The four anti-economic biases

My previous attempt at satire about boycotting Santa was inspired by this article on reason, which excerpts Bryan Caplan's book The Myth of the Rational Voter: Why Democracies Choose Bad Policies. The article talks about how there are four basic biases with which most people are burdened:
  • the anti-market bias - people believe that prices are set by the whims of CEOs rather than by market mechanisms of supply and demand; people don't believe that prices set by the market are fair; people believe that profits are an "unjust reward";
  • the anti-foreign bias - trade between individuals is a non-zero-sum game and is good, trade among towns is a non-zero-sum game and is good, trade among regions is a non-zero-sum game and is good - but trade among countries is a zero-sum game and is dangerous;
  • the make-work bias - people believe that there are a finite amount of "jobs" that need to be "preserved" and "protected"; and
  • the pessimistic bias - people believe that the past used to be better and the future is going to be worse, despite empirical evidence to the contrary.
The Santa article illustrates the make-work bias in particular. If Santa brings us goods for free, everyone benefits; people who are laid off in the toy industry can always find more work elsewhere; the supply of work that can be done is infinite, if only people are left free to find that work.

No one needs to be protected from receiving gifts from Santa, or from getting Chinese goods on the cheap. As long as we can rely on Santa to bring us an annual infusion of free toys, or on the Chinese to keep delivering their goods in exchange for a small quantity of ours, that's great - we can make better use of our workforce in other industries. Like the reason article quotes Steven Landsburg from his book The Armchair Economist:
There are two technologies for producing automobiles in America. One is to manufacture them in Detroit, and the other is to grow them in Iowa. Everybody knows about the first technology; let me tell you about the second. First you plant seeds, which are the raw materials from which automobiles are constructed. You wait a few months until wheat appears. Then you harvest the wheat, load it onto ships, and sail the ships westward into the Pacific Ocean. After a few months, the ships reappear with Toyotas on them.


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