Market Anticonservatism

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Jason Kuznicki

Jason Kuznicki is a research fellow at the Cato Institute and contributor of Cato Unbound. He's on twitter as JasonKuznicki. His interests include political theory and history.

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  1. Avatar Mike Schilling says:

    Would commuting be fun if you didn’t have to drive? I think so. You could sleep, eat, read, watch a movie, play games, even have a drink if you wanted.

    I take a ferryboat to work and, in fact, have all of those choices.

    No person shall operate a motor vehicle upon the streets of the city without giving full time and attention to the operation of the vehicle.

    I don’t see how that outlaws driverless cars. Either the mechanism that operates the car isn’t a person and the law doesn’t apply, or it is a person that pays more-than-human attention to its job. Or are you assuming that the law, being an ass, would conflate operating a standard car with being a passenger in an automatic one?Report

    • Avatar Jason Kuznicki in reply to Mike Schilling says:

      If my car were rolling down the street while I played chess and drank a martini, I don’t imagine it would be a defense to say “Well, I wasn’t operating the motor vehicle.”

      Would you?Report

      • Avatar Mike Schilling in reply to Jason Kuznicki says:

        In your current car, no. In a car that drives itself with no input from you, and you not in a seat from which any manual controls are reachable, sure.Report

      • Avatar RTod in reply to Jason Kuznicki says:

        This strikes me as an argument that sounds good in a late-night bull-session type argument over beers, but is completely unrelated to actual reality.

        Do you really envision that – when driverless cars finally become a mainstay – everyone using them will be round up and arrested, even though no one thinks they should or that’s what the law mean/intends, because you someone make a clever argument about the current laws? Really?

        I know that folks on this sight tend to lean toward philosophically based argument, but a little real world pragmatism wouldn’t hurt.Report

        • Avatar Jason Kuznicki in reply to RTod says:

          Do you really envision that – when driverless cars finally become a mainstay – everyone using them will be round up and arrested, even though no one thinks they should or that’s what the law mean/intends, because you someone make a clever argument about the current laws? Really?

          No, I don’t imagine it. There’s no need whatsoever to imagine. It’s real.

          I know for a fact that this is how the law is interpreted, and laws like the above are the exact reason Google can’t introduce driverless cars into testing. They have one, they’ve tested it on closed courses with great results, but they can’t test it on the road.

          This isn’t a hypothetical. It isn’t philosophical or speculative. It’s happening right now.

          There won’t be mass arrests, because all it takes to stop innovation is a persuasive threat. That’s what’s holding the industry back right now, anyway.Report

          • Avatar RTod in reply to Jason Kuznicki says:

            Then let me try another tact. Why not now simply change the laws?

            I think you were correct that the current laws made sense and worked for the best for the vast amount of time driving has been an issue, and as you show we now we may be coming to a time when they don’t.

            Why is the lesson to be gleaned from the above that such laws are a detriment and should be avoided, and not that such laws should be mutable (as they are)?Report

            • Avatar Jason Kuznicki in reply to RTod says:

              Why not now simply change the laws?

              That’s what I’m asking for.

              Still, this law obviously has a whole lot going for it, which is more than can be said for many anti-innovation laws. And if we do introduce driverless cars, they will have to be regulated for safety lest they pose unacceptable risks to bystanders. I don’t know how to do this properly, but it seems like small-scale testing might be a good idea.Report

    • It seems pretty clear that driverless cars are illegal. But I don’t see any reason to believe that they have to remain so. I’m sure motor cars broke all kinds of laws about what was required for horse carriages, no?

      Truthfully, the bigger roadblock I see with driverless cars involves discomfort involving electronics and cars. As with the whole Toyota thing. The first major accident would scare people off for years whether it involved driverless error or not. Not to mention juries, comprised of same people.Report

      • Avatar Plinko in reply to Will Truman says:

        Well, there’s the obvious status quo bias built into most/all law-making systems that would, at minimum add years of delay to the procees and might itself stifle the innovation as long as the rule remains in place.
        It’s nice to say we could just waive away such a law, but there will be inevitable lobbying of anyone who stands to lose something and the politicians who will look for ways to turn opposition into an opportunity for self-aggrandizing. It’s never as easy to ‘fix’ bad/obsolete laws as we want them to be.

