November 13, 2012 10 Comments
Tenured economics professor Bryan Caplan has been entertaining us all with some fascinating hypotheticals designed to challenge Steve Sailer and similarly-evil immigration restrictionists to examine how far they would go. These hypotheticals offer a fascinating insight into the economics mind of Professor Caplan. For example, he asks:
Would it be morally permissible for the U.S. to impose a tariff on imports that raised median U.S. income by 1% but reduced mean non-U.S. income by 10%?
From this hypothetical, we learn among other things that in Professor Caplan’s expert (and libertarian!) economics view, tariffs are a reliable means of raising income. We also learn that the rest of the world could take a (real, I assume?) 10% hit to its income and that wouldn’t affect our income. If you can follow along with these premises of Caplan’s, then perhaps you can answer the question, and prove to him that you’re not evil like Steve Sailer.
But I’m still just fascinated by the questions themselves. Here are some earlier hypotheticals Caplan raised:
1. If conquering and enslaving Canada would increase American per-capita GDP, should we therefore conquer and enslave Canada?
2. If we could forever end world poverty by reducing American per-capita GDP by a penny, should we refuse to end world poverty?
3. If we could costlessly exterminate all Americans who produce a below-average quantity of GDP, should we exterminate them?
Ah such fascinating economic insights to be mined! Apparently you can, conceivably, exterminate half your population without affecting the individual-GDP of any of the survivors (who, I infer, each have unchangeable ‘individual-GDP’ statistics attached to them, like a D&D character). Apparently there is such a thing as ‘forever ending world poverty’ – scarcity can just be abolished, ‘forever’, if we can figure out the right policy. (And for only 1 cent of U.S.’s per capita GDP too!) And apparently there are great economic gains to be reaped by conquering and enslaving Canada. Who knew?
I just gotta audit this guy’s macro class!
The problem here is that, because he’s so desperate to try to expose the evil of Steve Sailer, Caplan seems stuck on offering hypotheticals that are either infeasible or unstable.
Infeasible means we can’t-get-there (or, at best, can’t-get-there-from-here). It is to posit a state of affairs that is basically not possible. Think of questions like,
“If we could build a warp-drive starship by reducing our GDP by 99.999%…” Sorry, if you reduce our GDP by 99.999%, I don’t see a warp-drive starship in our future anytime soon.
“If we could make ourselves instantaneously 1000x richer by killing Joe Schmoe…” Hold up, unless God or a genie or (more likely) Mephistopheles is somehow involved, I know of no valid economic theory according to which killing Joe Schmoe is a reliable method of doing that.
“If we could eliminate hunger by banning agriculture…” Yeah, no, I don’t think the latter will actually do the former.
Unstable means that, even if I could perhaps envision Caplan’s hypothetical on Day One, it just wouldn’t stay that way. For example he wants Steve Sailer to tell us whether he would (via tariff policy, LOL) trade a 1% increase in U.S. median income for a 10% reduction in mean income in the rest of the world. But wouldn’t the resulting world depression come back to bite us? and eat away that supposed “1% increase” we thought we had banked? Of course it would. These unstable scenarios are all the equivalent of asking me to imagine putting snowman on the surface of the sun; ok I can imagine arranging it for a micro-microsecond, but things are gonna change pretty fast as soon as I ‘let go’. Yet usually the hypothetical implicitly invites us to pretend everything just stays as described.
Contra Caplan, there is nothing meaningful to be learned from peoples’ answers to these hypotheticals – except perhaps that the person answering them is economically ignorant – because any real, informed attempt to take such hypotheticals seriously makes them disintegrate. What is really odd is the spectacle of an economics professor who doesn’t understand that, or pretends not to for some obscure didactic reason.