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The Economics of Sawdust
I was in Vermont over the weekend and talking to a dairy farmer about the rising price of milk. I was surprised when she said that higher sawdust prices was one of the causes. Sawdust? Sawdust, it turns out, is used for bedding the cows and the price of dust has doubled in the past year. I surmise that the downturn in housing construction has meant a reduced demand for lumber and thus less sawdust.
The connection between the housing market and the milk market is an interesting example of the dense connectedness of markets, "general equilibrium" in the language of economics.
The economics of sawdust also reminds us that the capitalist production system minimizes waste - entrepreneurs search out ways to extract the most value from every input and from every output. Thus even sawdust, as trivial a waste product as one could imagine, is turned into an input into milk production as well as into particle board, fuel nuggets, mulch and other useful products.
Addendum: The WSJ has more on sawdust.
Posted by Alex Tabarrok on June 2, 2008 at 07:57 AM in Economics | Permalink
Comments
Similarly, I remember a news segment on the shortage of corn cobs a while back (yes, the cob minus the kernels). I suppose as demand for ethanol booms we'll have a corn cob surplus. Maybe it's really the corn cob lobby driving that.
Posted by: Andrew at Jun 2, 2008 8:11:25 AM
When I was a kid in the hills of Kentucky we always kept a supply of two types of corn cobs in the outhouse.
You would wipe first with a red corn cob.
Next, you would use a white corn cob to see if you needed to use a second red cob.
Posted by: spencer at Jun 2, 2008 8:22:09 AM
I remember once learning that Henry Ford used the wood from crates that held engines shipped to him, as floorboard materials for his early cars. I can't vouch for the veracity of the tale, but it was told to me in high school. ;-)
Posted by: Speedmaster at Jun 2, 2008 8:46:14 AM
>the capitalist production system minimizes waste
Are you deliberately being facetious here? If it's cheaper to dump the waste rather than use it for production of something else, then dump it is, to which fact the seas of plastic rubbish floating in the Pacific bear abundant witness. Of course, one could argue that *this* plastic is *not* the waste of the production system, but there are plenty of other examples.
Posted by: A Tykhyy at Jun 2, 2008 8:49:13 AM
The capitalist system minimizes waste...when it is "worth" it to do so. But wasteful, extravagent packaging is sometimes also "worth" it, if poeple are willing to pay for such waste.
Posted by: RCinProv at Jun 2, 2008 9:16:57 AM
Oh please -
'The economics of sawdust also reminds us that the capitalist production system minimizes waste ...'
In Germany, at least at the few Black Forest farmhouses I'm familiar with, the fact that cows are kept in a manner that is less profit maximizing than theoretically possible in the U.S. (no hormones, no antibiotics to enhance growth, grass fed from the fields surrounding the farmhouse, etc.) reduces the amount of waste in sawdust - because sawdust is far too valuable as material to create wood based materials to simply throw on the ground. Currently, milk costs around 61 euro cents a liter, including 7% VAT, by the way, which seems to be less than the American price.
*Side note - German dairy farmers are striking (not delivering milk, which isn't as difficult as it would be for an industrial American dairy farmer's operation), demanding a higher price to cover their costs, even though they don't use sawdust. There is some speculation that the price of milk was artificially lowered at the creamery/dairy (which has a monopoly on buying the farmers' milk production) to help the inflation numbers, as it went from 73 euro cents to 61 cents in the space of a few days.
To stray a bit from American milk production as an example of how waste is squeezed out by '...entrepreneurs search[ing] out ways to extract the most value from every input and from every output,' let us use the example of returnable bottles in Germany, including milk bottles. Such containers create less 'waste,' and reduce demand for throw away containers. Which means that returnable bottles are a problem in a system geared to maximizing production of containers, as is normal in American consumer goods production.
Capitalism, especially as practiced in the U.S., is essentially a positive feedback machine, one where the people running the system often actively deny the existence of any externalities which could detract from their pursuit of profit in the present. A machine which runs until the inevitable occurs.
Any competent engineer is able to point out this particular flaw of positive feedback systems over the long term. A certain Disney cartoon comes to mind, for the slower among us.
It is a bizarre sort of blindness which believes that other societies, facing resource constraints for generations, do not operate as efficiently as possible, regardless of their putative economic structure. German farmers, to use a concrete example, have a centuries old reputation for both long term and high productivity - in whatever economic system they worked under. A reputation which extends to both North and South America, especially when looking at Amish and Mennonite communities, whose farming practices generally tend to encompass the sort of productivity which shows how wasteful modern American capitalism is, shipping tons of sawdust just so cows can be maintained in an unnatural manner, while generating enough milk in the short term to make the entire process profitable.