        That said, it might be a lot easier to make a legal interpretation via administrative rule-making to adjust for driverless cars.Report

        • Avatar Will Truman in reply to Plinko says:

          The main lobbyists against autotaxis would be regular taxi drivers. Compare that with the full might of the auto-makers, as well as the consumer, and I don’t think they stand a chance. There’s huge money to be made here.Report

          • Avatar Plinko in reply to Will Truman says:

            I think you’re failing to imagine a bit, there are insurance companies, for one, that would surely be very concerned about the potential for losing a massive part of their business. There are manufacturers of traffic signals and signs and traffic schools. Some police departments depend heavily on citation income to operate. Any auto manufacturer that chooses to invest less or maybe invests poorly in the technology would try to block the arrival of auto-driving cars by hook or by crook.
            None of them would do it by going to the newspapers saying ‘we oppose changing this law’, they’d just donate heavily to the inevitable concern groups that would vociferously oppose such cars, fund studies overemphasizing the risk-potential, etc.Report

            • Avatar RTod in reply to Plinko says:

              Why would insurance companies lose businessI like the larger point, but for the record insurance companies won’t lose business. There will still be automobiles, and they will still need to be insured. There will still be losses; if there are less losses then premiums will go down, but the insurance companies will have more a more regular underwriting profit.

              In fact, I’ll make a prediction that the advent of driverless cars will be embraced by the insurance industry, and the need to be dialed in technologically will greatly reduce the amount of illegally uninsured motorists.Report

            • Avatar Will Truman in reply to Plinko says:

              I’m with RTod on questioning why the insurance companies would lose business. Cars would still need to be insured.

              The bigger the auto company (and thus the more money to throw around in lobbying), the more they will be able to invest, the more they stand to gain. Suzuki, Mitsubishi, and Chrysler wouldn’t be able to stop Toyota, Honda, and so on. And it’s the latter group that would be pushing for it.

              Ultimately, I think that this would be too big a thing to kill. Even if we don’t do it here, some other country will do it. They will establish a safety record, and people over here will want what the people in Japan and China have.Report

              • Avatar Plinko in reply to Will Truman says:

                Maybe I just don’t understand the insurance industry well enough, but I would guess that the human variability involved in proper actuarial assessment of driver risk requires an investment in said capabilities that provide barriers to entry and thus economic rent to incumbent player who do quite well on auto insurance. Greatly reducing risk would negate the value of that investment, opening up the door to much more competitive pressures on profits and probably a large shrinkage of the total market value of auto insurance. Think of it this way, would a technological advance that greatly reduces crime increase or reduce overall spending on law enforcement (ex the costs of the magic anti-crime technology)?

                The point isn’t that it means we will NEVER have driverless cars. It’s that the status quo bias will deter/slow investment in the technology itself, which will slow the product to market. Take Jason’s example of the Google car, if they can’t test it and have no guarantee of being able to put them on the road anytime soon, it’s going to act as a serious drag on investment in the necessary research. Very few can make big investments with no clear time horizons on when they can take their product to market.
                Yet, without a fully tested and heavily promoted product, who is going to lobby to change the law? Without the law changed, who is going to test and promote the product? Sure, someday someone else might invent it somewhere else, but surely it will be most likely much later than it would otherwise.Report

              • Avatar Will Truman in reply to Plinko says:

                If the insurance companies are against safer roads, they do a pretty good job of hiding. They’re big boosters of 55mph speed limits, for example. Their industry group (IIHS) tried to ban dangerous motorcycles. Things like that.

                The safer the roads are, the easier the actuarial analyses and the less volatility in pay-outs. The greater the predictability, the greater the stability. This, I believe, more than offsets the losses of the required capital and barriers-to-entry (which itself is subject to economies-of-scale).

                To move away from the roads for a minute, the medical malpractice insurance companies in my home state fought hard for MedMal Tort Reform, even though they knew if it passed it would likely mean more competition and lower premiums (both of which happened). Not having to worry about sporadic multi-million dollar settlements made it worth it to them regardless, and made it worth it for out-of-state firms to enter even if they couldn’t charge as high of premiums.Report

              • Avatar Will Truman in reply to Plinko says:

                Oh, and I agree that adoption will be slow. But I do think the path to it is clear and already underway with adaptive cruise control and automatic parking. It’ll be a bit-by-bit thing as the computers take over a greater and greater share of the driving chores. Then, eventually, people will get tired of having to keep their eyes on the road at all times when they aren’t having to actually do anything. And that’s when the real fun begins.Report

          • Avatar DensityDuck in reply to Will Truman says:

            “The main lobbyists against autotaxis would be regular taxi drivers.”

            This is certainly true. The taxi lobby is the reason why LA’s mass transit system doesn’t go to LAX, and why Las Vegas’s mass transit system doesn’t go to the airport.Report

            • Avatar Francis in reply to DensityDuck says:

              Not the taxi lobby; the airport authority itself strongly resisted the public transportation hub for fear of losing parking lot revenues. (and there’s more than bureaucratic empire-building in that decision; the authority didn’t want to risk defaulting on bond debt paid by those revenue streams)Report

          • Avatar Barry in reply to Will Truman says:

            IMHO in many areas the taxi company *owners* would happily lobby for driverless taxis.Report

  2. I actually think this is the best of your Hayek posts (and any Hayek posts that have appeared on this site for that matter).

