28 Aug 09
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Originally posted by MelanerpesThe flaw in my argument? (Edit: I see now that you wrote "flaw in this argument" not "his argument". My apologies) I've never said that we have to make a discrete choice between having only mom and pop joints and having only large-chain producers. We can certainly have some mix of both and people who can and want to pay a premium to buy mom and pop can an should do so. The flaw in the argument that you presented though is that it assumes everybody values "local flavor" sufficiently to prefer it even at a premium. But this is not so. Some people actually prefer chains to local eateries for instance. I want to very clear about this because I don't want my position to be distorted into "free trade is always better for everyone everytime an in every way.". My purpose has always been to dispute Rob's claim that we'd all be better off we just bought local.
Telerion focuses on one of the main benefits of free trade -- it allows nations (and smaller regions within them) to specialize in producing the things they are most efficient at -- the result is greater output and lower prices. The result is that you have "more stuff per capita".
BUT - the downside is that when a company is serving a huge global market, andards" -- but anyone who really loves pizza would see the flaws in this argument.
28 Aug 09
Originally posted by rwingettMy apologies if I have misunderstood your stance but when I asked about how important political boundaries were you seemed to get upset. Certainly you have mentioned buying American a number of times which makes me think that political boundaries are important to you. You did not say anything about buying from Canada or Mexico in preference to China.
I don't know what you're talking about. My list of priorities clearly placed "buying local" at the number one spot. Union made and American made were secondary and tertiary considerations.
The support of local industry, local farming and local commerce are my top considerations.
So, protectionism. And I have no real problem with that. But do you believe that it is good for the world as a whole or just for your community?
I cannot control what happens in third world countries. Buying products made in China may have a small impact on Chinese wages, but it has a dramatic influence on reducing wages everywhere else in the world.
And how does that happen? I am not saying you are wrong, I just want to understand it. Further, I don't see how buying American rather than Chinese is going to benefit wages in Zambia.
It fuels a race toward the bottom in wages where the standard will be set by the nation willing to accept the lowest wage.
Surely that will then provide the most equalizing wage system. You are instead proposing that the country that pays the highest wages gets the work and the country with the lowest wages must suffer in poverty.
Prices may come down, but your purchasing power will come down even more. Lower prices with lower wages is a net loss.
Keep the rich rich. I get it now. Just don't try to pretend that you are helping the Chinese - or the Zambians.
28 Aug 09
Originally posted by rwingettSays who? Noam Chomsky? Noam Chomsky, though a brilliant scholar in linguistics and a very good writer, does not constrain his opinions to match available data. On the other hand, economists who speacialize in international trade spend their lives trying to under what conditions trade is beneficial, who gains and who loses from trade, what happens to factor prices in different countries as result of opening to trade (that would include real wages), what happens to the mix of goods that are produced in countries as a result, and a whole manner of other fascinating topics. They do this with a varying mix of theory and empirical measurement. Generally, they constrain themselves in some way to actual data.
I don't know what you're talking about. My list of priorities clearly placed "buying local" at the number one spot. Union made and American made were secondary and tertiary considerations. Reduced fuel consumption is one big consideration when buying local, but for me it's not the top consideration. The support of local industry, local farming and local com ...[text shortened]... ur purchasing power will come down even more. Lower prices with lower wages is a net loss.
28 Aug 09
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Originally posted by telerionYou are free to make any inquiries you want. And I am free to ignore them as I see fit.
This is a reply for the thread in general since unfortunately the person to whom this question would be best directed is adamantly opposed to free inquiry.
According to rwingett if everyone just purchased from their area everyone would be better off (see his reply to what would happen if non-Michiganers didn't purchase MI cars.). He's also claimed that p him out and tell me where the optimal scale of an economy is and why it is so?
Your attempts to mischaracterize my position are tiresome. What I have been consistently saying is that if everyone bought "more" from their local area, everyone would be better off. You keep trying to imply that I advocate buying "exclusively" from a local area, which is simply not true. I have twice given the statistic that if every Michigan family spent a mere $10 more on local products per week, it would keep $37 million per week within the local economy. That hardly amounts to your great bogeyman of protectionism. I also have no interest in the "Buy American" campaign when it comes to auto purchases. Due to the complex nature of automobile manufacturing, I do not think it is practical. I will hasten to point out that my wife drives a Honda Civic (I have a Chrysler Sebring).
Like a typical "economist" you also keep trying to force me into rigidly quantifying my approach. What scale of an economy is optimal? How should I know? I have no intention of providing a detailed or comprehensive plan of action or all-inclusive statement of principles. My approach is intended to be a broad and flexible one scaled to the individual's ability or interest in pursuing it. As such, there is no answer I can give you. It is up to each individual's interpretation.
28 Aug 09
Originally posted by telerionOf course they won't refuse US dollars. That is not the intent. The vast majority of their incoming revenues would still be generated that way. Once again, it's not an all-or-nothing approach. It's merely intended as an influence to keep money circulating locally. It requires consumers who are likewise interested in participating, and who are willing to exchange their dollars for local ones.
This local currency stuff sounds like a way to make people who have strong preferences local goods more identifiable and to give them a little positive reputation benefit. I mean it isn't like local stores are going to refuse US dollars, right?
28 Aug 09
Originally posted by telerionDon't flatter yourself. Chomsky says you're a bum and I am inclined to agree.
