Aug 22 2008
Consequences of a Free Market
The consumer gets screwed.
New Scientist reports that up to 1 in 4 fish sold in New York City is “mislabeled” as a more expensive variety. A little oversight goes a long ways.
(No Ratings Yet)
Loading ...Related Posts:
18 Responses to “Consequences of a Free Market”
To reduce spam, comments are automatically closed 30 days after the last comment. If you would like to comment on any closed thread, please use the contact form at the top of this page.
Great. What we need is federal pet store regulators to make sure that the fish floating upside down in people’s home aquarium are what they are advertised to be. If it matters enough to people what kind of fish they have, then they’ll educate themselves before buying. If it doesn’t matter enough to them, then it shouldn’t matter enough to society to regulate it. There are some consumer regulations that are necessary, this is about 16785th on the priority list.
So, Kazinski, you basically endorse cheating people who are buying something they are not first rate experts on. Great!
Kazinski,
No. You have a person buying something that has been advertised as product A at price $A. Yet they are actually buying product B that should be at price $B ($B< $A). Therefore, someone is making an additional profit of $A-$B due solely because the merchant misrepresented what they were selling. That is stealing. And in my opinion, they should be charged with (grand) theft.
Yeah, this sucks. I want to eat wild salmon, but there’s no way to tell if a restaurant is putting wild or farmed salmon on your plate. (Well, you can guess, because farmed salmon usually have a different texture, but salmon farms add carotenoids the the fish food to make the farmed fish have flesh coloured like the wild ones.) So, if I educate myself, and decide it’s worth it to me to spend a bit more because I don’t want to support the damage that salmon farms do, I can get harmed twice (once by the price and second by promoting more damage to the ecosystem by salmon farms). Frustrating!
Kazinski says, Who cares if it’s not worth it to the consumer to learn to distinguish. The article indicates that the restaurant/fish market could have been duped. Well, testing and regulation, with hefty fines for false advertisers, would be one way to make it worthwhile for the restaurant/fish market to ensure that they’re buying what they think they are. Otherwise, what’s their motivation?
You see a need for government oversight, I see a potential opening for a business. The free market isn’t perfect, but where there’s demand, there’s a gap that a free market will fill. It is completely anarchic, ensuring liberty, yet at the same time it is the most organized, stable system imaginable. The complexity of the NYC economic market is massive, yet somehow it is run by no single authority. When we superimpose authority onto a free market, the intelligence of people trading freely disappears and is replaced by imperfect human bureaucracies, where results don’t matter, and where the only motivation is to expand. Inefficency and incompetency of an authority don’t need to be introduced into a free market; the anarchic market is much wiser than any authority can be.
Carl, I’m no fan of big government, but regulation of private companies (with their proprietary rights) supplied by competing private companies (with their own proprietary rights) doesn’t fill me with confidence. Oversight wouldn’t be the primary objective of these private regulatory companies — making a profit would be, and a good way to make a profit is via backroom deals. Where I’m from, the effect of this can be seen when comparing environmental impact assessments that are done by companies hired by a developer to EIAs that are actually independent.
Backroom deals happen with government, too, but at least the public (even the poor, sometimes) has access to government — at least where I’m from. Maybe you can convince me otherwise with reference to fish example provided by Atmoz.
Gosh. No amount of evidence will convince the `individualistic’ conlibertarian fundamentalists that consumer protection regulation is a good thing.
It’s always the same excuse: “we” don’t really know what’s the best way to protect consumer, therefore “we” know the best way is to do nothing. We don’t know therefore we know…
Inefficency and incompetency of an authority don’t need to be introduced into a free market; the anarchic market is much wiser than any authority can be.
Shorter Carl:
That’s right!!!!!!
The same inefficients and incompetents can do sooooooooooooo much better with no oversight!!!!! Because magically they become efficient and competent when there’s a better chance that their actions go unobserved!!!! Isn’t human nature grrrrreat!!!! *Heart*!!!!!!!
Color me doubtful.
Best,
D
The attitude of you guys…
Dano, I think you’re sarcastically making fun of me, but your statement is so oblivious to the point of my comment, that I’m not sure.
