Tuesday, March 1, 2011

We Are Not Running Out Of Natural Resources: Video By Prof. Steve Horwitz

Excellent economics video on why we are not running out of natural resources by St. Lawrence University economics professor Steve Horwitz. He is the Charles A. Dana Professor and Chair of the
Department of Economics. Well worth the 4 minutes.

I also suggest you take a look at his working paper, "Wal-Mart to the Rescue: Private Enterprise’s Response to Hurricane Katrina." From the abstract:
The failures of FEMA and other government agencies during Hurricane Katrina have been widely acknowledged in both the popular press and academic literature. However, much less attention has been paid to the successful private sector response during the storm and its aftermath. Wal-Mart and other private retailers played an extraordinarily effective role in the disaster relief process. This paper describes aspects of Wal-Mart’s emergency response system and details their actions during the storm. I argue that WalMart’s successful response was a product of the incentives, knowledge, and superior organizational routines that emerge through private ownership and competitive markets. Because their effectiveness is a function of that institutional context, policy makers should be wary of trying to import or imitate Wal-Mart’s practices in the very different institutional context of the public sector, or assuming that better management, more concern, or additional resources will improve the performance of government agencies. [emphasis added]
Read the complete paper here.

Private markets with unencumbered price signals and investment returns work so much better than government intervention, there is no contest.

1 comment :

  1. Wow, two examples of commodities that are now used more efficiently. So what? Efficiency does not equal effectiveness. What about the LIFE SUSTAINING RESOURCES, such as food, forests, water, fisheries and farm land that are all in decline? Do a video on the current conditions of the resources that support human life, not your wallet. "Efficiencies" in economics when it comes to the most important resources yield business models that reward inefficiencies that sacrifice long term sustainability for short term profits. If that wasn't true, then companies wouldn't be dumping their toxic garbage in the ocean, polluting our air, and clearing out rainforests for fuel and palm oil.