Maybe by an American definition of 'profitable,' but in the eyes of many, that definition is often translated into 'take the money and run.' Which is seen as a pretty stupid way to do business over the longer term, in major part because of the large amounts of waste it actually generates.
Posted by: rent_to_own at Jun 2, 2008 9:17:39 AM
Is there no substitute bedding for cows? And also, has the price of lumber risen? Besides the downturn in construction, I would think higher wood prices would increase the price of dust.
Posted by: John Ur at Jun 2, 2008 9:19:42 AM
A Tykhyy: "Are you deliberately being facetious here? If it's cheaper to dump the waste rather than use it for production of something else, then dump it is"
RCinProv: "The capitalist system minimizes waste...when it is "worth" it to do so. But wasteful, extravagent packaging is sometimes also "worth" it, if poeple are willing to pay for such waste."
The statement:
"The capitalist system minimizes waste"
does not say that all waste is eliminated, does it? If you folks are arguing that this statement is not true, do you have any evidence that a socialist system produces less waste?
As I see it, it is the incentive of profits that drives our economy to utilize every possible portion of the resources we consume. Do you folks have a different take on the functioning of a capitalist system?
Posted by: John Dewey at Jun 2, 2008 9:48:21 AM
They should use cow waterbeds
Posted by: David Zetland at Jun 2, 2008 9:53:17 AM
It is possibly as true to say that "the capitalist production system minimizes waste" as it is to say that "the capitalist consumption system maximizes waste". A capitalist is just as keen to reduce costs as she is to increase sales, which very often means convincing the consumer to buy something she either doesn't really need or already has.
Posted by: Shunyata Kharg at Jun 2, 2008 9:57:21 AM
Did this rugged individualist also tell you that he has little to worry about because the dairy industry in New England is a legal cartel with milk prices set by the New England Dairy Compact?
Posted by: Brutus at Jun 2, 2008 10:01:23 AM
rent_to_own: "It is a bizarre sort of blindness which believes that other societies, facing resource constraints for generations, do not operate as efficiently as possible, regardless of their putative economic structure"
I don't think it is blindness to observe that both the Soviet Union and China did not operate as efficiently as possible when their peoples were constrained by central planners. I don't think it is blindness to observe that capitalist South Korea is many more times productive than centrally planned North Korea, despite the abundance of natural resources available in the latter.
IMO, it is blindness to ignore the economic results of capitalism and socialism in the 20th century, and then argue that people will be equally productive under any system.
For some reason, you have provided arguments about the productivity of Germany. I don't think Alex was arguing that American capitalists more productive than German capitalists, was he? My guess is that the U.S. has a larger reservoir of unskilled workers - we share a 2,000 mile border with a third world nation - and we thus do not have as many incentives as German capitalists to increase productivity.
Another reason for differences in productivity between Germany and the U.S. is that German women with pre-school children do not participate in the paid workforce. In the U.S., much of the traditional low-skilled work of housewives - food preparation, child raising, house-cleaning - is included in national productivity statistics. I do not think that is the case in Germany.
Posted by: John Dewey at Jun 2, 2008 10:26:50 AM
"the capitalist production system minimizes waste"
Flame-bait?
What a ridiculous overgeneralization from an otherwise interesting story.
Posted by: paul at Jun 2, 2008 10:27:48 AM
If the WSJ is right, and they need to ship it that far, then it is most probably the cost of diesel that is effecting the cost of sawdust. For those bulk items, transportation is the highest cost input involved.
Over the last three years gravel went from $12/ton to $20/ton and back down to $14/ton. All based on fuel prices.
Posted by: Tom at Jun 2, 2008 10:34:23 AM
Shunyata Kharg: "which very often means convincing the consumer to buy something she either doesn't really need or already has."
How do you determine that a consumer ever buys something she doesn't really need? Obviously, if the consumer paid for an item, she did so because she believes the item is meeting some need. Do you mean that consumers buy items which you don't believe they need? Do you believe that central planners and not consumers should determine which items are "really needed"? Do you believe that comsumers are just stupid and need to be protected by dictators?
In 57 years of living in the U.S., I never remember our supermarkets not having such essentials as meat or toilet paper. Can the same be said of centrally planned economies? The 20th century evidence is very clear. Capitalism meets the needs of its people very well. Socialism cannot.
