015

The “War on Christmas” opens another front … at Starbucks

Filed under: Business, Media, Politics, Religion, USA — Tags: , , — Nicholas @ 04:00

Katherine Timpf can’t believe that anyone is taking this nonsense in any way seriously:

Please stop embarrassing yourselves.

I woke up this morning to find that real, adult people are actually upset that Starbucks’s holiday cups do not mention Christ or Christmas on them — and the absence of such language as an attack on their religion.

Yep, that’s right. The “War on Christmas” season has arrived, and Starbucks has chosen the side of the godless hedonism that is destroying our society. Don’t let the fact that it still sells a Christmas Blend, a “Merry Christmas” gift card, and an Advent calendar fool you — Starbucks is clearly The Devil’s Coffee, and you have every right to be this upset.

That is, of course, if you are an insane person.

November 5, 2015

The high-church organic movement is feeling under threat

Filed under: Business, Environment, Health, Media, Politics, USA — Tags: , , , , — Nicholas @ 02:00

Henry I. Miller & Julie Kelly on the less-than-certain future of the organic farming community:

The organic-products industry, which has been on a tear for the past decade, is running scared. Challenged by progress in modern genetic engineering and state-of-the-art pesticides — which are denied to organic farmers — the organic movement is ratcheting up its rhetoric and bolstering its anti-innovation agenda while trying to expand a consumer base that shows signs of hitting the wall.

Genetic-engineering-labeling referendums funded by the organic industry failed last year in Colorado and Oregon, following similar defeats in California and Washington. Even worse for the industry, a recent Supreme Court decision appears to proscribe on First Amendment grounds the kind of labeling they want. A June 2015 Supreme Court decision has cleared a judicial path to challenge the constitutionality of special labeling — “compelled commercial speech” — to identify foods that contain genetically engineered (sometimes called “genetically modified”) ingredients. The essence of the decision is the expansion of the range of regulations subject to “strict scrutiny,” the most rigorous standard of review for constitutionality, to include special labeling laws.


Organic agriculture has become a kind of Dr. Frankenstein’s monster, a far cry from what was intended: “Let me be clear about one thing, the organic label is a marketing tool,” said then secretary of agriculture Dan Glickman when organic certification was being considered. “It is not a statement about food safety. Nor is ‘organic’ a value judgment about nutrition or quality.” That quote from Secretary Glickman should have to be displayed prominently in every establishment that sells organic products.

The backstory here is that in spite of its “good vibes,” organic farming is an affront to the environment — hugely wasteful of arable land and water because of its low yields. Plant pathologist Dr. Steve Savage recently analyzed the data from USDA’s 2014 Organic Survey, which reports various measures of productivity from most of the certified-organic farms in the nation, and compared them to those at conventional farms, crop by crop, state by state. His findings are extraordinary. Of the 68 crops surveyed, there was a “yield gap” — poorer performance of organic farms — in 59. And many of those gaps, or shortfalls, were impressive: strawberries, 61 percent less than conventional; fresh tomatoes, 61 percent less; tangerines, 58 percent less; carrots, 49 percent less; cotton, 45 percent less; rice, 39 percent less; peanuts, 37 percent less.

November 3, 2015

Brian Micklethwait explains why libertarians love Uber

Filed under: Business, Economics, Liberty — Tags: , , , — Nicholas @ 02:00

At Samizdata, Brian Micklethwait discusses why Uber comes up in conversation with libertarians … constantly:

I and my libertarian friends all love Uber. By that I don’t just mean that we love using Uber, the service, although I am sure that just like many others, we do. I mean that we love talking about Uber, as a libertarian issue, as an issue that nicely illustrates what libertarianism is all about and the sorts of things that libertarians believe in. In particular, we believe in: technological innovation and the freedom to do it, for the benefit of all, except those in the immediate vicinity of it and overtaken by it, because they make a living from the technology that is being overtaken.


To me, the really interesting thing about Uber as an issue is how it makes a nonsense of the old Public Choice dilemma in pro-free market lobbying and opinion-mongering. I’m talking about the fact, which it does often tend to be, that when there is a lurch, proposed or actual, towards a free market, unleashed either by politics or by technology or by a mixture of the two, the people who suffer or who look like they will soon suffer are highly concentrated and easily organised and know exactly who they are. However, those who will benefit from the new dispensation are dispersed and hard to organise and tend not to know who they are. Consequently you get this imbalance in the political argument, in favour of the status quo, even if, in the longer run, many more people would benefit from the new dispensation than the old, and would like it very much, in the event that that ever discovered that they were benefiting from it.

Uber might have been invented to solve the above problem.

Thought: maybe there is a sense in which it was invented to solve this problem. Discuss.

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