David R. Henderson  

Economists Signing Petitions

Opera and Education... When Did House Prices Get Out ...

Dan Klein and David Hedengren have a piece at Cato on economists signing petitions. One of their basic findings is how little overlap there is between the group of economists who sign anti-freedom petitions and the group who sign pro-freedom petitions. One of their other findings is that Vernon Smith, Mark Perry and I were the most-frequent signers of pro-freedom petitions.

You might think that I'm a "signing slut," but I'm actually not. I have said no to a fair number. I refuse to sign either when I disagree with some important statement in it, even if I favor the bottom line, or when I agree but I think it's misleading. An example of the latter is one a few years ago against a tax on California oil producers. I opposed the tax. But a major part of the argument was that it would cause California gas consumers to pay more. Well, yes. Along with gasoline consumers in France. The point is that the oil market is a world market and so a reduction in supply due to a tax doesn't have a bigger impact on consumers who live near the producer than it does on consumers in general. And when you consider how much is produced in California relative to world production and how relatively small the tax increase was, I would have been surprised if the price of gasoline were to rise by more than about a penny a gallon. What I thought was terrible was that it would take wealth from California oil producers.

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COMMENTS (5 to date)
Hyena writes:

Whether the reduction in their wealth is a major concern hinges greatly on where the oil is produced from. If it mostly derives from Federal lands or open water, the tax largely represents a transfer from the Interior Department to California.

David R. Henderson writes:

Good point. I don't know enough to say. One crucial issue, even with Federal land or open water, though, is the royalty formula. If it's a fixed amount or a percent of gross price, the feds lose almost nothing.

ryan y writes:

You mean, it's bad to take their wealth relative to not taking it, or bad relative to taking it in other ways or from other people?

I ask b/c one interesting thing about taxing nonrenewable resource extraction is that it's possible for such a tax to be completely non-distortionary (which, as Brennan and Buchanan pointed out, you can think of as a bug or a feature)

Hyena writes:

@Prof. Henderson,

Shouldn't the Feds lose in future lease bids regardless of the pricing scheme, or am I missing an impact of different schemes?

Hyena writes:

Also: what do you think of resource leases on Federal lands? How should they be priced?

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