Wednesday, August 21, 2013

Jonathan Catalan makes an odd claim

He writes: "Say there is country A who conquers countries B, C, & D, imposing external costs on country Z, and even threatening large future costs (e.g. an invasion). It may make sense for country Z to increase war spending to organize a way of reducing total future costs by preemptively eliminating A’s capacity to impose costs on Z. That doesn’t necessarily mean that Z’s war spending creates a net benefit, it just mitigates the loss."

I guess health care spending doesn't involve a net benefit either! That is just mitigating a loss - my eventual breakage and death.

Of course what's really at issue here is how we're netting things out. I can't control what A does. So I take it as given. When I assess net benefits it's going to be based on the consequences of my decision.

10 comments:

  1. Um yea, there's disutility in a lot of things. The same is true with labor, for example. But things like wars aren't inevitable.

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    1. Meh. They probably are inevitable.

      Why would you think they aren't?

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    2. I can think of a lot of wars that could have been avoided. Also, we are clearly better off in the post-WWII environment with no wars between industrialized nations.

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    3. And if wars weren't inevitable, we wouldn't spend so much effort in building institutions to avoid them.

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    4. You need an edit function. Sorry for the third comment in a row. Above, I meant, "If wars were inevitable..."

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    5. Well right, just like I know a lot of illnesses that could have been avoided. If that's all you're saying then yes I agree.

      But if that's all you're saying then my health care analogy seems to hold just fine.

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    6. I'm not sure you agree, because in your previous response you said the exact opposite (war is inevitable).

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    7. You would agree that illness is inevitable in the sense that peoples' bodies will always break down at some point, right? But you would also agree that illness is not inevitable in the sense that we are able to prevent many illnesses, right?

      You clarify which you meant in the first comment and I'll tell you whether I agree with you or not.

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  2. Are the global net benefits to war spending comparable to society's net benefits to healthcare spending? My first impression is that there is an intrinsic contraction in that.

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  3. Let's suppose that there's an epidemic of an illness. The illness is curable, but at quite a high cost. So, everyone spends money to cure themselves of the illness, this raises GDP. This is another example of the same kind of problem.

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