    “The uncomfortable truth about knowledge is that we all have less of it than we like to admit.” – humanity has a habit of deifying individual inventors and scientists without realizing that almost everything of value that has been produced was a group effort.

    “How do you paint a beautiful painting? What makes a good bedside manner? How do you run a great university-level calculus class? Some people know these things. We’d want them in any flourishing modern society. And none are susceptible to algorithm.” – This article (http://humbug.baseballtoaster.com/archives/000500.html), which I’ve linked here before, argues otherwise.Report

    • > I actually think this is the best of your Hayek posts

      Seconded.

      I have a longer comment, but it’s percolating at this stage.Report

      • Avatar Rufus F. in reply to Pat Cahalan says:

        Thirded. Although I don’t remember much about previous Hayek posts, I really like this one.Report

        • Avatar tom van dyke in reply to Rufus F. says:

          Hayek’s “market libertinism” is as anti-left as it is anti-conservative in the American context, of course. This is the reliable stuff of Reason Magazine, which has an aesthetic appeal to many folks of both teams, but not when the rubber hits the road. [Drugs, prostitution.]

          In 2011, the pornography wars are largely over; trans fats, tobacco, circumcision and coercion on buying health insurance are more on the front burner.

          In the essay, Hayek allows that “conservatives” [as he uses it] can be allies of liberty, albeit for wrong reasons—not much there for an alliance between libertarianism and leftism [which he calls socialism in his paradigm].

          I’m cherry-picking Hayek below, as I’m no expert. But it seems to me that leaning on “Why I Am Not a Conservative” can be a cherry-picking as well, a cudgel against “conservatives” in our contemporary American context, and not particularly how Hayek uses it. This seems to me as more representative of his thought and canon:

          “And the idea that things ought to be designed in a ‘just’ manner means, in effect, that we must abandon the market and turn to a planned economy in which somebody decides how much each ought to have, and that means, of course, that we can only have it at the price of the complete abolition of personal liberty.”

          “That things ought to be designed in a ‘just’ manner” strikes me as a fair account of many or most of the commentariat’s [if not the mainpage’s] sentiments hereabouts and of the left in general. Hayek is no friend to such a sentiment.Report

          • Someone should write a book about the history of trans fat. It was basically created in a lab in the 1970s as a food additive which resisted microbial decay. Turns out the body doesn’t break it down so well either (duh) and it just lodges itself in the arteries to remain in perpetuity. So trans fat is more or less a slow-acting poison. [I’m remembering this from a lecture I listened to from the Yale Rudd Center, so I may be entirely mistaken. I do recommend their podcasts for anyone interested in food.]

            Advertising “no trans fat!” as a meme is fairly ridiculous, kind of like advertising “no hemlock!” or “no radioactivity!” (couldn’t do that for bananas), yet we eat it up (pun intended).Report

  3. Avatar Chris says:

    Consider the following law:

    No person shall operate a motor vehicle upon the streets of the city without giving full time and attention to the operation of the vehicle.

    Reasonable? Yes! Makes a level playing field? Yes, because getting killed by reckless drivers is no way to run a society.

    But note that it also makes driverless cars illegal — even if, as seems likely in the near future, driverless cars become safer and more fuel-efficient than the ones run by humans.

    Who knew computers were persons!

    I think you’re suffering here from the same sort of either/or thinking that plagues Bob. It’s perfectly possible to have a market that’s not a free for all, culturally or otherwise, and that still functions effectively. In fact, there’s no a priori reason to think that it won’t function better. The reason, of course, is that the market isn’t the only kind of distributed knowledge base (science, e.g., is another one, and one that sometimes does and sometimes doesn’t work like markets), and these other distributed knowledge bases can be used to create and refine market interventions (or, some of us might argue, market alternatives).

    Also, all of the things you list in the post are susceptible to algorithm. They are, in fact, the products of algorithms. Sorry to quibble, but since I’ve spent most of my adult life studying such algorithms, I couldn’t resist. Also, Hayek knew this even at a young age.Report

    • Avatar Jason Kuznicki in reply to Chris says:

      Who knew computers were persons!

      This is a ridiculous objection. The person who activates a computer driving program is operating the car, just not with full attention.

      I don’t see what’s so hard to grasp about this.

      Additionally, if you are reading The Sensory Order as an argument against inarticulate knowledge, you aren’t understanding it properly. It’s an argument in favor of inarticulate knowledge.Report

      • Avatar Chris in reply to Jason Kuznicki says:

        Jason, since operation of the vehicle, when it is automated, is turning the autodriver on, your point still fails.

