> Civil society only exists when there is a collective general trust that most people are trying to do the right thing
The phrase "the right thing" is load-bearing, to steal a Claudeism. The Muslim Brotherhood that ran the country before El-Sisi thought they were doing "the right thing." El-Sisi also thought he was doing "the right thing." Egyptians mostly thought El-Sisi was doing “the right thing” during this time period. According to multiple independent opinion polls, his approval rating was high during this period because people were grateful to have stability.
In any society, you're going to have diverse views of "the right thing." To have a functioning civil society, you actually need the opposite of what you're saying. You need a collective general trust that people will follow the rules regardless of what they think is "the right thing."
Logic compels this conclusion. People who disagree on fundamental aspects of how the world and society should work cannot cooperate in a civil society if we trust that everyone will follow their vision of "the right thing." The only way we can cooperate is if we agree to neutral rules and procedures, and have a collective general trust that we'll all follow the rules regardless of our view of wrong or right. The thing I admire most about Anglo-American culture is that people will jump off a bridge if you give them a court order that complies with all required procedural formalities. That's how you create a civil society.
I think "the right thing" implied by "civil" in "civil society" means equal say in legal matters, immediate calling out of corruption and full transparency requirements, rule by pre-established and mutually agreed-upon laws, absolute adherence to pre-agreed human rights that require total consensus to alter, etc.
Therefore you can re-read the sentence as:
> Civil society only exists when there is a collective general trust that most people are trying to uphold those shared rules and principles, even when doing so is inconvenient or runs against their immediate self-interest.
> In any society, you're going to have diverse views of "the right thing." To have a functioning civil society, you actually need the opposite of what you're saying. You need a collective general trust that people will follow the rules regardless of what they think is "the right thing." […] The only way we can cooperate is if we agree to neutral rules and procedures, and have a collective general trust that we'll all follow the rules regardless of our view of wrong or right.
This requires that we accept that there is such a thing as a neutral procedure, and even if we accept that such a neutral procedure exists in principle, it doesn’t follow that we agree on what that procedure looks like. Deferring physical conflicts is only possible if factionalism doesn’t win out. The last decade and a half of western political history has been defined by the recognition of certain factions that this deferral can’t go on forever.
> This requires that we accept that there is such a thing as a neutral procedure...
Yes, it does. And we live in a society. So by extension we do already accept that neutral procedures are possible and that we have achieved them.
The English Common Law systems and their derivatives are an astonishing success in achieving general fairness. People arguing against it have, with remarkable consistency, failed to come up with anything that reaches it's level of neutrality. In fact, normally people struggled to come up with general criticism beyond accusations that specific individuals didn't follow the procedures properly or relatively minor tweaks to the administrative details.
Neutral procedures are a solved problem, the tricky part is convincing the law enforcement system to do things by the book.
The law in North America and Europe (possibly elsewhere too, I don't know) is full of accommodations for special interests at the cost of everyone else, due to concentrated benefits and diffuse costs causing the former to lobby aggressively while the latter doesn't.
To make a clear example: I don't think that it's fair that I'm not allowed to plumb my own (commercial¹) building just because I didn't learn how via a difficult to get, underpaid, full time, 4 year apprentiship in whatever state I'm living in at the moment, with usually ~0 practical escape hatch to demonstrate competence in any significantly different way, or to just have the result inspected.
1: some places, not all, have exemptions for owner occupied single family homes
> That depends entirely upon what you mean by "fairness," which will itself be loaded with presumptions about how the world is and ought to be.
If you’re an immigrant from my home country of Bangladesh, you’ll be treated more fairly in any Anglo country than in any other country, including Bangladesh.
I think the right thing in this context relates more to every day matters that affects people and how they interact with the world.
Corruption, unsafety, tax avoidance, vandalism, not paying the bus/tram ticket, littering.
As for el sisi. I remember an egyptian friend who fled the country after he did some protesting and journalism critical of the new regime. He said he was amazed by what good they had done for the country and was happy to see the change...despite his past opinion and current exile. Not that he would go back permanently. He married a german gal and later moved to the US.
> The thing I admire most about Anglo-American culture is that people will jump off a bridge if you give them a court order that complies with all required procedural formalities.
The president of the United States routinely violates court orders and has little respect for the law or the Constitution. Also, nobody is going to willingly jump off a bridge because a judge told them to. You'll find that the death penalty isn't carried out by asking people politely to kill themselves.
