Re: Market failure to sufficently weigh the future

From: Robin Hanson (
Date: Wed Nov 01 2000 - 12:34:42 MST

Hal Finney wrote:
> > the paper isn't about what is adaptive anyway - it is about what would
> > satisfy the preferences we have, however we got them and however adaptive
> > they are.
>But isn't it relevant that changing society's discount rates may be
>harmful? Or is that simply off topic for this paper?

Harmful in what sense? Making people choose actions that are less adaptive
means making them choose actions that lead to fewer descendants. The paper
is about what actions better satisfy the preferences of the people involved,
whether that leads to more or fewer descendants.

>What if someone wrote a paper proposing to change prices. Let's lower
>the price of gasoline to 10 cents a gallon. That would improve social
>welfare because there are more consumers than producers. Is it reasonable
>to neglect the impact of that change on the supply of gasoline, and to
>look only at how this satisfies our preferences?

As economists usually define social welfare, this would not improve social
welfare. Even if a few consumers gain, many more consumers would lose, as
would producers. All these gains and losses are from the point of view
of the preferences of the people involved.

Robin Hanson
Asst. Prof. Economics, George Mason University
MSN 1D3, Carow Hall, Fairfax VA 22030-4444
703-993-2326 FAX: 703-993-2323

This archive was generated by hypermail 2b30 : Mon May 28 2001 - 09:50:19 MDT