        What’s more, I read The Sensory Order as an argument for the way in which knowledge is represented in the brain (namely as a neural-network like series of assocations). By the time he published it, algorithms representing that sort of information had already been described (Hebb published The Organization of Behavior in 1949, and Hayek was aware of it). There is a difference, and a nontrivial one, between being able to articulate knowledge in a way that, for example, allows us to transmit it to other people in a way that lets them use it in their own actions (e.g., teaching how to paint new masterpieces), and being able to articulate them algorithmically. I can look right now at an algorithm describing color vision in such an accurate and complete way that I can model it nearly perfectly in machine vision (putting aside issues of qualia), but I can’t, no matter how hard I try, teach you to see red. This isn’t a problem with the information itself, or its ability to be articulated, but with the way we learn. This, I take it, was part of the point of The Sensory Order (or at least a subtext).

        The reason this is non-trivial is that there are ways of describing, and perhaps even explaining, things that otherwise look like they can’t be articulated, but such ways require distributed expertise and careful study. They’re not the sort of thing that a committee does very well with, but they are the sort of thing that can actually help us to do things better without going through markets. We don’t even need complete knowledge. Corporations use what we’ve learned just in the last 10-15 years about the processes underlying creativity and innovation, for example, to teach their employees how to innovate more effectively. They don’t teach them how to come up with an idea for the next Twitter or iPad-type idea, because too much of that is contextual and, let’s face it, arbitrary, so the algorithms underlying it are too specific to be useful, but they do teach them how to come up with ideas that are as novel as Twitter or the iPad, if not more so. And that’s precisely the sort of thing that saying that don’t admit algorithm precludes. And it’s also the sort of knowledge that comes from outside of markets (or at least, it comes from a heavily regulated market: the market of scientific ideas).Report

        • Avatar Jason Kuznicki in reply to Chris says:

          Jason, since operation of the vehicle, when it is automated, is turning the autodriver on, your point still fails.

          You and the others will have to take this argument up with the courts. Driverless cars are currently understood to be illegal in all 50 states based on laws very much like this one.

          As to inarticulate knowledge, I think we are working from different premises. You write:

          There is a difference, and a nontrivial one, between being able to articulate knowledge in a way that, for example, allows us to transmit it to other people in a way that lets them use it in their own actions (e.g., teaching how to paint new masterpieces), and being able to articulate them algorithmically. I can look right now at an algorithm describing color vision in such an accurate and complete way that I can model it nearly perfectly in machine vision (putting aside issues of qualia), but I can’t, no matter how hard I try, teach you to see red.

          I don’t believe that anyone necessarily could teach me to paint new masterpieces. They could probably help me to get better at painting, but the ability to produce a truly great work of art is not something as easily taught. Studying a chess book will maybe help me play better, but even studying Kasparov isn’t necessarily going to make me a world champion.

          What I’m really trying to get at is the distinction between “knowing how” and “knowing that” — the former is art; the latter is science. Much knowledge, while certainly teachable to some extent, is not teachable in the exhaustive way that I’m rejecting. Knowledge-that is a thing that can be taught in repeatable fashion, reliably, from one person to the next. Knowledge-how can be taught, but it’s difficult to repeat precisely, and even ascertaining that someone has knowledge-how is sometimes difficult. (Andy Warhol: Great painter? Or pretentious fraud? How about Salvador Dali? We could go on…)

          In that sense, pointing out that we can teach people to be better problem-solvers or better creative thinkers doesn’t defeat my point at all. I’m not saying that these things fall like mana from heaven, and that we have to take whatever share of them that providence gives us. I’m only saying that we can’t reduce all of them to rote or to mechanism.Report

          • Avatar Chris in reply to Jason Kuznicki says:

            I don’t believe that anyone necessarily could teach me to paint new masterpieces. They could probably help me to get better at painting, but the ability to produce a truly great work of art is not something as easily taught. Studying a chess book will maybe help me play better, but even studying Kasparov isn’t necessarily going to make me a world champion.

            This is because there are always two components to a work of art (in the broad sense: I include painting and a mass-produced chair in this): know-how and ability + context. Teaching know-how from knowing-that will always run up against the limits of talent and context. It is possible to teach someone to paint a Cezanne: forgery is taught. It is impossible to teach someone directly to paint something on the level of a Cezanne because that is the combination of teaching know-how, socialization, and innate (though cultivated) talent. It’s all algorithmic, in that it’s all the product of algorithms, but it is impossible to teach (even if, theoretically, it might be possible to describe). So I guess on this we agree, even if we use a different language in describing our positions.

            But I use the language I do because it points out the limits of the thesis that the market is the most efficient use of knowledge when it is left alone. That may be true, but it is an empirical hypothesis, rather than a deduction from self-evidently true axioms, and it is an empirical hypothesis that has not been confirmed, because the markets that function more or less well in our society today and in our history are informed, regulated, and otherwise limited by outside sources, some of which may, if properly used, make properly limited markets function even better than markets left to their own devices entirely.