I’m talking about the rule-followingness of your average american, which is the bedrock of civil society. Every society has rot at the top. Few societies can survive rot throughout the base of the pyramid.
But who decides which rules are neutral? Even this is relative and subjective. Laws are not inherently neutral. A pH of 7 is only neutral because it is bounded by 0 on the left and 14 on the right. In a different system, perhaps it would be from 10 to 30 and thus a pH of 20 would be neutral.
In that example the number on the scale is less important than chemical properties of the solution. Reality is that which, when you stop believing in it, doesn't go away and all that.
You’re correct that rules are themselves to an high degree arbitrary. They can only be imposed by a source of authority that’s beyond question: God(s), elders, founding fathers, kings, etc. In the case of the U.S. it’s historical inertia going back to 1215.
> people just have to accept them as neutral and elevate them above their own sense of right and wrong.
I would say people need to accept them as neutral and make them their own sense of right and wrong. You can have a stricter personal set of right and wrong, but it needs to be something that society recognizes as a stricter in all ways.
Hehe, unfortunately that example undermines your otherwise good point, physical laws do not support your claim. Changing the units of a physical scale range does not change the relative position of a point inside that range, it only changes the name. 20 in a [10,30] range is still the absolute midpoint, and represents the amount of base or acid on an absolute scale.
Not sure I agree with the claim that we only allow “neutral” rules. That’s not necessarily true. And of course who decides which rules are neutral depends on which rule we’re talking about, and where you live, and (important) doesn’t depend much on whether the rule is subjective or not - the same processes are used even when the rule is objective. Some rules are fairly objective because they’re tied to health & safety. All humans require clear air & water, for example. Most tolerate a little pollution due to business interests, but whether pollution is poisonous isn’t particularly subjective, aside from the debates over the economic damage from small non-lethal amounts.
Your pH example actually proves the opposite. pH 7 is not neutral because it happens to sit halfway between 0 and 14.
pH is not inherently limited to that range at all. Sufficiently concentrated solutions can have pH values below 0 or above 14. A solution is called neutral when the activities of hydrogen ions and hydroxide ions are equal, which happens to correspond to about pH 7 at 25°C. Change the temperature and neutral pH changes too. So if you arbitrarily changed the scale to 10–30, that wouldn’t magically make 20 “neutral.” Neutrality comes from the definition and the underlying conditions, not from being the midpoint between two numbers.
I know it's off topic: but I am curious and this sounds both challenging to search for and likely to not get a straight answer from an LLM. Do you happen to know if this means that water may tip from neutral to slightly alkaline or acidic at different temperatures or pressures?
I have always found it .. peculiar that water just so happens to (as you aptly put it) "have all the activities of hydrogen ions and hydroxide ions equal" :)
This isn't a difficult question. I'm sure LLM knows these things better than I do.
Water is H-O-H; H+ and OH- both come from water. If there are no impurities, then for every extra H+ there is an extra OH-, so it's not that they are "happen to be equal". They're born equal.
Changing the temperature does change the concentrations of these ions so pH does change by definition. But the water remains neutral, since the ratio of H⁺ to OH⁻ is still 1:1
The closest we have to a "neutral rule" is "The Golden Rule":
"Treat others as you would like them to treat you."
It has a long history, both secular and religious. Pretty well everything flows from it, and if someone is doing "the wrong thing" whilst claiming to obey it then they are probably deluding themself.
The rule is suited to enforcement, since if someone does something "wrong", rather than immediately attacking them you can reasonably ask "Would you like it if I did this to you?". Limitation of power is built in.
I'd say expecting non-hypocrisy is also a top item. Someone says x behavior from a leader is disqualifying? OK, maybe that's their earnestly held belief and so worthy of consideration even if I disagree with their view. But if their behavior is the opposite/shows hypocrisy and suddenly isn't disqualifying? That should be a red line.
Because even the "golden rule" leaves a lot of wiggle room - for example, should marital infidelity (or x) be a dealbreaker for electing someone? Maybe, but looking at hypocrisy (and thereby actions) might provide better insight as to what those groups actually believe is the "correct" standard?
