Category: Series: Allocation of Limited Resources
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Allocation of Limited Resources – Part 9 (The Role of Production)
So far in this series, we have examined several possibilities for the distribution of limited resources. While face-to-face communities have the wherewithal to employ several criteria in allocating limited resources, larger aggregations of people do not. I’ve argued that market exchange is by far the most just and efficient means of allocating limited resources across…
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Allocation of Limited Resources – Part 8 (Government Limitations of Ignorance and Vested Interest)
I began this series with the analogy that presented various modes of allocating limited resources. It concluded that auction … markets … is the most efficient and just system we have. In the following post, I explained that we deal with two types of community: Face-to-face and commercial society. Face-to-face communities can often efficiently and…
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Allocation of Limited Resources – Part 7 (Redistirbution of Income)
Today we come to probably the most controversial role government plays in the market, redistributing income. In the broadest sense, income gets redistributed every time something is taxed, regulated, or subsidized. Here I’m focusing particularly on redistributing income to the poor. Some believe government has no role to play in alleviating poverty. Others believe government…
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Allocation of Limited Resources – Part 6 (Other Government Interventions)
So far, we have seen how government sets and enforces rules by which economic transactions occur. Government sometimes intervenes to remedy negative externalities and to leverage positive externalities. What other roles has government played in a market economy? Information and Transparency The market economy is based on the presumption that buyers and sellers are well…
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Allocation of Limited Resources – Part 5 (Positive Externalities)
We saw in the previous post that some types of market exchange involve negative externalities. People not a party to a transaction end up bearing part of the cost … the costs “spill over” onto them. But there are also cases of positive externalities. In these instances, the market exchange benefits not only the parties…
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Allocation of Limited Resources. Part 4 – (Negative Externalities)
At the core, market exchange is about well-informed buyers and sellers freely exchanging to their mutual advantage. But what happens when the transaction price doesn’t capture all the cost or benefits of the transaction … that is, someone external to the transaction bears part of the cost and/or reaps part of the benefit? When this…
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Allocation of Limited Resources. Part 2 (Two Communities)
I wrote in the previous post that markets are the most just and efficient way of allocating resources in mass society. But as I noted at the end, markets are far from perfect. Neither are they appropriate for all forms of human interaction. I want to spend the rest of this series of posts discussing…
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Allocation of Limited Resources. Part 1
Recently I finished reading James Halteman’s The Clashing Worlds of Economics and Faith published in 1995. It is a revised and expanded edition of his book Market Capitalism and Christianity, which I read in grad school back in 1988. It is written from an Anabaptist perspective, and while I disagree with him at various points…