            Put a different way, some knowledge is better gained outside of markets proper, though still in distributed networks (centralization is right out). And putting that knowledge into markets isn’t (always) simply a function of letting the markets appropriate them as markets appropriate things. Somtimes, you have to add them in artificially (through regulation, e.g., or through supplementation, as in the case of healthcare).Report

  4. Avatar Jaybird says:

    Just sunset the laws! If a law can’t pass again five years after it passed the first time, it ought to go away.

    Or ten, if you’re one of those conservative types.Report

  5. Avatar greginak says:

    Let’s say there is a law against releasing a known toxic gas into the air. Sure that seems to make sense but what if a company that can release that toxic gas into the air will make a wonderful breakthrough with the money the saved by not having to safely dispose of the gas or what about the medical breakthrough that might come from treating the consumers of the toxic gas.Report

  6. Avatar Rufus F. says:

    Here’s the thing I don’t get about markets and it’s not an objection or anything, just something that I can’t understand: why is it that most places I’ve lived went from having about a dozen good places to get a really burger to having two McDonald’s and a Wendy’s in about two decades time? It seems like it should be just the opposite.Report

    • Avatar Jaybird in reply to Rufus F. says:

      When did we, as a country, become a place where ordering a burger meant that you had to ask them to hold the mayo rather than be one where you had to request it special?

      God help you if you go to one of those places and forget to say “no mayo” because they just slather it on there like we’re Norway or something.Report

    • Avatar DensityDuck in reply to Rufus F. says:

      “[W]hy is it that most places I’ve lived went from having about a dozen good places to get a really burge[sic] to having two McDonald’s and a Wendy’s in about two decades time?”

      Because the “really good burger” wasn’t all that good to begin with, and it took ten minutes to get one, whereas you could get an acceptably-good burger at McDonald’s or Wendy’s in about forty-five seconds. Once there was actual competition, the burger places needed to do more than Have Burgers; they needed to present a meal that was sufficiently more desirable than McDonald’s or Wendy’s that consumers were willing to spend so much more. (time, like money, has value; spending time is a cost, just like spending money.)Report

      • This is why I can’t have nice things, because the rest of humanity would rather have acceptably-good in 45 seconds.

        Which says something to be about market forces. It says the market seeks the acceptably good; people generally prefer fast and cheap over good… which makes total sense: we can all quibble over what’s “good”, but we all have a pretty good idea of what’s cheap and what’s fast.

        This is why I’m not entirely enamored of the market.Report

        • Well, unless you live in the sticks*, you typically still have slow-diners. Fewer, but they’re still there. And fast food places are increasingly offering “premium” menus where the burgers actually taste more like burgers and less like what they usually serve. I get the sense that the premium menus are areas of solid profit (moreso than 99c menus, which gets people in the doors and induces them to get fries and a drink where they have better margins).

          * – And if you do live in the sticks, having fast food places is nice because they actually stay open past 9 or 10:00!Report

        • Avatar DensityDuck in reply to Pat Cahalan says:

          “This is why I can’t have nice things, because the rest of humanity would rather have acceptably-good in 45 seconds.”

          Yes, because–as I pointed out–the “better” was not so much better as to be worth a 13000% increase in delivery time.

          See, that’s the thing. Providers need to understand their market. If the market wants burgers faster, then it doesn’t matter how good your burgers are. The market will prefer the faster provider, excepting ad absurdum cases where the faster provider is in fact serving dog food.(*)

          Maybe, then, what needed to happen was for the diner operators to recognize that the market for “fast” and the market for “good” were no longer forced by an artifically-limited market to purchase burgers form the same provider. They could increase the price of their “good” burgers to the point where they had a sustainable business providing them. Of course, they’d also have to improve their standards, both in quality of food and in quality of presentation; and, really, that’s where a lot of these local mom-and-pop shops fell down. Because they weren’t, in the end, better than McDonald’s or Wendy’s; they were playing the same bottom-feeder game as the big providers, only not as well.

          (*) This is not an invitation to reply to this post with a smartass comment about “WELL THATS WHAT MICDONALDS GIVES YOU LAAAWWLLZZZZZ”Report

          • It’s worth noting here that it cuts both ways. It used to be that fast food places kept burgers under a heat lamp for which there was *no* wait unless you wanted something particular. I knew some people that would request no-ketchup just because it meant that they would have to make it then-and-there. Some people still do that with salt and fries.

            Anyhow, there was a real sea-change a while back and everybody wanted made-on-order, even if it meant waiting a couple of minutes. And all of the fast food places rushed to change their kitchens accordingly. So what we see now with fast food is actually a compromise.

            (Out of curiosity, how were restaurants “artificially limited” before fast food?)Report

          • > Yes, because–as I pointed out–the “better” was
            > not so much better as to be worth a 13000%
            > increase in delivery time.

            Yeah, see, here’s the disconnect. Subjectivity.

