Re: mutualism, was ... unemployment
Fred Foldvary wrote: > But mutualism is in fact practiced for the equivalent of hotel rooms. > > In time-sharing apartments, there are institutionalized ways in which the > owner of one apartment may swap with another owner in order to stay in a > place other than one's owned unit. Hence, no need to get that loan. It's rather inconvenient and I severely doubt it would exist but for the mortgage-deductibility of interest paid on time shares. It's particularly inconvenient if you want to visit a place better or worse than your own. It's the usual problem of barter markets. -- Prof. Bryan Caplan Department of Economics George Mason University http://www.bcaplan.com [EMAIL PROTECTED] "I was so convinced that soon, very soon, by some extraordinary circumstance I should suddenly become the wealthiest and most distinguished person in the world that I lived in constant tremulous expectation of some magic good fortune befalling me. I was always expecting that *it was about to begin* and I on the point of attaining all that man could desire, and I was forever hurrying from place to place, believing that 'it' must be 'beginning' just where I happened not to be." Leo Tolstoy, *Youth*
Re: how to eliminate unemployement
Kevin Carson wrote: > Like speculations on seizing land left fallow or whose > owner goes away on a 2-week vacation, this requires putting > the most inconvenient spin possible on mutualist rules. I have encountered people who claimed to believe that your hammer ceases to be your property from the moment when you put it down, so such speculations are not necessarily in bad faith. Well, suggest another spin. What's a dividing line between good hotel operators and evil absentee landlords? see also http://samizdata.blogspot.com/2002_02_10_samizdata_archive.html#9753522 (``In praise of renting and to hell with owning'') -- Anton Sherwood, http://www.ogre.nu/
Re: [Fwd: how to eliminate unemployement]
>From: Bryan Caplan <[EMAIL PROTECTED]> > >For some reason this didn't seem to post on Friday. > >Incidentally, while staying in a Lake Arrowhead hotel room this weekend, >I noticed the incompatibility of mutualism with renting hotel rooms. >The alternative would be to have people buy their hotel room, then >re-sell it when they leave. Same basic result as you have today, but >highly inconvenient if you need to get a $50,000 loan just to sleep >overnight somewhere. Like speculations on seizing land left fallow or whose owner goes away on a 2-week vacation, this requires putting the most inconvenient spin possible on mutualist rules. Actual mutualists might not be so accomodating to their discreditors. Lockean homesteading theory, if taken to a reductio ad absurdum, can likewise produce a lot of howlers. A mutualist system of property ownership, like a Lockean one, would require social consensus on the "rules of the game," and I doubt most communities would be averse to some kind of guest-hostel cooperative. Ironically, many anarcho-capitalists I've discussed these issues with are much less averse to mutualist occupancy tenure than to Geoist rent collection, viewing the former as having a plausible claim to being a genuine form of private property. Kevin Carson wrote: >>I meant slum occupants would simply become de facto owners, and stop >>paying >>rent--was that your understanding? >That's what it sounded like, but it was hard to believe anyone would say it. You did author the "Anarchist Theory FAQ," didn't you? So you must be aware that the proposal is not original with me. It was shared by Proudhon, Tucker, and many of the other thinkers you dealt with there. >>In the transition to a mutualist society >>and the expropriation of landlords, I'd be willing to negotiate some >>settlement in which landlords were paid up to the equivalent of what they >>could have saved from wage labor during their lifetime. Many wage earners >>are frugal and put their savings into small rental properties as a form of >>retirement investment, and I'd hate to see anyone robbed of the actual >>proceeds of his labor. But big slumlords and owners of vast tracts of >>land >>would be SOL. >So your proposal amounts to the following: >1. Partial expropriation of existing landlords. >2. A legal maximum rent of 0 forever afterwards. >After all, no one would ever build new rental property after your >proposal was implemented. The second part of the proposal just amounts >to a much more extreme version of New York rent control. People would >get around the policy by switching to owner occupancy, and anyone >lacking in current resources who doesn't qualify for a loan would be >homeless. Wonderful. One reason people have to rent under the current system is that land ownership has been preempted by absentee landlords and real estate speculators, and they have to pay tribute for access to it--instead of homesteading it. >Of course, if landlords had any warning, they would evict all of their >tenants and sell outright ownership - once against mimicing the long->run >response to rent control. A landlord occupying, say, a hundred family dwelling units, would have a hard time establishing his "occupancy and use" based ownership to the satisfaction of a mutualist community. Most likely, he'd be recognized as owner of whatever unit he occupied, and the rest would be homesteaded. >Frankly, this is one of the silliest ideas I've heard someone advocate >in a long time. Thanks, but I can't take all the credit for myself. As you surely know from editing the "Anarchist Theory FAQ," these ideas aren't original with me. They were shared by some of the people you treat as "right anarchist" precursors of anarcho-capitalism, in fact. _ Join the worlds largest e-mail service with MSN Hotmail. http://www.hotmail.com
mutualism, was ... unemployment