Posted by: John Dewey at Jun 2, 2008 10:44:35 AM
Capitalism, especially as practiced in the U.S., is essentially a positive feedback machine, one where the people running the system often actively deny the existence of any externalities which could detract from their pursuit of profit in the present.
Can you please name the economic system and the country under which people never denied the existance of any externalities which could detract from their pursuit of profit in the present?
I also note some inherent negative feedback in capitalism. If you are producing waste, then it is going somewhere. Unless you can disperse it into the air, it will enter the water or the ground. If all of the ground and water is owned by someone or a small group of someones, those people will eventually notice and start complaining, and taking you to court. If the water and the ground is "owned" by everyone, then the gains to any one person from complaining or suing are minimal, so far less complaints happen and they are pursued less energetically.
Air and ocean pollution is another problem of course, as divvying up oxygen and the oceans into private ownership is implausible, but that's a problem for all economic systems, not just capitalism.
Capitalism of course fails compared with a fantasy utopian economic system by which we just assume that none of the bad stuff happens, but when it comes to environmental problems capitalism looks pretty darn good compared to every other real-world system that has been tried.
Posted by: Tracy W at Jun 2, 2008 10:44:37 AM
At least in Europe, timber mills have started to burn saw dust as fuel in order to help dry the lumber. As price of other sources of energy goes up, this option becomes more and more attractive.
In addition, as Tom points out, the transportation costs to get the saw dust to the farmers are also increasing.
Posted by: Johan at Jun 2, 2008 10:53:59 AM
Tom says:
Over the last three years gravel went from $12/ton to $20/ton and back down to $14/ton. All based on fuel prices.
I remember fuel prices doubling, but I sure do not remember them falling by a third.
What did I miss?
Posted by: spencer at Jun 2, 2008 11:09:41 AM
Dear Alex,
The other thing to note, since this is an economics blog, is that beyond the normative issue of waste, is the positive issue: this is a classic joint-supply, mutton-and-wool problem. The demand for one of the items jointly supplied falls and, therefore, the price of the other item rises. If any of you read the Marshall Jevons novels, you'll recall that understanding joint supply is one of the keys to spotting the villain in one of the novels.
Best,
David
Posted by: David R. Henderson at Jun 2, 2008 11:11:22 AM
I wonder in shredded paper would due as a substitute.
Posted by: Floccina at Jun 2, 2008 11:47:59 AM
Careful, the word "waste" is one of the holy words for the anti-capitalist watermelon crowd.
Posted by: Nunca at Jun 2, 2008 11:57:35 AM
Interesting example of joint-supply, as David points out, but I thought the classic example was steel and copperas? The latter, commonly known as iron sulphate, is extremely useful for all kinds of chemical manufacturing, but would be uneconomical to produce directly instead of as the by-product of other industrial processes.
In any case, it's a shame that many of the commenters here insist on a subjectivist definition of "waste" as a counter to your correct assertion about capitalism being a powerful force in minimizing it. For instance:
"extravagent packaging is sometimes also 'worth' it, if poeple are willing to pay for such waste."
Waldo, if people are willing to pay for it, that's prima facie evidence that it's "worth" it. Unless you don't buy into economics. In which case you're on the wrong blog.
Posted by: M. Hodak at Jun 2, 2008 12:12:07 PM
First, assume a can opener -- I mean, assume no waste. You are so lost in your assumptions that, by definition, there is no waste. Ok, fine, but please don't pretend you have "proven" anything other than your assumptions! People are willing to do all kinds of wasteful things when they don't have to pay the true cost. I gather that if one finds externalities to be a problem, you think they are reading the "wrong blog."
Posted by: RCinProv at Jun 2, 2008 12:29:03 PM
John Dewey: In 57 years of living in the U.S., I never remember our supermarkets not having such essentials as meat or toilet paper. Can the same be said of centrally planned economies? The 20th century evidence is very clear. Capitalism meets the needs of its people very well. Socialism cannot.
I'm not trying to defend any particular "socio-economic" system, I am simply pointing out that without a continuous supply of demand in the form consumer "needs" then capitalism would quickly grind to a halt. I guess it depends on how many things one considers a person needs to survive. I think it is becoming quite clear that the planet itself cannot afford to maintain its entire population at the material level of those who live in "developed" countries and in that sense alone Capitalism is not beyond criticism (as no system is).