> The closest we have to a "neutral rule" is "The Golden Rule"
Mostly agreed, but a surprisingly large percentage of the population seems truly unable to feel empathy for others (and can even show glee at others being negatively impacted by something) unless it personally affects them (a prerequisite for "Would you like it if I did this to you?" to work?). They can be gung-ho about laws that negatively affect others but upset if it affects them. For example, the countless examples of "Community members vote for politician promising illegal immigrant deportation, then upset/disagree that long-time beloved community member deported", or "Voter voted for politician promising criminal-record-immigrant deportation, then upset/disagrees that partner with past criminal record deported".
What if I like to treat myself terrible and hurt myself everyday? It's okay for me to treat others that way?
Just because something has a long history (secular or otherwise) doesn't give it any merit by itself.
If we need some standard to judge against what is morally acceptable in the case I presented (no this doesn't apply if you like to hurt yourself and others) then you are back to defining a standard which cannot inherently be neutral.
> What if I like to treat myself terrible and hurt myself everyday? It’s okay for me to treat others that way?
No, that’s not what the Golden Rule said. It says to treat people the way you want other people to treat you. How you treat yourself is your own business.
There’s also a certain amount of making reasonable assumptions here. Obviously the intent is to get people to treat each other fair & well, not to set a logic trap and interpret this aphorism literally to mean you should hurt people if you’re okay with being hurt, even when you know other people don’t want to be hurt. Most people don’t want to be hurt. Obviously.
Yes, reasonable assumptions! But according to whom? The golden rule can be reasonable to you but not to me. But does that make me bad and you good? Not really. It just means we disagree on what it means to be a moral person.
Anyone who doesn't agree with your "reasonable assumptions" has bad morals can be twisted to mean any moral values based on what you mean by reasonable. For example, the church can say it is reasonable assumptions to burn witches and then twist reason itself to make it morally good as well. In that case how can we trust this system itself? If the answer is by using your own eyes and thinking for yourself, then why do we need to follow a specific fixed rule?
The reasonable assumption I was referring to is what the words in the golden rule mean, not what actions are moral or not. The golden rule is almost as far as it gets from a “specific fixed rule”, despite the name, and it doesn’t prescribe what’s bad or good or moral, and nobody upthread said anything about what makes you bad or good. It’s nothing more than a rule of thumb, an aphorism, a (perhaps extremely obvious) reminder that you shouldn’t treat other people in ways you wouldn’t like yourself, at a minimum. Is this hard to understand or something? The aphorism is already completely relative and subjective, there’s really no need to belabor that point, it’s built in.
How can you trust the system? What are you even asking? We have laws, a lot of them, and the golden rule is not one of them. But if you don’t hurt others, and others don’t hurt you, we’re off to a good start. Use whatever definition of ‘hurt’ you’d like, it doesn’t matter if it’s reciprocal.
The go-to example of a failure state in the golden rule that I am aware of is "thirsty person wants everyone else to jump their bones, thus the rule suggests that they should jump everyone else's bones".
The take-home being, as long as peoples preferences are different, the rule has some failure states based upon that.
And the wider example that this points to is that as long as everyone's values are different.. the rule loses a lot of it's luster. The more different another person's values are, the less you can rely on projecting your own values as a method to gainfully interact with them.
In place of that biblical aphorism (born from a monoculture no less), there is a lot of room available for us to build something more robust and sophisticated and the AI alignment problem offers a fine excuse to get cracking and try to formalize something already! ;)
Again, that’s an overly literal and straw man interpretation of the golden rule that seems nearly intentionally obtuse. The rule is not suggesting you should do anything that you know other people wouldn’t like. Jumping people’s bones is a very bad example, because that’s not something anyone should do without communication and explicit permission, otherwise it’s rape and it’s illegal.
If you understand and accept the reciprocal intent of the golden rule, via the above mentioned reasonable assumptions, not to mention the hundreds of years of examples and explanations, then it doesn’t really have a “failure state”. And, again, this so-called rule is not law, isn’t specific, and doesn’t cover all situations or all behaviors. It seems very silly to be nit picking this aphorism to death like this. It’s very simply a good faith suggestion to be kind.
The notion of fairness and reciprocity is not a religious idea, it’s common sense.
1. I believe GP was suggesting "golden rule" as the basis for governmental-wide rules to be enacted, not that each person should use unique rules based on their own "do unto me" preferences. (If actually applied, "What if this were done to me" also helps to get around the issue of people enacting rules only on other groups, as they wouldn't actually want to be personally treated the way they're proposing.)