Steve L, Competition has its ways of making things right. Are you guys actually suggesting that the FDA or some other government agency start up a program to monitor fish labelling? The world ain’t perfect. You go to Sam’s Fish Restaurant and get the wrong fish. You either don’t notice, or you’ve spent time with fish before, so you complain to the manager and stomp out. Or maybe, you’ll realize afterwards. You tell your friends don’t go to Sam’s; dey got badddd fish! Or you report Sam’s to law enforcement, who then follow up the accusation of false advertising. Boohoo. You deal with it in whatever way you want to; no need to clamor for more gov’t to take care of all of us. If you want to pay taxes to fund the infinite number of these types of pointless ventures, why don’t you buy fish insurance instead.
See, always the same thing.
We don’t know therefore we know… We don’t know therefore we know… We don’t know therefore we know…
Carl, law enforcement is a government institution (as are laws). I don’t want more government to take care of me and provide me with a perfect world. I want to be able to consume without causing extinctions. If possible I’d also like others not to cause extinctions. How can I do this? To me, some environmental regulation makes sense. Your ’solution’ of trying to sort through extremely difficult issues/details/specifics on my own and then trying to effect change by word of mouth (I’m ignoring the government institution suggestion for now) does not seem obviously better. Can you explain how this works more fully, or is it more a matter of faith for you?
I guess I’m just not a good free market fetishizer.
Especially when we know that the Clean Air Act has a 5-7:1 benefit-cost ratio. That’s right: for every dollar spent in following th’ regalayshun, 5-7 dollars are saved.
The market works for greed, not for provisioning public goods.
Best,
D
Steve
My point is you don’t need an excessive and expensive government program whenever you see a problem in society. There are other (and better) ways to deal with problems besides through government.
And yeah I can explain it to you. 5 people go to Joe’s fish house, and get the wrong fish but don’t notice. I go and I notice; I tell my friends and if I really care enough, I tell law enforcement. Or I don’t. Boo hoo. We have to learn to live with small problems; government can’t solve them all for us. Sometimes it can solve problems; ie the Clean Air Act. I never said all of government was bad. But this attitude that when you find a problem, the only solution is more oversight (instead of use of current law enforcement or individual action) leads to government excess.
I’ve written all that I need to to make my point, and since I’m not making headway, say hi to climate catastrophe for me cause I’m off.
Wait! One more point.
“The market works for greed, not for provisioning public goods.”
If there is public demand for goods, there will be a public supply of those goods at a price determined by supply and demand. Ok, now I’m gone.
If there is public demand for goods, there will be a public supply of those goods at a price determined by supply and demand.
Sadly, this misinformed script gets parroted all too often and is treated as received wisdom.
The Google doesn’t have a ‘wisdom’ button.
For those out there interested in learning why the italicized script excerpt fails to understand basic economics, this paper is a good start (Farley, J and Daly H 2001. The Failure of the Free-Market on a Full Planet. IN: Fifth International Conference of the International Society for Ecological Economics (ISEE) Moscow, Russia, September 26-29, 2001).
Best,
D
Carl, you assumed I had an attitude. And then when I asked for a better explanation of how to fix a problem without government, you gave me exactly the same explanation as the first time. I’m disappointed that you didn’t take the time to articulate how it works for the situation described (where DNA analysis was required to identify the raw fish — you can’t do a worthwhile DNA analysis on cooked fish). It’s not something you can magically ‘notice’. If the wrongdoing was obvious it wouldn’t be as problematic because it could be easily punished. Just like if it was obvious that there is some property being polluted by a neighbour, it would be easy to make them pay for it. But user-pay markets don’t work well when the property (e.g., atmosphere) is held in common — and to work that ’round, commons tend to be resources that are not easily parceled out and identified. Thus, unidentifiable fish and the atmosphere have some similar characteristics such that their problems don’t lend themselves to simplistic free market solutions. They need more complex solutions and I’m sorry you didn’t put in the effort to think one through.
“The market works for greed, not for provisioning public goods.”
So, we should get rid of the free market and bring in communism? I thought that didn’t work so well?
If the market works for greed what does government work for? Control?
October 29, 1929. QED.