Thursday, December 7, 2006

Aad Caccbddbbddd, Ac Baba Ccbb

Help this quiz rank you in your adherence to four interestingly different economic schools of thought. Sample question:

18. What is the role of equality and inequality?

A - The modern emphasis on equality is the great policy advance of the last century. No longer does the political and economic system exclude women and minorities from participation but rather includes them as a matter of law. These groups tend to be artificially undervalued by the "invisible hand" of the market, which is why there is a role for anti-discrimination and public-accommodations law. The welfare state, too, has benefited society by insuring that the benefits of rising wealth are spread throughout society, so that the rich do not become richer at the expense of the poor. We've come a long way, but we still have a long way to go.

B - Equality is a term that properly relates to mathematics but not to social science. Human beings are unequal in their endowments, opportunities, and will to achieve. Unequal does not mean inferior or superior; it merely means different. Differences are the very source of the division of labor, and, within a market setting, lead not to conflict but cooperation. While differences should be celebrated, property owners have every right to treat people unequally because it is owners that bear responsibility. Legislators, however, should not have any concern for bringing about equality of result or opportunity, either between individuals or groups of individuals classified according to any criterion. The only place for equality concerns the law, which should treat all individuals the same without regard to their station in life.

C - Inequality is an intrinsic feature of a social structure that is mired in a prejudicial overhang from the long and shameful history of the manner in which Western society has treated women and other minorities. The prejudicial impulse, rooted in the spirit of conquest that gave birth to Western capitalism in the first place, is a form of violence and yet part of the corrupt infrastructure of the market economy itself. If the owners of capital were left to their own devices, excluded groups would remain so in perpetuity, so society had to act to restrain them. Full equality will continue to elude us, so long as we have a society that treats people as goods to be bought and sold, and so long as we put private ownership for the few above the common interests of us all.

D - It is a great mistake to make equality of result a policy goal, because egalitarian legislation can kill incentives to improve. Punishing the rich is self defeating, even for the poor striving to make their way. Equality of opportunity, however, is different. It is something everyone merits by their very dignity as a human being. Thus should a nation strive for quality educational institutions, institute a limited inheritance tax, and otherwise assist those who, through no fault of their own, lack the means to gain entry into the division of labor. Once these institutions are in place, we will find that the forces of market competition will achieve egalitarian goals through predominantly voluntary means.
Take the quiz -- and Choose Your Canada!

2 comments:

Ayn Steyn said...

Mike,

Are you an anarchist? You answered (C) on Question seventeen regarding monopolies, which implies anarchism. I would argue that this is not the Austrian view and that the correct answer should be (d).

Mike said...

Hi Ayn, thanks for asking. The anarchist/minarchist distinction isn't very important to me so I won't step in that quagmire today.

My problem with d):

What is left for regulators to do? As Adam Smith said, they should prevent business conspiracy, blatantly predatory behavior, and otherwise assure a level playing field leading toward genuine competition.

"Should" nothing. The force of the falling water in the perpetual motion machine "should" be enough to bring the wheel around again forever.

Alas government can't do any of these things, since it's more in the regulators' interest to crush competition to existing sugar daddy firms. Then, we call that levelling the playing field, fighting predatory behaviour, saving the planet, etc.

Finally, some goods lend themselves to being best provided by monopolies, e.g. courts and defense.

I haven't seen any good argument why this has to be the case, but I don't really care.

In contrast c) says nothing wishful or false.