"All things are wearisome, more than one can say." - Ecclesiastes 1:8

Wednesday, December 02, 2009

Notes and Queries

Guardian readers will be aware that this is a regular feature in the paper that is designed to answer questions for people too lazy to do their own research. I like this and have decided to branch out on my own in this vein. The first question, prompted by a comment left by Paul Evans under the post below is: demand-revealing referendums - what the fuck are they all about, then?

Actually, I have a more specific question, which I'll come to in due course... Having trawled the tinternet and read the infuriatingly other-worldly explanations of various economists, I've decided that Mr Dillow's advocacy of this idea has at least the benefit of using real world examples - such as Trident, the EU, and the most recent case of Swiss minarets.

I get the basic concept - that people would be obliged to attach a price to their preferences, which in turn would require them to consider more carefully the whole cost-benefits thing. Now, while I'm sure this has been dealt with in some opening paragraph in some gripping text on this issue, in everything I've read on the subject so far, there isn't an answer to this question: why should people have to attach a price, and indeed run the risk of paying a tax, for a policy that is either free or carries a per capita cost that is completely insignificant? This, surely, creates a situation where there is absolutely no connection between what people pay in tax and what the policy they voted for costs in the real world? How is this more 'rational' than the present situation where there is at least a vague link between what they vote for and what they pay? I can't see it in the most recent example Chris uses:
"If people had to stake their own money - even though the risk of loss is actually small - they would be less ready to vote to reduce others’ liberty. They’d figure: a minaret does me no harm, so why should I pay to stop them being built?
But stopping them being built probably won't cost anything at all in the real world. There's a theoretical possibility that a group might try to throw up a minaret in defiance of the law, in which case there would be a cost in terms of policing. But this is unlikely in the extreme, which leaves me repeating the question: how can a mechanism that invites - nay, compels - people to attach a price to something that costs precisely nothing more 'rational' than the present reality?

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