> Incidentally, while staying in a Lake Arrowhead hotel room this weekend, > I noticed the incompatibility of mutualism with renting hotel rooms. > The alternative would be to have people buy their hotel room, then > re-sell it when they leave. Same basic result as you have today, but > highly inconvenient if you need to get a $50,000 loan just to sleep > overnight somewhere. > Prof. Bryan Caplan But mutualism is in fact practiced for the equivalent of hotel rooms. In time-sharing apartments, there are institutionalized ways in which the owner of one apartment may swap with another owner in order to stay in a place other than one's owned unit. Hence, no need to get that loan. Fred Foldvary = [EMAIL PROTECTED]
[Fwd: how to eliminate unemployement]
For some reason this didn't seem to post on Friday. Incidentally, while staying in a Lake Arrowhead hotel room this weekend, I noticed the incompatibility of mutualism with renting hotel rooms. The alternative would be to have people buy their hotel room, then re-sell it when they leave. Same basic result as you have today, but highly inconvenient if you need to get a $50,000 loan just to sleep overnight somewhere. -- Prof. Bryan Caplan Department of Economics George Mason University http://www.bcaplan.com [EMAIL PROTECTED] "He wrote a letter, but did not post it because he felt that no one would have understood what he wanted to say, and besides it was not necessary that anyone but himself should understand it." Leo Tolstoy, *The Cossacks* --- Begin Message --- Kevin Carson wrote: > I meant slum occupants would simply become de facto owners, and stop paying > rent--was that your understanding? That's what it sounded like, but it was hard to believe anyone would say it. > In the transition to a mutualist society > and the expropriation of landlords, I'd be willing to negotiate some > settlement in which landlords were paid up to the equivalent of what they > could have saved from wage labor during their lifetime. Many wage earners > are frugal and put their savings into small rental properties as a form of > retirement investment, and I'd hate to see anyone robbed of the actual > proceeds of his labor. But big slumlords and owners of vast tracts of land > would be SOL. So your proposal amounts to the following: 1. Partial expropriation of existing landlords. 2. A legal maximum rent of 0 forever afterwards. After all, no one would ever build new rental property after your proposal was implemented. The second part of the proposal just amounts to a much more extreme version of New York rent control. People would get around the policy by switching to owner occupancy, and anyone lacking in current resources who doesn't qualify for a loan would be homeless. Wonderful. Of course, if landlords had any warning, they would evict all of their tenants and sell outright ownership - once against mimicing the long-run response to rent control. So even the first part of the proposal would not accomplish anything. You'd manage to kill the convenience of renting without doing anything for anyone. Frankly, this is one of the silliest ideas I've heard someone advocate in a long time. -- Prof. Bryan Caplan Department of Economics George Mason University http://www.bcaplan.com [EMAIL PROTECTED] "He wrote a letter, but did not post it because he felt that no one would have understood what he wanted to say, and besides it was not necessary that anyone but himself should understand it." Leo Tolstoy, *The Cossacks* --- End Message ---
Re: demand revelation and its discontents
On Thu, 29 Aug 2002, Fred Foldvary wrote: > The excess payments "must be wasted or given to nonvoters to keep all the > incentives correct." (p., 1154). In a footnote, T&T suggest that waste could > be avoided if "pairs of communities" "agree to exchange their collections of > these excess revenues." This is in accord with my proposition that demand > revelation does NOT imply the need to waste the resources. Your summary of Tideman/Tullock is bang on. I was only going on about the need for resource wasting because it seemed that you were arguing that the project being voted on would be funded through the taxes collected through the DRP. If this were the case, this would obviously induce incentive changes that would affect stated valuations. There have been a number of modifications to the DRP that have been proposed to avoid wasting the money collected. These losses seem second order, though, when compared to the losses likely to be generated by expressive voters using the DRP. Eric Crampton
Re: Median Voter vs. The Sub-optimal Equilibria
On Thu, 29 Aug 2002, Fred Foldvary wrote:
> > Specify that I get $5 worth of expressive benefits
> > from voting $5,000,000 for project A rather than project B. Specify also
> > that I will not be decisive, and that there are many people like me, each
> > of whom would not be decisive. Specify also that if B is actually chosen,
> > I accrue net benefits of, say, $100,000. If I am not decisive, I will not
> > bid $100,000 for B, because it's quite unlikely that I'll change the
> > outcome. Instead, I'll vote for the sure bet of expressive benefits
> > coming with a vote for A.
>
> The demand revealing process does not take a "vote", by which I presume you
> mean ("yes" or "no") or ("A" or "B").
> The process involves having each participant state the maximum amount he
> would be willing to pay for either A or B.
> So your example should indicate how much the individuals are stating.
In the example above, each voter states that he's willing to pay $5
million for option A. All voters do that, so no voter is the decisive
voter and no voter pays the tax. Each voter gets the sure-bet payoff of
$5 worth of expressive benefits rather than the $100,000 in benefits that
each could have gotten if B had been chosen.
> I don't regard that as authoritative. The revenues can be given to charity
> without disrupting the outcome.