2. Regardless, if basing rules on whether someone would want those rules to apply to them does not have merit, is there some better basis you'd recommend?
2. Yes, this is where I would push back because one can also assume there is no "better" basis in the strict sense that you can intellectualize morality/virtue only to a certain extent. And it is possible to argue that morality/virtue is often as much a psychological process as a purely intellectual one. So the idea isn't that the golden rule doesn't make sense or that it is objectively weak, but it doesn't map to the idea of actual morality in action. For example, a person may logically believe in the golden rule but that doesn't mean we should ignore the fact that the agent is not fully logical and will not always strictly adhere to a rule just because it is aware of it and aware of it as being Good. In that sense, what use is the golden rule if we are free to ignore it at all (which we often do)? That doesn't mean I'm saying the golden rule is objectively wrong again, but in ranking morality and deciding on very abstract ideas of what Good and Bad are, we ignore the actual psychological forces that are extremely relevant when it comes to the execution of morality in action. So to answer the question, the better basis would be to understand the psychological forces behind why we feel the golden rule is objectively a good and then examine them to understand if we are following the golden rule because we actually think it is good or because we live in a society where it is good and we will be shamed if we don't believe it. One might say it doesn't matter as long as people actually follow the golden rule but another interpretation is that the golden rule by itself doesn't tell us anything (or very little) about the moral character of the person applying it. So just expecting people to follow that rule after knowing it is placing too much trust in the human animal who is often wild and not thinking logically. It is then upon the animal to tame itself and it may do so out of servitude or out of independence and both might lead to equivalent surface values and match the basis perfectly as being morally good while in reality, both have very different meanings for their morals.
2 is, of course, mainly inspired by Nietzsche. I'm working on a short story where he and Plato debate whether a painting is objectively good or bad called A Canvas Called Virtue.
There's an obvious asymmetry in your rephrasing. The parents quote says "do unto others as they do unto you", not as you do to yourself. If you treat yourself terrible and hurt yourself, is it okay for others to hurt you too?
By logic, yes, if the hypothetical I likes getting hurt, they can also have a tendency to like getting hurt by others surely no? The problem is assuming these types of thinking doesn't exist and we only need to know the good to follow it and hence treating morality and values as a thing that stays beyond humanity itself in the form of eternal truths like the golden rule. But we don't think of morals on an intellectual plane purely. We think it is bad to hurt others because we want a good world where nobody is hurt, but that in itself is a stance where we assume everyone wants the same thing and if they don't, they just lack the reason and rationality to understand the obviously good values. But the mistake is assuming only reason rules how we see and execute morals in actual life.
It's the complete opposite of eye for an eye. If someone is being badly treated by others, most would want to be well treated instead, so the Golden Rule would say that you treat others well, even if others are treating you badly.
> In any society, you're going to have diverse views of "the right thing."
Not only that, but you're also going to have people disguising their personal, selfish ambitions for power or money (or both, those two ambitions are usually found together) by pretending to other people that they want "the right thing". Most politicians operate this way. (I can't say "all" because there are some examples in history of politicians who truly wanted "the right thing" and actually gave up personal power when it was necessary, for the sake of having "the right thing" happen. Cincinnatus is the often-cited example, for very good reasons.)
Which is another reason why legal structures such as the American Constitution, which constrains (or would constrain if actually followed, which is a whole other rant) the power of government to certain specific channels, are important to have. They limit what the power-seekers can actually do with that power once they obtain it, and provide ways for turfing said power-seekers out of office if enough people agree to remove them. (Then you probably end up electing another power-seeker, because those end up being the vast majority of the candidate pool... but sometimes you get really, really lucky and get someone like George Washington).
Free markets are designed around a selfish ambition for making money. You can only make money by pleasing your customers. And hence free markets are the greatest mechanism for prosperity.
That’s an ideal free market, but do you know of any large economies that actually meet this criteria? Happy customers are optional when you have regulatory capture.
Right, which is why touting oversimplified economic models is likely to be contentious ;)
Speaking of which:
> The more free market a country is, the more prosperous it is.
When do you think the US was at its most prosperous? Most would say somewhere in the mid 20th century, which was hardly the least regulated time in its history…
The highest GDP growth was in 1942, due to war production. But it required going into massive debt, and massive mobilization of adults into the factories, so I don't think that counts.
GDP growth in the 1800s is a rather dodgy time of statistics, as economic statistics were not collected then.
