Do we economists repulse you?
Economists are asking the wrong question, Mr. Bloom said at the panel. They assume that “everything is subject to market pricing unless proven otherwise.”
“The problem is not that economists are unreasonable people, it’s that they’re evil people,” he said. “They work in a different moral universe. The burden of proof is on someone who wants to include” a transaction in the marketplace.
Well, that's a bit harsh. In any case, Mr. (Paul) Bloom (a Yale psychologist) is incorrect. It's not that we think that everything is subject to market pricing or that it should be. It's that we think most things are subject to conditions of scarcity: unlimited wants - limited resources. We study human behavior, rational and self-interested human behavior, under conditions of scarcity. We believe that things have costs and that trade-offs exist. The belief in markets is an extension.
When the lack of a market results in lower social welfare, we comment on that. For instance:
You can donate a kidney to prevent a death and be hailed as a hero, but if you take any money for your life-saving offer in the United States, you’ll be jailed.
Some are repulsed at the thought of someone taking cash for a kidney. Yet many no doubt find no problem whatsoever in a medical team receiving payment for surgically implanting a kidney in someone. Why can they receive payment for their services but no-one can receive a legal payment for a kidney?
Moreover, the law against the sale of kidneys, livers, and hearts has created shortages that lead some to their death, some who would gladly have paid for a new organ. Surely that thought is repulsive too.
HT Greg Mankiw
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