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gjm comments on The progressive case for replacing the welfare state with basic income - Less Wrong Discussion

-5 Post author: morganism 11 September 2016 10:41PM

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Comment author: Lumifer 12 September 2016 02:50:23PM 0 points [-]

Then, oversimplifying in some obvious ways, we have the following:

A bit too much oversimplification for my taste. In particular, there is a rather important bit missing: what happens to the price of the products (or services) that these people produced. Let's say they made widgets. In a market-based economy the price of the widgets would go down considerably and this will lead to a lot of extra consumer surplus for all buyers of widgets. This could easily be the most important effect and the greatest source of utility.

And because of that your option 2 is actually very unlikely to happen, other than in a monopoly-like situation, even in the short run.

In the long run, all of these are probably better than leaving things as they are.

There we go :-)

we only get worlds designed by Moloch

I don't know about that. Moloch has to wrestle with the invisible hand of Adam Smith :-D and the world we are currently living in isn't half bad, is it?

Comment author: gjm 12 September 2016 04:19:36PM -1 points [-]

In particular, there is a rather important bit missing: what happens to the price of the products (or services) that these people produced.

Yeah, in retrospect I should have said something like

(In this case, what probably happens next -- at least if there is competition -- is that the company lowers its prices somewhat. So now the business owners win and their customers win. In the long run these lower prices may lead to new jobs.)

... Oh, wait. I did.

Comment author: morganism 12 September 2016 10:10:30PM 0 points [-]

No, what happens is that the original producer plays a stock short on the new guy, does an M & A on them, then liquidates the new company while trapping any intellectual property and patents in the safe.

Then we lose competition, price pressure, and innovation.

And even more folks are out of work.

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