From 1800 to the Civil War, the US economy began to be industrialized. The Northern states industrialized, while the Southern economy stagnated.
The 1870s and 1880s are considered a very prosperous time. It was a time when industry really got in gear and was applied broadly.
I don't have hard facts, but prosperity in my life seems to have been driven by the computer industry, a pretty much completely unregulated sector of the economy.
But the example I gave was of politicians seeking power for the sake of making money. Which is entirely different from making it via the free market. I'm very much pro-free-markets, but I don't think that (for example) members of Congress should be exempted from the "no insider trading" rules. There have been multiple cases of politicians (from both major American parties — and I'm sure it happens in other countries too, America is just the one I know about) buying stock in a company that they knew was about to get a lucrative government contract, before that news hit the public. So they benefited financially from their insider position, something that is forbidden to everybody else. That's a market distortion, and benefits nobody but the politicians. That's a good example of the kind of selfish desire for money that I meant, and does not fit the free-market philosophy.
Free markets are also designed around participants of equal or comparable power. As long as market power is as skewed as it currently is, there are a lot of things wrong with making money that way.
> Free markets are also designed around participants of equal or comparable power.
No, they are not. No matter how big your company is, if customers don't like your product, you are going bust. Small companies regularly replace large ones. See the book "The Innovator's Dilemma".
Free markets do not resolve the tragedy of the commons. The fix is to not have commons.
For example, we are running out of fish in the ocean from overfishing. But there's no shortage of cows and chickens, despite massive consumption of them. The former is the commons, the latter is private property.
You pay market price for oxygen. It just happens to be 0 right now. There isn't any reason in principle that price can't change (eg, if you want to go underwater getting the oxygen will most certainly cost you something, if you want your air at a certain temperature or humidity that costs you too). If we set up a moonbase or something then it might well be that oxygen would cost something.
Much like how there isn't any reason you have to pay for food in principle. It could become so cheap and easy to produce, say, bread or cheese that it is available everywhere at no nominal cost.
So yes, you should. You already do, realistically.
It isn't just that I agree, but that I just wrote long - excessively verbose, I thought - posts upthread and downthread explaining how I expect the situation would play out, how it would affect me and how I'd respond to it. What more do you want from me?
It's a fact that, right now, the dude can use whatever amount of air he feels is appropriate for his circumstances. Even if I wanted to interfere I doubt I'm even on the same continent as he is, and it isn't my business anyway.
I suppose I'll just add in postscript; your not going to get much out of the conversation if you don't take it seriously. There are people who make great money selling oxygen. It isn't automatically priced at $0. In some hypothetical world where quality oxygen wasn't just floating around in the atmosphere, people would pay for it in the same way they pay for other essentials like food or water. Paying for water is about as crazy as paying for oxygen, they both basically just turn up out of the atmosphere. And there is precedent for a commons essential good becoming more expensive, food used to be something people just picked up off the ground for free. Or hunted down on unclaimed land.
I fear that this conflates open and closed access with exclusive property rights. It isn't untrue that asserting exclusive property rights on something makes it closed access[0], but there are other mechanisms for achieving closed access of a resource, like enforced regulation.
Slightly more formally, an assertion of exclusive property rights is a sufficient condition for something to be closed access, but it isn't necessary.
Though, admittedly, that does depend on what one's definition of a free market is. Is it unfettered commerce, consumer protections and suchlike be damned? Is it a system of commerce that ensures equitable access? I'm personally of the mind that, as long as I trade with certificates that bear Caesar's face (or trade with proxies for such certificates, like a MasterCard), he gets to make the rules in exchange for my being able to lean on his legal system to protect my interests, so I find that the equitable access angle is nice.
(Likewise, trading with Bitcoin or Ethereum or whatever the in-vogue cryptocurrency is today means that the code makes the rules, and I get to pay for the privilege of having my transactions indelibly entered into the distributed ledger and for the code governing those transactions to be buggy and exploitable. I'm still scratching my head at it.)
At the risk of building a strawman here, I'll caution that it's logically inconsistent to expect the state to enforce exclusive rights while also urging that strict regulation of a shared commons is an illegitimate market intervention.
--
0: That is, unless the title holder grants license, but that's a whole other conversation.