            The “better” is generally worth an increased delivery time, *to me*. 45 seconds versus ten minutes for a Big Mac vs meat-ground-today burger isn’t a tradeoff I generally like to make.

            Because I don’t prioritize time that way. Granted, other people do, that’s great and all for them. And generally speaking, them getting their 45 second burger is probably a more general market niche than people who don’t prioritize their time that way; I don’t blame McDonald’s for making McDonald’s hamburgers.

            I’m just saying, the market delivers the acceptably good – your words. The acceptably good is more often a function of fast and cheap, and less of quality. This works great if you want things fast and cheap. It doesn’t work as well if you want things of quality.

            There are of course exceptions. I can find a really good knife out on the market now. Probably better quality than knives I could have found 20 years ago. Because there’s enough of a market for good quality knives among the *huge* market for cheap and good enough knives that you can make a living selling knives to the people who want good knives.

            Same thing holds true for tools and a lot of other things. Cheapass tools are available everywhere. Good tools are available via the internet, if nothing else.

            But goddamn, I can’t get a good burger over the internet.Report

            • In-and-Out Burger, California. Fresh-ground meat, cooked to order, lines around the block.

              Me, I don’t care much, a burger’s a burger.Report

            • Avatar DensityDuck in reply to Pat Cahalan says:

              “Yeah, see, here’s the disconnect. Subjectivity.”

              So you’re willing to pay more for a burger. There’s nothing wrong with that, but it’s not a market failure that you were not enough to sustain a market by yourself.Report

              • > So you’re willing to pay more for a burger.
                > There’s nothing wrong with that, but it’s
                > not a market failure that you were not
                > enough to sustain a market by yourself.

                Well, duh. By definition, the market answers the call of the customer base. By definition (to market-thinkers) the market cannot fail, it’s doing what it is supposed to do.

                The problem is not only that it’s not giving me what I want, it’s that it *cannot*. To do so would be to actually fail. To support the expectations of a significant minority of the population is to burn yourself down, as a provider.

                The framework of the market has limitations; just like any other framework. That’s all.

                I happen to not like this particular limitation very much. It depends too much upon the subjectivity of the userbase. While this isn’t a “market failure”, it’s a “failure of the market”; an inability of the framework to cover an edge case.Report

              • Well, there’s mass-market, then there’s the custom-made market. You can buy a Stratocaster or a suit off the rack, or you can have one handmade.

                If you want a $25 quarter-pounder, your wish is my command.

                http://www.1-800-kobebeef.com/kobeha.html

                an inability of the framework to cover an edge case.

                I would think that “the market” is the only way to accommodate the “edge case.” I don’t see the problem here. If you want to build a Taj Mahal, all you need do is pay for it.

                If you want a 5-necked guitar, you got it.

                http://www.guitargallows.com/bios/biophotos/Rick_Nielsen.jpg

                Hell, I see they had one on eBay awhile back. Just be patient. All good things come to he who waits…Report

              • Avatar Jason Kuznicki in reply to tom van dyke says:

                I’ve got to say I’m with Tom on this one.

                There’s a lot of air between “The market never provides for my preferences” and “The cheapest/closest/fastest choice in the market is not the one I judge the best.”Report

              • Just to make sure I’m not misunderstood, because I think Jason and Tom might be operating under an assumption:

                I’m not saying that I need someone to fix this particular problem for me. The lack of X in a particular region Y is not something to which I am entitled to have a solution granted unto me (particularly in the case where “X” is “a burger” and Y is “anywhere I happen to be looking for a good burger joint”). See, Tom, I’m not a liberal after all 🙂

                And, as it turns out, there’s a couple of good burger joints here in Pasadena, which is a town with a wide selection of culinary options.

                When I drive to Montana, though, there’s many a stop wherein it’s Jack in the Box or Sonic (where everything tastes like a corn dog), or Arby’s if you’re in Utah.

                The point which I am making is that the market, as a mechanism, has its own rules, and those rules result in conditions that are not always desirable.

                Pat sez:

                > an inability of the framework to cover
                > an edge case.

                Tom sez:

                > I would think that “the market” is the
                > only way to accommodate the
                > “edge case.”

                No, there’s lots of ways to accommodate the edge case. And in fact, we do accommodate certain edge cases for very good reasons (for example, we subsidize vaccinations in numerous ways because pandemics suck, and drug companies can make more money producing supplements and homeopathic remedies than they can producing flu vaccine).

                In addition, there are edge cases which we accommodate by private mechanisms (and that we ought not by government means), such as access to art, which is largely subsidized by foundations and people with giant piles of money.

                There are edge cases that we *create* with our intellectual property laws, and that’s a whole struggle worth several blog posts.

                Finally, there are edge cases which we don’t accommodate by any mechanisms. Which, almost always, works out okay.