Says who? Noam Chomsky? Noam Chomsky, though a brilliant scholar in linguistics and a very good writer, does not constrain his opinions to match available data. On the other hand, economists who speacialize in international trade spend their lives trying to under what conditions trade is beneficial, who gains and who loses from trade, what happens to fac ...[text shortened]... ory and empirical measurement. Generally, they constrain themselves in some way to actual data.
28 Aug 09
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Originally posted by twhiteheadWhen it comes to foreign purchases, I advocate "fair trade" over "free trade." If I could purchase fair trade products from China or Zambia, I would gladly do so.
My apologies if I have misunderstood your stance but when I asked about how important political boundaries were you seemed to get upset. Certainly you have mentioned buying American a number of times which makes me think that political boundaries are important to you. You did not say anything about buying from Canada or Mexico in preference to China.
[ h. I get it now. Just don't try to pretend that you are helping the Chinese - or the Zambians.
Individual purchases among solitary consumers is not the same as "free" trade agreements between nations. Individual purchases may or may not help the workforce of foreign nations, but "free" trade agreements almost never do. It is your "free" trade agreements which are making the rich richer and driving wages down for everyone else, Zambians included.
28 Aug 09
Originally posted by rwingettYou've read too much into your figure. Sure if every family in Michigan spent more in Michigan more money would stay in Michigan. That does not imply that buy local is the way to increase wealth in every community. What you need to find out is how much money would Michigan lose if all non-Michiganers reduced their purchases of michagan products by $10 per week. Then you actually have something to compare your first figure to. Right now all you're talking about is taking $10 that would gone to a different community (or communities) and giving it to your own. That in and of itself is a zero-sum game, and does not support statement that we'd all be better off if everyone bought more local.
You are free to make any inquiries you want. And I am free to ignore them as I see fit.
Your attempts to mischaracterize my position are tiresome. What I have been consistently saying is that if everyone bought "more" from their local area, everyone would be better off. You keep trying to imply that I advocate buying "exclusively" from a local area, whi ...[text shortened]... such, there is no answer I can give you. It is up to each individual's interpretation.
28 Aug 09
Originally posted by rwingettExactly. The idea is to give purchasing local a little more appeal by bundling the purchase with little bit of positive reputation. The people who already would buy local are happy to extra value for their purchase. The people who can't afford to buy at premium won't care because they can't afford those goods anyway. The only benefit that a town might get from this is snagging a few marginal types that either were very close to buying local before or really value reputation. My initial intuition is that these benefits are very small.
Of course they won't refuse US dollars. That is not the intent. The vast majority of their incoming revenues would still be generated that way. Once again, it's not an all-or-nothing approach. It's merely intended as an influence to keep money circulating locally. It requires consumers who are likewise interested in participating, and who are willing to exchange their dollars for local ones.
28 Aug 09
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Originally posted by telerionYou have to start small. Most people don't even know local currencies exist. If they became aware of them and the rationale behind them, then I think many more people would be favorably disposed.
Exactly. The idea is to give purchasing local a little more appeal by bundling the purchase with little bit of positive reputation. The people who already would buy local are happy to extra value for their purchase. The people who can't afford to buy at premium won't care because they can't afford those goods anyway. The only benefit that a town might g ...[text shortened]... fore or really value reputation. My initial intuition is that these benefits are very small.
Mark my words, Telerion, we are standing on the cusp of a burgeoning "buy local" revolution. It is already starting to take hold of public consciousness. Throughout the 20th century the trend was toward bigger and bigger corporations with broader and broader distribution. The result was an increasing homogenization and standardization of products. This led to the death of the local store, which in all too many cases translated into the death of the local community itself. That trend is beginning to reverse itself. People are beginning to realize that the Walmart phenomenon was a Faustian bargain and the price they paid was much too high. There is a palpable clamoring for small. local producers again. Businesses that are an integral part of the communities in which they are located, and who share the same concerns as the local populace themselves. Not like the CEOs at Walmart, who, as everybody knows, are only concerned with their bottom line.
28 Aug 09
The "buy local" movement should fit in with free market principles if it reflects voluntary consumer decisions. If people are spontaneously choosing to support local businesses, it must reflect that these businesses offer something that the Wal-marts cannot. It may be products and services that reflect the unique patterns, traditions, and tastes of the local community. It may be the level of service that comes only when the consumer and producer are personally acquainted with each other.
As such, people may be willing to accept "lower living standards" as measured by how much "stuff per capita" each person has, because this is more than offset by things that the official numbers don't measure very well. But if economists could quantify everything that the local producers provide, they would likely find that these "buy local" movements actually increase economic efficiency.
28 Aug 09
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Originally posted by MelanerpesMy position exactly, and economists are quite aware that real GDP per capita does not pick up all the value to consumers (Nevertheless premium purchases will still raise GDP/capita relative to generic ones because when real GDP is calculated they use some sort of approximate aggregate deflator which is not sensitive enough to pick the difference in price between say local pizza and domino's pizza).
The "buy local" movement should fit in with free market principles if it reflects voluntary consumer decisions. If people are spontaneously choosing to support local businesses, it must reflect that these businesses offer something that the Wal-marts cannot. It may be products and services that reflect the unique patterns, traditions, and tastes of the lo uld likely find that these "buy local" movements actually increase economic efficiency.
Again, I'm all for people buying things that they like. If buying local makes you happier than buying walmart then more power to you. I take issue with some of the statements that have been made concerning the worldwide effects of everyone practicing a buy local rule of consumption.