Posted by: Shunyata Kharg at Jun 2, 2008 1:06:31 PM
Shunyata Kharg: "I am simply pointing out that without a continuous supply of demand in the form consumer "needs" then capitalism would quickly grind to a halt."
Sorry, but I don't understand this statement at all. If demand for goods and services did not exist, why would any economic system exist in the first place. What point are you trying to make? Do you believe that capitalism can only survive if demand for goods and services grows? Why would you think that? Further, you seem to be focusing on material goods. Capitalism is not just an economic organization of material goods.
Shunyata Kharg: " I think it is becoming quite clear that the planet itself cannot afford to maintain its entire population at the material level of those who live in "developed" countries"
That is certainly not clear to me. If you had written:
"the planet does not have sufficient fossil fuels to maintain the population at the level of developed countries using existing technology"
perhaps I could agree. But why would anyone believe that alternatives to fossil fuels will not be available? Why would anyone believe that the resource-efficiency of current technology will not be improved? Why are you so pessimisstic about the ability of the human race to continue improving its standard of living, just as it has done for many centuries?
Posted by: John Dewey at Jun 2, 2008 1:36:43 PM
and how could sawdust account for a significant fraction of the production cost of milk?! really, even if it accounted for 10% of the cost, which i think is an outrageously high fraction, a doubling of the price of sawdust would increase the price of milk by 10%. This cannot account for most of the increase in milk prices.
Posted by: samson at Jun 2, 2008 1:47:20 PM
If you're using sawdust as bedding, I can only conclude that you must be short of bracken and heather.
Posted by: dearieme at Jun 2, 2008 2:35:03 PM
"I gather that if one finds externalities to be a problem, you think they are reading the 'wrong blog.'"
In discussing economics, if that's what you're commenting on, you shouldn't confuse features and externalities.
What people are willing to supply and others are willing to pay for are features. Externalities are the costs that a transacting pair impose on a third party. Where is the offended third party in your example? You, because you don't like "extravagant packaging?" That's not a economic consideration, it's a personal, or perhaps political, preference.
You might go off the reservation and assert that you're bearing the cost of the waste created by extravagant packaging, but such an assertion, even if it came with proof, doesn't bear on the point of this post, which is that not all externalities are negative if one can re-route "waste" to productive use.
Alex's ancillary point, the one about markets rewarding the minimizing of waste, is simply the economic obverse of his main point. The evidence for this is so abundant that I didn't get why anyone would be astonished about it. Chemical plants use their chemical inputs far more efficiently than they used to, and they market their residual products far more effectively (i.e., profitably) than they used to. Auto plants use their inputs--steel, rubber, etc.--far more efficiently than they used to, and they profit from their residuals (scrap, etc.) far more than they used to. Pick an industry. These effects are a natural effect of market forces. What's the controversy?
Posted by: M. Hodak at Jun 2, 2008 4:07:15 PM
In Euorope many homes are heated by heat from electricity or other industrial production that would otherwise go to waste. Central planning minimizes waste.
Posted by: sort_of_knowledgeable at Jun 2, 2008 4:45:49 PM
In Europe many homes are heated by heat from electricity or other industrial production that would otherwise go to waste. Central planning minimizes waste.
Maybe that wastes more human effort and ingenuity. Maybe it is a waste because people would prefer to live further apart and get heat otherwise. So maybe it is not waste but consumption. Not easy to say.
Posted by: Floccina at Jun 2, 2008 6:17:18 PM
I guess it depends on how many things one considers a person needs to survive.
Why would anyone merely want to survive who had the option of doing more with their life? In what country and in what time period do people have no aspirations beyond mere survival? Throughout human history people have done more than merely survive, and indeed throughout pre-history. We know from archeology that people made beautiful objects and decorated jewellery, pots, etc. Pre-historic people (in the sense of before written history) constructed massive monuments like Stonehenge or the statues on Easter Island. All around the world people do more with their lives than merely survive.
I think it is becoming quite clear that the planet itself cannot afford to maintain its entire population at the material level of those who live in "developed" countries and in that sense alone Capitalism is not beyond criticism (as no system is).
But when you criticise capitalism, it's much more informative if you compare it to some other real system, or at least a specific theoretical system, not some mysterious utopia in which all the problems that plague real world economic systems are just assumed not to exist.
In Euorope many homes are heated by heat from electricity or other industrial production that would otherwise go to waste. Central planning minimizes waste.
In the USA many factories use a generator to produce both heat and electricity, both of which are used within the factory.