> I'm personally of the mind that, as long as I trade with certificates that bear Caesar's face (or trade with proxies for such certificates, like a MasterCard), he gets to make the rules in exchange for my being able to lean on his legal system to protect my interests, so I find that the equitable access angle is nice.
It is a minor point I suppose, but this is the other way round. Because Caesar makes the rules you trade certificates that bear his face. It takes vigour and energy on the part of law enforcement to stop people from moving to private currencies.
I'm unsure that I agree. History has borne out a lot of evidence that people will jump to other means of paying for things in the face of the local currency collapsing, even in the face of amped up (but nonetheless impotent) enforcement.
> that does depend on what one's definition of a free market is
Sigh. No need to make up one's own definition. Googling "free market":
"A free market is an economic system where prices, wages, and the flow of goods are determined by supply and demand. There is no government control or central planning telling people what to buy, sell, or make. Instead, private choices and voluntary trades drive the economy."
As it turns out, I'm not making up my own definitions here. The view of a free market being a market with equitable access is attributable to Adam Smith from his Wealth of Nations. He bases his understanding of this freedom on the absence of private rent-seeking and absence of monopoly privilege (though in 1700's vernacular).
Henry George in his Progress and Poverty makes similar gestures toward defining a free market this way.
Part of the reason why it's important to consider other definitions (and other economic models) is that there is an important result in economics from the 1970's that, more or less, establishes the lack of a guarantee that the demand curve in an aggregate demand model (a macroeconomic model) will slope downward. This makes the aggregate demand model less than useful for a priori arguments about supply and demand in the macro context; they must instead be approached a posteriori.
It's also the big reason why I'm uninterested in a colloquial definition that is heavily filtered through von Mises and Friedman.
People often try to derail debates by arguing about the definition of a word. I'm not interested in such.
The government tries to repeal the Law of Supply and Demand all the time. Unsuccessfully. A while ago, a good friend of mine asked me what would happen to jobs if the minimum wage was raised. I said the number of jobs would go down. He said "aha! here's a study that proved that the jobs increased!" I said I don't need to read it, because the researchers goofed.
Some years later, the study was retracted because it was flawed.
It was like a story on HackerNews some years back that made a claim that electric cars were 90% efficient. I knew that was hokum right off the bat. But I still had people with PhD's in engineering saying it was true.
The car loses 10% just in losses in the battery, let alone anything else.
So I did some research on the author. Seems it was a person without a degree in physics or engineering who worked at a ski resort.
Please forgive me. I happen to have a formal background in economics by way of training as an actuary, and I can't take seriously the implication that the standard model is a law. Supply and demand aren't invariant under all conditions.
I'll flip this around and instead elucidate when it does apply if that's alright.
The supply and demand model only applies to analysis of microeconomic systems with perfect competition, namely of systems that lack monopoly and monopsony; that have perfect information; that lack an ability of a single economic actor to affect the price in the market; that lack externalities[0]; that lack transaction costs; that lack unknowable probability distributions of outcomes; that lack economic actors that change their behaviors based on what they expect other actors to do; and that lack non-market rules or structures that restrict prices, quantities, or entry. These assumptions are all-or-nothing, and there are a lot of them. It's also an equilibrium model, and we aren't guaranteed to have equilibrium.
For macroeconomic analysis (i.e., analysis of multiple sectors of an economy or multiple economies), it's problematic because of a theorem from the 1970's due to Sonnenschein, Mantel, and Debreu. I've stated it elsewhere, but it also has the implication that the behaviors of the actors in a microeconomic system do not carry over to the macroeconomic context. This tends to violate many of the assumptions above. (Though, if it isn't obvious how or why, please ask.) Furthermore, in the macro context, I don't think we'll ever have equilibrium; at least, I'm having a hard time thinking of an example when it exists.
Let's bring in a physics analogy. While we can look at mechanics through the lens of elementary algebra, those tools really only give us the ability to look at static force-balance problems for springs and pulleys in equilibrium. To model such a system more closely to how it behaves in the universe, with damping, inertia, and feedback (and whatever other time-dependent behaviors I may be forgetting), we are best served moving to differential equations.
Economics is no different; the supply and demand model is a lot like Hooke's law in its simplicity and its applicability. (In fact, in my modeling, I very heavily used numerical solutions of PDEs.)
--
0: When the retail price of kerosene tanked by 70% between 1860 and 1880, this resulted in millions more kerosene lamps and lamps broadly being lit for longer periods of time. This had externalities in the form of more soot and particulate matter (and probably also respiratory illness, but I couldn't seem to find anything with observations from the time period).
