Naked Economics: Undressing the Dismal Science pdfdrive com

Will we have strip malls in 2050? Nothing says that we must accept what the
market tosses us. New York Times columnist Anthony Lewis paid homage to the
beauty of Italy’s Tuscany and Umbria regions (“The silvery olive groves, the
fields of sunflowers, the vineyards, the stone houses and barns”) and lamented
that such small farms are not economical in a world of corporate agriculture but
says they should be preserved anyway. He wrote, “Italy is evidence that there is
more to life—a civilized life—than the unregulated competition of the market.
There are values of humanity, culture, beauty, community that may require
deviations from the cold logic of market theory.”
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There is nothing in economics
that says he’s wrong. We may well collectively decide that we would like to

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protect a way of life, or something that is aesthetically pleasing, even if it means
higher taxes, more expensive food, or less economic growth. To an economist,
and to Mr. Lewis, life is about maximizing utility, not income. Sometimes utility
means preserving an olive grove or an old vineyard—just because we like the
way it looks. As we grow wealthier, we are often more willing to put aesthetics
above the pocketbook. We may invest resources in rural America because it’s
important to our identity as a nation. We may subsidize small farms in Vermont
because they’re beautiful, not because it will make milk cheaper. And so on.
That point comes with several heavy doses of caution. First, we must always
make explicit the costs of fiddling with markets, whatever those costs may be.
How is the outcome different than it would have been, and who pays? Second,
we should take care that these costs fall most heavily on those who enjoy the
benefits. Last and most important, we should make sure that one group (such as
those of us who think that strip malls are hideously ugly) does not use the
political and regulatory process to impose its aesthetic preferences on another
group (those who own strip malls and the people who enjoy the cheap and
convenient shopping there). That said, there is nothing to stop us from dreaming
of a world without strip malls.