The use of heat from power plants versus the use of individual boilers for heating houses depends on the relative efficiency of moving gas to people's homes and then producing heat versus producing heat and then moving it to people's homes. Which is more efficient depends on matters like population density and where the power plants are built. I have not seen any calculation of which is more efficient overall.
Posted by: Tracy W at Jun 3, 2008 3:55:57 AM
Tracy W: Why would anyone merely want to survive who had the option of doing more with their life?
One thing is physical survival (shelter, food, warmth etc.) and another thing is "spiritual" advancement. What you refer to falls into the latter category, in my opinion. Of course, "spiritual" advancement may use material objects, but doesn't necessarily do so.
Tracy W: But when you criticise capitalism, it's much more informative if you compare it to some other real system, or at least a specific theoretical system, not some mysterious utopia in which all the problems that plague real world economic systems are just assumed not to exist.
Criticism is not a necessarily a comparative exercise. If it were no new systems, be they economic or explicative physical theories, could be constructed. Criticism should never be bound by axiomatic dictums, such as only being valid in a comparative context. Nothing is beyond criticism.
Posted by: Shunyata Kharg at Jun 3, 2008 5:11:34 AM
What you refer to falls into the latter category, in my opinion. Of course, "spiritual" advancement may use material objects, but doesn't necessarily do so.
I'm not sure what your point is. Do you agree that as far as we know everyone wants to do more than merely survive?
And do you agree that as far as we know, every culture everywhere and at every time has used physical resources for purposes other than those that are necessary for pure physical survival?
I don't think it's very relevant to the argument to say that resources are being used for spiritual advancement rather than physical survival. There are plenty of people in this capitalist society selling resources on the basis that they will assist in spiritual advancement - visit your local New Age shop if you doubt me.
Criticism is not a necessarily a comparative exercise. If it were no new systems, be they economic or explicative physical theories, could be constructed. Criticism should never be bound by axiomatic dictums, such as only being valid in a comparative context. Nothing is beyond criticism.
I didn't say that it was impossible to criticise without offering an alternative. I said it was not informative. I don't see much value in saying that capitalism isn't perfect - any idiot can say that regardless of whether it is true or not. It's much more interesting if you say that "capitalism is worse than communism" or "capitalism is worse than anarchism", or "in the modern USA we have this feature, while feudal societies got along perfectly well without it". Then we can have a decent argument. "Rent to Own"'s criticism would have been far more informative if they had provided an example of a country or a realisable system that they claimed did not display those features.
And I note that if nothing is beyond criticism, then criticism itself is not beyond criticism.
Posted by: Tracy W at Jun 3, 2008 7:14:40 AM
Tracy W: And do you agree that as far as we know, every culture everywhere and at every time has used physical resources for purposes other than those that are necessary for pure physical survival?
When I said "spiritual" advancement I basically meant human activities above and beyond purely physical survival.
Tracy W: Then we can have a decent argument.
I don't want an argument. I can barely see the point of a conversation when one side tries to dictate the terms of communication.
Tracy W: And I note that if nothing is beyond criticism, then criticism itself is not beyond criticism.
Absolutely!
Posted by: Shunyata Kharg at Jun 3, 2008 8:39:48 AM
Spencer:"I remember fuel prices doubling, but I sure do not remember them falling by a third.
What did I miss?"
http://tonto.eia.doe.gov/oog/info/wohdp/diesel.asp
Diesel went from 3.05 to 2.40 the last half of 2006.
Down 20%. It was obviously not the only factor, but probably the dominant.
Posted by: Tom at Jun 3, 2008 10:00:26 AM
When I said "spiritual" advancement I basically meant human activities above and beyond purely physical survival.
So we are agreed then. Every society, capitalist or not, does things for purposes other than merely physical survival.
I don't want an argument.
You are welcome to avoid an argument at any moment by agreeing with me. Personally I like arguments. They are a far better way of sharpening our thinking than mindless discussion.
I can barely see the point of a conversation when one side tries to dictate the terms of communication.
Well, the fun thing is that when one side tries to dictate the terms of communication, for example by saying Criticism should never be bound by axiomatic dictums, such as only being valid in a comparative context., then you can argue back, and criticise their attempts to dictate the terms of communication.
Attempting to dictate the terms of communication on the Internet are normally not very useful (assuming we are talking about this meta-level, as opposed to machine-level communications in which case clear communication protoculs are absolutely necessary). You can make grand statements about criticism, but that does not bind me in any way, and vice-versa.