> The supply and demand model only applies to analysis of microeconomic systems with perfect competition
I'm going to stop right there. Perfect competition is unnecessary. Part of perfect competition is perfect information.
No transactions have perfect information. There is always "risk" involved. And risk contributes to determining the price of something. Ever wonder why used cars lose a third of their value when you drive a new one off the lot? It's because of the risk that a person might be selling that almost-new car with a hidden expensive fault in it.
Also, risky investments come with higher returns. Safer investments come with lower returns. The lack of perfect information gets a dollar value for the amount of imperfection.
Risk is absolutely part of the free market, and absolutely a part of the Law of Supply and Demand.
It is definitionally a precondition to applying the supply and demand model for analysis.
> Part of perfect competition is perfect information.
This is mostly correct. It's actually a biconditional: perfect competition iff perfect information.
> No transactions have perfect information.
This is correct.
> There is always "risk" involved. And risk contributes to determining the price of something.
Risk (due to Frank Knight, sometimes called Knightian risk) is a term of art that refers to known probability distributions of market outcomes. My professional training is literally to build pricing models against these.
> Ever wonder why used cars lose a third of their value when you drive a new one off the lot? It's because of the risk that a person might be selling that almost-new car with a hidden expensive fault in it.
No, I can't say I've ever wondered this; I've not been around a lot of new cars. (See also: the whole Mennonite thing.) I know that it's because of the term of art that we call uncertainty (again, due to Frank Knight, sometimes called Knightian uncertainty), which refers to those unknown probability distributions of outcomes that I listed as a precondition to applying this model for analysis. I can't price against those.
A used car market is what we call an Akerlof market, which is a market with a feedback system that has a whole lot of pathologies linked to information asymmetry. This also happens to be the textbook example of adverse selection, which is itself an example of how the supply and demand model fails to predict the market due to that information asymmetry.
> Risk is … absolutely a part …
This is correct with the words written here, but I'll caution that risk as a term of art has been misused.
Ironically you are making his point. Countries that have stronger respect for property rights dump way less or no garbage in the oceans as the countries where there is no such respect.
>You can only make money by pleasing your customers.
If only it were so.
Alas, in the real world enshittification, shrinkflation, skimpflation, dark patterns, planned obsolescence, vendor/platform lock-in, rent-seeking, regulatory capture and the like absolutely rule the day, due to a host of free market failures.
I don't claim to have a better alternative. But I find your take a bit strange. Are you as a customer satisfied with how all of this is working out?
To bring some clarity to this, it seems people are talking about being "forced" in different ways. WalterBright is using the correct definition of "forced" that means "you must buy this thing or else I'll shoot you / throw you in jail / fine you for non-compliance". Which does apply to some transactions: for example, in America you are (since the passage of the so-called Obamacare bill, officially called the Affordable Health Care Act) forced to buy health insurance: if you don't, the government will impose financial penalties on you. (Many people have health insurance through their employer so they don't pay for it directly, but someone is being forced to pay for it).
But other people are using "forced" in the colloquial sense: "I'm not offered the thing I want, I'm only offered the thing I want bundled with something I don't want", e.g. I just want a TV, but I can't buy just a TV, I'm only offered the choice between a TV bundled with advertising or nothing at all. Hobson's Choice isn't a pleasant situation to be in, but you're not forced to buy that TV; you had the choice to buy nothing at all. It's not the same concept as "buy this product or we will impose a penalty", such as how Americans are now forced to buy health insurance.
WalterBright - to your question "when was the last time you were forced to buy something you don't want?", the correct answer would have been "March 2010", when many people were forced to buy health insurance that they didn't want. Which goes to show that although many parts of the American economy are a free market, health insurance is not. "Coincidentally", prices went up once there was a lot more truly forced demand. Huh. Who ever could have predicted that when you forced more people to buy a product, its producers would be able to raise prices? Wow, so completely unexpected a result... no economists at all would have predicted that... (Yes, Friedrich Hayek, I see you screaming into your pillow. It's okay, I'm being sarcastic).
The washing machine broke after 18 years. It was a cheap model at the time, but it held up well until the end. I'm under no illusion that the 50% more expensive replacement will last anywhere as long. You know, the old "they just don't build 'em like that anymore" that even the sellers tell you freely.
