On 17/05/07, Adrian Stott <[EMAIL PROTECTED]> wrote: > Adding to supply reduces the market-clearing price. But that is > addressing a different problem, i.e. wanting to pay less, as opposed > to wanting availability. > > Adrian
As you would expect, Adrian has provided a clear exposition of classic economic theory. And he is honest that the market clearing price would price out many potential boaters. There are two problems: 1) classic economic theory works when there are many potential buyers and sellers. I'm very happy for this price mechanism to settle the price of sausages. In this case there is not a mulitplicity of sellers, but one mass supplier BW and some local suppliers eg marinas, off-side moorings. BW can control the market price by rationing supply - it's a not a proper free market. 2) If we allow Adrian's philosophy to rule, boating will become a recreation even more limited to the well off. And that will make it harder to win tax support for BW (as we all want). If we don't ration by price, then some other mechanism is needed such as a waiting list. In the real world outside economics textbooks, there are usally messy compromises involved - and as Neil says - we have both price and waiting lists at the moment , with honeypot moorings costing more than less desirable ones, and with waiting lists for the popular ones. And because we live in the real world rather than a text-book it's why us non-economists can join the debate. I've been accused of being soft on BW in the past, but I think they are quite wrong on this. The big difference between Adrian and myself is that he thinks market solutions are appropriate (almost) everywhere. I think that markets are powerful tools, but don't always work - and that we need a public realm where markets can be useful servants, but shouldn't ever be master, as markets give more votes to the well off in decisions where evryone has a right to an equal say. -- Nigel Stanley
