Bryan Caplan  

Bastiat Lives At Cafe Hayek

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Why Does Homelessness Persist ... WIN and the PBC...

Don and Russ continue their Herculean effort to make economics too clear not to understand. The latest gems:

Don on protectionist anecdotes:

But I wonder how many of these people would accept the following line of argument:

Researcher Jones, like most other researchers in the field, reports that a majority of Americans are fluent only in English. But I dispute this claim, for my wife -- who is American -- is fluent also in French. Therefore, I reject the finding that most Americans are mono-lingual.
I suspect that few, if any, of my correspondents would find the above rejection of the claim that most Americans are mono-lingual to be compelling. Yet these same people proudly make similar arguments about the consequences of trade -- and, because they e-mail these arguments to me, obviously believe that these arguments have weight and merit.

Russ on the minimum wage:

I find it strange that those who favor an increase in the minimum wage often are the same people who complain about outsourcing, or the moving of factories to low-wage countries or the greed of corporations such as Wal-Mart eager to squeeze every last penny out of their employees by paying only what the market will bear. Surely, such greedy and enterprising organizations will find a way to avoid the impact of the minimum wage by hiring fewer workers and finding other ways to reduce the cost of workers who are suddenly more expensive yet no more productive.

Bastiat's no longer with us, but it's nice to see my colleagues carry on his Sisyphean struggle against economic illiteracy.


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COMMENTS (1 to date)
aaron writes:

Also, they ignore how people will spend. I'm likely to restrain my spending facing higher prices. I will reduce my purchasing and defer my spending. Unfortuately, I still will not have the income for higher quality consumable goods and entertainment, which are limited by supply, so I'm most likely to simply save my money until I can go on a vacation abroad.

For entertainment, I really like music. But CDs are already way overpriced (cost of medium and distribution have gone down substantially, yet prices have remained the same for over a decade). Increasing the pay of the music industries target market (teenagers) will not encourage them to decrease prices any faster. I am weary of spending over $10 on CDs. If prices don't drop, I will continue not to buy them. Raising the minimum wage would keep me from buying the music I enjoy, because the music industry will likely not try to target me knowing that teenages aren't likely to spend their money on anything but music.

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