I'd like to buy quality products. For example, I own a coffee machine for which the manufacturer provides spare parts for decades. But I'm not willing to spend 3x for an appliance when there's no realistic expectation to get 2-3x the use of it since it's not economically repairable. So the rational choice is to buy semi-cheap and throw it on the heap when it inevitably breaks sooner than the last one. I hate that game, but I'm not made of money either.
Then the TV died. I did some research online and then spend a very disappointing hour browsing a local electronics shop to get a hands-on feel. It's all "smart" shit the software of which will go out of support within 5 years, with dedicated remote buttons advertising streaming services I don't use, too large screens and/or bad build quality, abysmal sound all around, and, not to forget, stuffed full of surveillance and ads. Out of sheer desperation, I got alarmingly close to spending $1.900 for a premium brand 43" that did tick all the boxes - namely, just being a TV that's as good and inobtrusive as the $700 one from 12 years ago. I finally resorted to buying an 7 year old unit from the same premium brand third hand for 1/7 the price. Which in the event turned out to be a really good deal, I admit, but I don't quite think the used market is what we're talking about here.
It did not feel at all like the market for new products catered to my preferences. These may be a bit peculiar, but FWIW, I take that's a sentiment quite a few people on HN share: questions about "good dumb TVs" come up every so often, so I'm not alone in this.
> To have a functioning civil society, you actually need the opposite of what you're saying. You need a collective general trust that people will follow the rules regardless of what they think is "the right thing."
That implies that there is a collective general trust that when the rules are not the right thing that they can be addressed.
> In any society, you're going to have diverse views of "the right thing." To have a functioning civil society, you actually need the opposite of what you're saying. You need a collective general trust that people will follow the rules regardless of what they think is "the right thing."
Only slightly. Multiculturalism explodes it, but it's not so very different amongst people with shared language, history, faith, and heroic stories.
No, no, no and no. There's is right and wrong and there are evil people.
No all cultures are equal: torturing kids for as long as possible before they die, to extract as many tears as possible to please the gods, used to be a thing.
We do not all need to agree on "neutral" rules: we can agree it's an evil thing to do to torture kids for as long as possible, to extract as many tears as possible from them.
Don't be one, two or three of the "won't see" / "won't hear" / "won't talk" monkeys: don't be neutral. Fight evil.
At the moment for example there are 300 million women/teenagers/girls alive that have been genitally mutilated, including in the west: you're allowed to not be neutral and take a stance and fight against FGM.
At the Bataclan in Paris islamists with AK-47s (which are forbidden in France btw) lined up 300 people and slaughtered them: you're allowed to not be neutral and take a stance against islamism.
In January the islamist iranian regime killed 30 000 of its own unarmed civilians: same thing, you're allowed to not be neutral.
I don't care if islamists are convinced they do the right thing by spreading terror: they are evil.
And I'm not a religious person.
And btw western societies are based on rule that are mostly not neutral: we don't believe in harm to others, for a start. Even if in several cultures (past and present), that was normal.
At the moment for example there are lots of talks in french media about the status of women in Afghnistan since the talibans came to power.
For, as a western society, we do not care if others believe it's the right thing to mutilate girls, kill your enemies and enslave their women and daughters, etc.
The fallacy of gray is really a nasty thing and no good shall come to civilized societies for resorting to it.
The phrase "the right thing" is load-bearing, to steal a Claudeism. The Muslim Brotherhood that ran the country before El-Sisi thought they were doing "the right thing." El-Sisi also thought he was doing "the right thing." Egyptians mostly thought El-Sisi was doing “the right thing” during this time period. According to multiple independent opinion polls, his approval rating was high during this period because people were grateful to have stability.
In any society, you're going to have diverse views of "the right thing." To have a functioning civil society, you actually need the opposite of what you're saying. You need a collective general trust that people will follow the rules regardless of what they think is "the right thing."
Logic compels this conclusion. People who disagree on fundamental aspects of how the world and society should work cannot cooperate in a civil society if we trust that everyone will follow their vision of "the right thing." The only way we can cooperate is if we agree to neutral rules and procedures, and have a collective general trust that we'll all follow the rules regardless of our view of wrong or right. The thing I admire most about Anglo-American culture is that people will jump off a bridge if you give them a court order that complies with all required procedural formalities. That's how you create a civil society.