                But nevertheless, *the market*, as a mechanism for distributing goods efficiently (in the absence of government intervention of course) relies entirely upon the collective opinion of capital holders (demand) to set the price of goods.

                This means that you are held to the whims, desires, etc. of your fellow townsfolk. And in a very real way the greater statesfolk, nationsfolk, and (for most goods) international peoples’.

                Now, if market supporters cannot see *how* that can occasionally present problems, well, okay, I guess we’re done here.

                I’m not asking you guys to give up supporting your main favorite mechanism. I’m not even advocating changing it, at the moment. I’m just trying to get ya’ll to admit that occasionally the approach has a couple of minor drawbacks.Report

              • When I drive to Montana, though, there’s many a stop wherein it’s Jack in the Box or Sonic (where everything tastes like a corn dog), or Arby’s if you’re in Utah.

                Utah is notoriously chain-linked, but even there you have a spectrum running a fast food dollar burger to the likes of Applebee’s. And a surprising selection of international foods if you know where to look, though on the burger front they are often lacking.

                Notably, in Utah and Idaho, having the family diner chains is actually a marker of affluence. I can’t tell you how excited a town I lived in for a while was when they got an Olive Garden. The possibility that they might get an OG made the front page of the paper.

                Montana itself is big on burgers. At least the parts I’ve been. But with all of these states, a lot of it depends on where you’re looking. I know people say of my home city “there’s nothing there but chains” when, in fact, there’s a lot there but all they’re seeing is chains.Report

              • I think the larger point was lost among the burger talk.

                Rich Wine’s Burgerville in Polson MT makes a good burger. There’s a really badass joint up the road in Dayton MT that makes a bison burger that I’d (reluctantly) kill for.

                Dammit, now I want a burger.Report

              • Avatar RTod in reply to Pat Cahalan says:

                “There’s a really badass joint up the road in Dayton MT that makes a bison burger that I’d (reluctantly) kill for.”

                Proving, for once and for all, that liberals aren’t the pussies conservatives make them out to be when it comes to violence. You just have to find the right trigger.Report

              • I have capacity for great violence. I don’t like that about myself, but there you go. Blame it on the Irish.

                It’s buried under layers of civilization, but a burger could bring it right out, provided it’s the right burger.Report

              • The problem is not only that it’s not giving me what I want, it’s that it *cannot*. To do so would be to actually fail. To support the expectations of a significant minority of the population is to burn yourself down, as a provider.

                This is only true, I would think, when markets are so limited that only the prevailing choice exists. Quality burger joints exist, at least in most places. That they are not as prevalent as McD’s means you are inconvenienced, but not that you are excluded.

                Of course, sometimes we are excluded. I’m still pissed about Windows Mobile.Report

              • > Of course, sometimes we are excluded.
                > I’m still pissed about Windows Mobile.

                Oh, don’t get me started on technology. I could write reams of crap about how technology, as presented, largely sucks due to the market.

                We still use clock-based chips. Asynchronous chips are more energy efficient, and you can generally make them faster on a bang-for-the-buck return. But there’s a network effect involved; so much software already exists that the hardware difference, although better, can’t undo the advantage of the built-up network effect.

                Hell, we see that now with fishing gasoline. We have a nationwide distribution network that manages to bring in tens of thousands of gallons of fuel into this city and deliver it to filling stations on every damn corner every day. It’s remarkable how much effort is put forth to make it so that I don’t have to drive more than 400 yards to get a tank of gas unless I go north of New York avenue, and then I’m in Altadena technically anyway.

                Any alternative fuel has to beat out the convenience factor of gasoline. It’s not just fighting on actual capability, it’s fighting on perception and convenience. This is not a trivial problem to overcome.

                Barriers to entry aren’t always imposed by government regulations.Report

              • Avatar North in reply to Pat Cahalan says:

                Hate to say it Pat but Tom has the right of it in my view. Even if the joints in your immediate locale don’t themselves offer a fine burger there are plenty of stores offering decent ground beef and a good collection of stores offering grills.Report

              • Avatar tom van dyke in reply to North says:

                Could be Pat’s soft liberal heart speaking. He has In-N-Out Burger in SoCal and the rest of the world doesn’t. Life isn’t fair.

                Only the market is. 😉

                http://sidedish.dmagazine.com/2011/05/11/in-n-out-burger-opening-madness-in-dallas-a-report-from-the-field/Report

              • Avatar North in reply to tom van dyke says:

                I’m a liberal myself in case you weren’t aware Tom.Report

              • > Could be Pat’s soft liberal heart
                > speaking.

                Not exactly, m’friend. Again, not asking anybody to fix it for me 🙂

                > Life isn’t fair. Only the market is. 😉

                Only if you’re defining fair by “what everyone else wants”. Which is, admittedly, a fair definition of fair, Tom.

                Not exactly a Ideal, but it’s a workable definition.

