From: pmetzger@snark.shearson.com (Perry E. Metzger)
Subject: Re: Evidence for the market
Organization: Partnership for an America Free Drug
Date: Thu, 21 Jan 1993 19:53:25 GMT

Chris.Holt@newcastle.ac.uk (Chris Holt) writes:
>violett@indiana.edu (Andrew J Violette) writes:
>>Chris.Holt@newcastle.ac.uk (Chris Holt) writes:
>
>>>Hee hee.  Then why do I have such faith in the free market, in
>>>limited circumstances?
>
>>I am a little bit confused as to what your definition of free market is.  A
>>free market defined only under "limited circumstances" is not a free market,
>>it is a regulated market.
>
>It is possible to have a free market in beans and a regulated market
>in medical care, side by side.

Yes, but its completely irrational to run an economy this way. There
is no reason to believe that the market that could allocate beans
efficiently couldn't allocate health care efficiently. This is like
saying "I'll believe that evolution could alter plants, but animals
are obviously created by God and not subject to the whims of the
world."

>The point is that modelling a
>free market, one makes assumptions (sufficient diversity among
>suppliers and buyers for supply/demand curves to be continuous and
>monotonic, sufficient information about a product that the buyer
>can act rationally); the less likely the assumptions are to hold,
>the less accurate the model, and the more it is necessary to add
>other constraints.

I've never seen anyone insist that the curves must be continuous and
monotonic or that there be more than a trivial number of suppliers of
a good. There are luxury goods, for instance, for which the demand
curve rises with the price and then falls again after a certain point,
and the market models seem to work perfectly fine with such goods.
There is also little or no reason to assume that curves must be
continuous -- the models seem to work fine with continuous models.

Even ignoring this, however, I'd say that for any market socialists
such as yourself care to regulate, such as health care, there are
loads of suppliers and the curves are monotonic and continuous.

Beyond this and ignoring models, there is the fact that all the
evidence of the real world seems to show that there don't seem to be
exceptions to the rule that the market allocates best. Even in the
situations that seem to be "bad", it appears that no solution other
than the market does better than the market.

We thus have three reasons to believe that your position is irrational
-- that your assertion that the models are flawed is false, that the
markets which you wish to regulate are not the ones for which you
claim that the models are flawed, and that ignoring the models the
real world contradicts your view.

However, as I've said before, this is all pointless. Its been obvious
to me for years that you (and I am refering here specifically and Ad
Hominiem to Chris Holt) start with your conclusions and work your way
backwards, so there really is little point to this. You'll argue all
day and all night, as long as we care to keep replying to you, and
you'll deny everything thats shown to you. Why should we bother
arguing with you when you are completely unreasonable and will ignore
any amount of evidence you get handed?

--
Perry Metzger		pmetzger@shearson.com
--
Laissez faire, laissez passer. Le monde va de lui meme.
Newsgroups: alt.philosophy.objectivism