Tideman/Tullock is fairly authoritative on this topic. There have been
extensions since their article that specify complicated mechanisms to
avoid wasting the taxes collected in the use of the demand revealing
process, but those losses are tiny compared with the inefficiencies in
outcomes that can be generated when expressive voters are let loose on the
demand revealing system.
> Hal Varian describes demand revelation in his textbook * Intermediate
> Microeconomics * (chapter on public goods). He states:
> "The tax is not paid to the other agents - it is paid to the state. It
> doesn't matter where the money goes, as long as it doesn't influence anybody
> else's decision; all that matters is that it be paid by the pivotal people so
> that they face the proper incentives."
Varian is right when he says that it doesn't matter where the money goes
so long as it doesn't influence anybody else's decision. The caveat is
important though, and the mechanisms that have been designed thus far to
avoid the waste are rather cumbersome.
> > "It may seem that a person who sustains a large loss when his preference
> > is not followed deserves compensation, but this cannot be given without
> > motivating an excessive statement of differential value. ... In regard to
> > the uncompensated losses that are produced, the demand-revealing process
> > is similar to majority rule."
>
> Right. And this does not require the destuction of resources.
That wasn't the point I was making. You were arguing that the DRP ensures
social efficiency and ensures that the winners compensate the losers. I
was pointing out that it does no such thing.
> > If I get $5 in benefits if I bid $5,000,000
> > for project A over project B, and if I won't be decisive, then I will bid
> > $5,000,000 for A.
>
> You are leaving out the cost. The demand revealing process posits a good
> with a cost C for N persons. The average cost is C/N. Each agent is
> assigned a specific cost, such as C/N, which he must pay if the outcome is to
> obtain the good. The participants are asked:
>
> How much is most you would be willing to pay for the good if the cost to you
> will be C/N if the decision is to obtain it?
> If indeed the decision is to do it or buy it, then all participants pay their
> assigned cost.
The cost seems rather irrelevant. Since no voter sees himself as
decisive, no voter takes the cost into account. All calculation is based
on the expressive benefits that can be generated from placing a vote/bid.
>
> > I'm bidding a number IN EXCESS of the benefits I
> > actually accrue. In the aggregate, many voters behaving this way impose
> > social costs.
>
> If you state a value of $5 million knowing you will pay $100, then your
> revealed preference is to pay that cost to obtain that good, and the benefit
> is revealed to be greater than the cost for the group as a whole if the sum
> of their stated value exceeds the cost.
I state a value of $5 million knowing that whether I have to pay the $100
average cost is not determined by my bid. I only get $5 in expressive
benefits, but since I'm going to have to pay the $100 regardless of what I
bid, I might as well state $5 million to get the $5 in expressive
benefits. Stated preferences in the DRP have zero connection to revealed
preferences.
> I'll look at T/T again, but the method does not make sense if there is no
> preassigned cost that the agent is comparing the benefit to.
The only way that DRP can be construed as calculating cost/benefit is if
all voters are instrumental. Then, we can simply compare the stated
values for A and B and see which is hig
Re: Median Voter vs. The Sub-optimal Equilibria
On Thu, 29 Aug 2002, Fred Foldvary wrote: > Yes, but an essential element is that each individual be assigned a specific > cost share, in dollars, so that he knows ahead of stating a value what it > will cost. That is Hal Varian's explanation in * Intermediate > Microeconomics * . But, since no voter is decisive in the DRP, the cost share is irrelevant. Let's state the problem somewhat more concretely. The ballot in front of the voter might as well state: "Dear Voter. You are helping to determine whether we undertake project X. However, it is vanishingly unlikely that your vote will change the outcome. In effect, whether we do X or don't do X really doesn't depend on your vote. But, we'd like you to tell us how much you'd value having X be done. If X is done, you'll have a $100 increase in your taxes. But, this does not depend on your vote at all. Really, it's the sum of everybody else's votes that will determine whether X is done. So, you might as well ignore the $100 when telling us how much X is worth to you. Now, if we do X, you'll get about $10 in actual benefits. If we don't do X, you save the $100. But, if you vote for X, you can tell yourself that you're a really public spirited kind of guy who loves puppies and apple pie (since X will benefit puppies and apple pie). In fact, if you write down on the ballot that X is worth $5 million to you, you'll feel really good about yourself and you'll value that wonderful feeling as much as if you found a five dollar bill on the sidewalk. Now remember: however much you write down, it's almost impossible that you'd ever actually have to pay any of it, and the average cost of $100 will be decided basically without your vote. So, do you want to go for the sure bet of $5 in "feeling good" benefits? Or, do you want the miniscule tiny chance of having the project not go through so that you don't have to spend the $100. Really, your chances of changing the outcome are so small that the expected value of voting against the project is just pennies. So, why don't you go for the sure thing? Write down $5 million for Project X and feel good about yourself!" Each voter writes down $5 million, the project is undertaken, and social loss of $85 per voter follows. > 4) The decisive (pivotal) agents pay the social cost (Clarke tax) equal to > the sum of the net values (all n(i)) other than that of the pivotal agent. When stated values reflect expressive preferences, the difference between net values has no connection to actual social cost. Eric