                Note, though, that this definition of fair can turn in your hand…Report

              • Note:

                I’m laying a trap, here… for you, Mr. van Dyke.

                The spikes at the bottom of the pit aren’t that sharp. But if you’re going to agree to this definition of fair, I’m going to link to this thread at some point in the future.

                Just sayin’ 🙂Report

    • Avatar RTod in reply to Rufus F. says:

      I suspect this has more to do with the people you live around than what “markets” do or don’t. Twenty years ago in Portland, cuisine was utterly horrible – a sea of independently owned Italian joints that were no better than the Olive Garden, and a bunch of pub grills and chains. But the advent of just a few “high quality” foodie establishments created a market for more, which mushroomed. Now there is a “backlash” movement against quality food among some. Salem, our state capitol some 30 miles South, can’t keep a quality restaurant open for more than a few months – people who live there don’t like the food or the price or the portions.

      A better example that markets do work might be TV: when I was growing up there were really only 3 channels that made original programming. And though some of the classics from that era are still held up today as what TV should aspire to (MASH, Hill Street Blues come to mind) most of what we had was insufferable crap. (Want to see how bad? Find reruns of 3’s Company – a classic! – on cable some time.)

      I certainly would have guessed that having hundreds of channels to choose from would have resulted in crap programming. And crap does exist (see: reality TV), but there was nothing on the air 20 years ago that comes close to comparing to great TV today. Even shows that I think of as second or third quality tier, like the Battle Star Galacta reboot or Rome or Rubicon, kick the hell out of the best TV had to offer from my growing up years.

      (see also: how Napster and iTunes meant we didn’t have to listen to nothing but a dozen REO Speedwagon knockoffs record execs thought would have the best chance of selling platinum.)Report

      • Avatar Ru fus F. in reply to RTod says:

        Well, it definitely has to do with the income level of the people you live around. When that’s higher, there’s a plethora of different eateries for all tastes. Where I live now, it’s pretty much McDos or nothing. Even our burgers, beers, and sports place closed down and they were pretty cheap comparatively.Report

        • Avatar Will Truman in reply to Ru fus F. says:

          Wow. I live in a pretty small town but nothing like that. It probably helps that we’re in cow country and the people up here like their beef (although hate seasoning and spicing, bring your own Tony Chachere).Report

          • Avatar Ru fus F. in reply to Will Truman says:

            Admittedly we’re one of the poorest cities in Canada. Most place a bit up the economic scale have a Harvey’s, which is considerably higher on the burger scale and fairly cheap. The closest one to me is about 20 miutes away and I’m absolutely okay with making the drive.Report

            • Avatar Will Truman in reply to Ru fus F. says:

              Well, if you ever want a burger and don’t have time to make the drive, give McD’s premium menu a try (if you haven’t already). It’s not gourmet, but it’s a class apart from their usual. I pained, pained, pained me to spend $4 on a burger from McD’s, but it doesn’t taste nearly so much like a McD’s burger.Report

        • Avatar RTod in reply to Ru fus F. says:

          Oddly, in Portland the more upscale the residential area of town is, the more Applebees and Olive Gardens you will find. All the “foodie-approved” joints are in the mid- and lower-income areas.Report

    • Avatar Simon K in reply to Rufus F. says:

      As someone else said: “In ‘n’ Out Burger”. Apparently we left coasters have taste. My particularly tiny city also has a Burger King, a Carls Jr, and and Jack in the Box. I assume these places all have their markets, but they ain’t me. Possibly when the nipper becomes interested in burgers, I’ll find out what they are. Also, there are at least 4 “gourmet” burger joints within a five minute drive of my house. That’s a 300% increase on last year and I suspect a bubble forming. Soon you won’t be able to go out to eat without getting a burger. And the genuinely-quite-gourmet gastropub place 10 minutes away has genuinely-extremely-awesome burgers made from grass fed beef. And this is just out in the ‘burbs. I’ve not looked for a burger in the City recently, generally having better things to do with my time when I’m there, but just off the top of my head there’s a place where you can get a $5000 burger (although that may be related to the fact it comes with a “free” bottle of Chateau Petrus) to places that serve nothing but garden burgers. And McDonalds, of course.Report

  7. Avatar DensityDuck says:

    “Summed consumer preferences are like that as well. When it’s difficult enough to figure out what you want, it’s obviously impossible to know in advance what a society will want, at least if we are to go beyond a bare subsistence attained by well-known methods. ”

    If you’re looking for a non-money way of thinking about this, try the internet-humor angle: “You can’t make something a meme”.

    People did not set out from the start to make “nyan cat” or “double rainbow” or “the cake is a lie” or even “all your base” into pop-culture phenomena. Similarly, despite Valve’s best efforts, people aren’t going around yelling “COMBUSTIBLE LEMONS!” every time something goes wrong.Report

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