How to make expensive things cheap

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How to make expensive things cheap

Postby Venture » Sun Jan 06, 2019 3:08 am

How do we make expensive things cheaper, in turn increasing the general utility for populations?

E.g. lowering the cost of medicine, house ownership and rent, climate friendly production machinery and vehicles, large capacity buildings and humanitarian service, nuclear energy for space ships, water purifying nanotech, basic social psychotherapy, etc.
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Re: How to make expensive things cheap

Postby Mr Reasonable » Sun Jan 06, 2019 9:56 am

Figure out a way to limit profit taking, or use more child/slave labor.
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Re: How to make expensive things cheap

Postby Carleas » Sun Jan 06, 2019 6:32 pm

If the goal is to increase utility, slave labor probably won't help on net, given the disutility for the slave.

To the original question, removing barriers to trade is a big one, global trade has tons of positive spillovers, not least by significantly decreasing the price of consumer goods. Eliminating domestic subsidies would probably also help, by increasing competition and displacing expensive domestic production in favor of cheaper production abroad (not to mention reducing government spending accordingly, which could in theory be paired with a reduction in taxes).

More generally, pruning regulation is probably a good idea. Compliance costs are significant in themselves, and they also prevent new entrants into markets who we would expect to increase efficiency.

I'm ambivalent on limiting profit-taking. If profits are earned (e.g. a fixed percentage of the consumer surplus), then it would be harmful to limit profits. Moreover, if profits encourage entry and innovation, then there may be benefits to even very high profits if they result in a net increase in consumer surplus. On the other hand, some profits are just rents seeking, and discouraging those can both lower prices and encourage people to seek profits in more socially beneficial areas.

EDIT: words.
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Re: How to make expensive things cheap

Postby Venture » Mon Jan 07, 2019 9:03 pm

I really like the contributions here so far.

I don't like the idea of limiting profit taking, but the management of profit spending is definitely a main concern. Managing profits doesn't necessarily mean reducing the profit margins, as I am insinuating a more efficient reinvestments into production, rather than taking away more from those make decisions for production.

To increase trade and competition, wouldn't we be sacrificing quality?

To what extent does the cost of labor affect the quality of the final product and the net profit spending?

I don't like compliance costs and high taxes, the latter has historically hurt more than the former. I think the increase in utility would increase the demand, but utility is perceived and therefore a choice produced by group psychology. Unfortunately, I don't think education and the morality of the general public is good enough for people to willfully choose to spend money on utility and quality where quality and utility is overdue.

Do we get what we pay for? Or do we moreso pay for what we want? The utility, quality, and morality behind the spending isn't stopping people's wants from spending on things that are already inflated, causing the things that need a price drop never seeing one.
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Re: How to make expensive things cheap

Postby Mr Reasonable » Tue Jan 08, 2019 8:38 am

Increasing trade is code for more child labor.
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Re: How to make expensive things cheap

Postby Carleas » Tue Jan 08, 2019 6:41 pm

Trade and competition don't necessarily mean a decrease in quality, and where they do, it may be that consumers just prefer lower prices to higher quality.

I agree that taxes can be bad and decrease net utility, but redistribution is also utility enhancing (at least, before we account for the overhead of accomplishing it). Reallocating taxes to more efficient forms may be a free lunch, i.e. improving economic outcomes without pulling out more money. VAT, land value tax, and carbon taxes are likely better ways of collecting taxes that could fund redistributive spending at current levels with lower overhead and better aligned incentives.
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Re: How to make expensive things cheap

Postby Venture » Fri Jan 11, 2019 2:47 am

Carleas wrote:Trade and competition don't necessarily mean a decrease in quality, and where they do, it may be that consumers just prefer lower prices to higher quality.

I agree that taxes can be bad and decrease net utility, but redistribution is also utility enhancing (at least, before we account for the overhead of accomplishing it). Reallocating taxes to more efficient forms may be a free lunch, i.e. improving economic outcomes without pulling out more money. VAT, land value tax, and carbon taxes are likely better ways of collecting taxes that could fund redistributive spending at current levels with lower overhead and better aligned incentives.


"Consumers prefer lower prices to higher quality"

Here we go, the natural cycle and golden ratio of the market cycles of excess and inadequacy, the assumption that we will be better off managing markets by a majority that spend and lend more than expected for future value and effects on the markets over time. Spending and lending, unregulated, is harmful in some cases.

How can we measure the effectiveness of redistribution of spending and the moral standards of how long term the balance applies to? I agree that trade and competition increase utility but not necessarily the redistributive properties and methods of measurement of profits, that is the best and equal to all. The value of spending is what the real issue is, how an average person invests in themselves and others.

Is the argument that utility is the foremost catalyst for making expensive things cheap?
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Re: How to make expensive things cheap

Postby Mowk » Fri Jan 11, 2019 7:21 am

Raw material + human time.

If you wish to make things with lesser cost as a monetary expression, question the value of human time and how it is manipulated. The raw materials don't really "cost" us anything to acquire but human time. Who are we paying for them? So we are sort of left with the equation human time plus human time as an exponent = cost, relative to amount of compensation required, which is pretty much what determines what things cost. I can't think of an actual monetary cost to any resource we have available on the planet if you are thinking monetarily.

I came along after a lot of this shit was in place. It existed before me and as result of cause and effect I can have no responsibility for the creation of it, I didn't make it. it is not mine. Question those that feel a life style is their right over others. I am not even responsible for what ever I am, I am not an I, we are a we. Millions of bacteria keep me alive, allow for the digestion of food. It's a group effort. "WE" should start working together, it makes no sense for a brain to think it better then an asshole, when every one of them has the other. We made this. It didn't happen on it's own.

What is time worth? Some people actually think time is theirs to sell.

I've ranted enough, still trying to figure where that came from.

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