Well there certainly are neanderthal conservatives who will call every country on earth too socialist and therefore not free market.
There certainly are whack-job liberals who will tell you 'corporation control everything. Free markets are a lie We need to end the charade of capitalism."
I assumed you and I were both using the more conventional earthly definition used by most humans.
Well all the examples that were listed there aren’t true free market systems, but like Gaius said, you have to take heuristic shortcuts when talking about real life.
Because nowhere does the perfect textbook definition form of any system exist.
Right and these types of things are what leads to the critical thing impacting economies and economic activity today- too much rentierism and not enough actual competitive economic activity.
And government policies…both right and left…are at the root of it all.
Well, without PPP, pretty sure my company would be gone. Or at the very least, it’d be me and 1 employee instead of 8 of us now having a really good year.
So…I mean, sure, of course, that money is contributing to inflation. But it really was a lesser of two evils situation at the time.
Which are what?
No, that’s just silly.
The health care system would have collapsed, and deaths would have been 10X, which would have put a tremendous drag on the economy.
and FWIW, yes, inflation is a real problem right now. But UE is super low, spending is still strong. We had a blistering expansion in GDP.
From a business perspective, this is way better than say 2009 collapse of the economy.
Rentiers bleeding the productive economy, and being incentivized by governments to do so.
So in short, worker productivity is not being fed back into the productive system, but is going into the pockets of the rentiers.
The simplified version. There’s a more complex explanation having to do with energy and resources, but I already know your skepticism towards both of these hypotheses.
Well of course that is primarily a medical question.
should we believe
– The British Medical Journal study that said the lockdowns did almost nothing to prevent deaths?
– The one form Harvard Medical School saying that after the fourth month the shut downs did almost nothing to prevent deaths
– The one from World Health Policy Journal stating that NONE of studies can be considered scientifically conclusive?
– The common sense fact that much of the country (flyover country) and the economy is rural has very little closw person to person contact and perhaps should not have been shut down to the same degree.
Some would have us believe “I love big government so Harvard University is stupid! All studies supporting my view are correct all others are wrong!”
What we know is the economist of every political leaning agree
How? I don’t understand what that means.
“Economic rent” equals profit beyond absolute bare minimum such as might be used to
The latter is emotional spin placed by you, but is technically correct. 
Essentially it is money paid for no value added by the person receiving the payment.
Oftentimes, opportunities for economic rent are created by government policies that favor the rentiers.
If I invest in something (like inventing the lightbulb or the smartphone) and make 6%, but everyone else made only 4% person might say
Or you might say
-“Yargh! You made more than the buggy whip manufacturer. You made an economic RENT”
The concept of rent = evil is needed
by luddites, and
by those who hate the pharmaceutical industry etc.
should innovators make a bigger profit than non innovators?
or
should buggy whip makers be paid the same as the person who invents clean energy cures cancer and doubles the world food supply?
Obviously innovation is good.
“Rent” is the proceeds that innovators get over non innovators.
No the concept of rent = evil is not needed.
Economic rent is a real term, with a real definition. Again, broadly, it’s excess profit that does not arise because the entity receiving it created actual value.
In a perfectly free market, it wouldn’t exist because competitive pressures would eliminate it.
In the real world, it acts as a brake on the economy if there’s too much of it.
“It wouldn’t exist?” Hogwash
Unless the supply and demand curve are identical (they cannot be they slope in opposite directions) there will always be rent.
Think about the non-innovator vs the innovator.
Both create the same product the innovator does it more efficiently. In a free market he MOST CERTAINLY gets to keep the benefits of his efficiency increase.
Think about the innovator who invents olars panesl so coal is not needed as much. If digging coal paid the same no one would ever innovate and create solar power.
It is because the innovator who created solar power can make RENT beyond what the coal miner makes that solar power was harnessed in the first place.
The free market allows that rent. the free market rewards such innovation . . . it is government loving liberals who want to use government to stomp out rent that exists in the free market.
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Thank God the Bible tells us “the workman deserves his wages” (1 tim 5:18)
instead of “all workmen except full;-time innovators deserve their wages.”
Happily the US Constitution specifically enshrines the right to economic rent
Article I Section 8 | Clause 8
(Patent and Copyright Clause of the Constitution. [The Congress shall have power)
“To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.”
God, the US Constitution and free market capitalism all support economic rent for innovators. The ONLY way to stop it is to grow the government and have the government prohibit it.
No in a perfectly competitive economy with perfect information, there would exist no opportunity for someone to extract profit that was not commensurate with the value added to get the profit.
The “innovator who is doing it more efficiently” is not extracting economic rent…he is extracting profit commensurate with the value he is adding by becoming more efficient. This is an example where productivity is being recycled back into the productive economy.
I don’t think you understand what economic rent is.
The term ahs been used different ways.
I was using it in the braider sense, which includes all “producer surplus.”
It could be applied more narrowly, including only such things as
→ the excess profits the solar industry receives when the government grows and interferes with other green and non green sources of energy.
→ the excess profit steel importers receive when the US government hobbles US industry with eco-laws that do not exist in China.
You know
Free market sys one thing. Government says another . . . as a result some guy gets an economic rent. There certainly is a lot of that kind of rent and that kind of rent cannot exist in a free market, but I don’t think that is what you meant.
I’m applying it in its strictest sense because in it strictest sense is when too much of it becomes a drag on the economy.
In its strictest sense it is the difference between actual profit and free market profit.
In other words, profit generated not by actual value add, but by some other factor. Unearned income is another term for it.
In an imperfect economy, there will always be some economic rent.
Where it becomes harmful is when we actually start incentivizing rent-seeking and creating conditions for rent-seeking to “flourish”.
And yes- as you showed above, government policies often create the conditions for rent-seeking to be incentivized.
Both Democratic AND Republican government policies.
PS I was upfront from the beginning that I was focusing on the narrow case. Looking back on our discussion, I thought I was quite clear on that. You should have told me you didn’t know what definition I was using.
And if you DID know, you then followed with a disingenuous response in order to assign a motive to me. Please do not do that in the future.
Food for thought:
The day President Joe Biden took office, the national debt stood at $27.7 trillion. Eight months later, it is approaching that $28.4 trillion limit. But Scott’s finger-pointing ignores how the debt got as big as it is. Thanks to spending for wars, crises and mandatory government programs, along with a series of tax cuts, the debt continued expanding throughout the post-World War II period, regardless of which party controlled the White House or Congress.
In nominal dollars, since World War II, just over 60% of the growth in the debt took place under Republican presidents, and about 40% under Democratic presidents.
Both run up the deficit (really want high starting under Reagan), but the D party tries to lower that by raising taxes…the R party gets in charge again, then lowers taxes…increasing the deficit.
A pyramid from some religion. Nice but I wouldn’t base laws on it.