Incidentally, what response do you think is appropriate to things like Rent To Own's statement about positive feedback?
Posted by: Tracy W at Jun 3, 2008 11:22:26 AM
Tracy W: So we are agreed then. Every society, capitalist or not, does things for purposes other than merely physical survival.
The point is that physical survival necessarily entails a fundamental requirement of material goods, whereas what I described as "spiritual" advancement does not. Material goods are not a fundamental requirement for activities over and beyond physical survival.
Tracy W: Well, the fun thing is that when one side tries to dictate the terms of communication, for example by saying Criticism should never be bound by axiomatic dictums, such as only being valid in a comparative context., then you can argue back, and criticise their attempts to dictate the terms of communication.
So you see me as dictating the limits of conversation when I was trying to remove other bounds you had imposed on words I had used. Imagine somebody said to you, "all limits have been removed"; would you then complain about these (now non-existant) limits restricting you?
Tracy W: You can make grand statements about criticism, but that does not bind me in any way, and vice-versa.
I have no intention of either binding you or myself to anything.
Tracy W: Incidentally, what response do you think is appropriate to things like Rent To Own's statement about positive feedback?
From my experience it is clear that when one focusses on something in a concentrated manner, one loses some of one's peripheral vision.
Posted by: Shunyata Kharg at Jun 3, 2008 11:43:47 AM
Loud applause for Shunyata Kharg! Good show.
Tracy W. -- you might enjoy a wrestle with this passage from Michael Oakeshott extolling "conversation" (as opposed to debate).
But this may be temperamental. Personally I have no idea 90% of the time why anyone would opt for debate (ie., combat) over conversation (ie., hanging out together comparing notes).
Posted by: Michael Blowhard at Jun 3, 2008 1:29:39 PM
The point is that physical survival necessarily entails a fundamental requirement of material goods, whereas what I described as "spiritual" advancement does not. Material goods are not a fundamental requirement for activities over and beyond physical survival.
That's your point. My point is that every society that we know about, capitalist or not, uses goods for reasons other than mere survival. It is not necessary for physical survival to decorate pots, to decorate clothes, to bury physical items with the dead, to paint cave walls, to build massive stone monuments (Stonehenge, the pyramids, the Easter Island statues), etc. Yet every society we know of does things like this. Therefore using material goods for things other than physical survival is a feature of humanity as a whole, not of capitalism in particular.
So you see me as dictating the limits of conversation when I was trying to remove other bounds you had imposed on words I had used.
No. I saw you as *trying* to dictate the limits of conversation. As I stated above, attempts by one side in an Internet debate to dictate the terms on which communication can take place are rather ineffectual, so I don't see you as dictating.
I don't know what you mean about me imposing bounds on words you had used. How can I impose bounds on the words you use? I don't even know where you live, so I can't have been coming by your house and threatening you if you use them in ways I disapprove of (and if I did, you could call the police). If you think I have imposed bounds on the words you use, surely the simplest thing is just to ignore those bounds? Don't try, just do!
I have been repeatedly saying that criticising capitalism without proposing an alternative is not informative. You haven't engaged in this debate at all, instead you've gone off on this tangent about everything being open to criticism, and your idea that I have mysteriously managed to impose bounds on the words that you use. You haven't said anything that would convince me that criticising capitalism without proposing an alternative is actually informative.
Posted by: Tracy W at Jun 4, 2008 4:27:12 AM
But this may be temperamental. Personally I have no idea 90% of the time why anyone would opt for debate (ie., combat) over conversation (ie., hanging out together comparing notes).
Because it's fun. The way competitive sports are fun, including the martial arts. Hanging out together comparing notes doesn't get the adrenaline going. As you say, this is probably temperamental.
What always amuses me is people who say they don't want to argue, but then keep doing so. I think what they really want is the pleasure of the last word without all the bother of constructing decent arguments. But I may be wrong.
Posted by: Tracy W at Jun 4, 2008 4:40:01 AM
In Europe many homes are heated by heat from electricity or other industrial production that would otherwise go to waste. Central planning minimizes waste.
If it's economic to minimize waste, then somebody will start a company to do it, even if that means coordinating the output of multiple industries. On the other hand, if it's wasteful to minimize waste, then in capitalist society you will have waste; just less of it. If you centrally plan, then you don't have prices, which means that you'll never know whether it's more wasteful to waste or more wasteful to reuse. Which is exactly Alex's point.
Posted by: Russ Nelson at Jun 4, 2008 10:07:27 PM
I think you should look for a price explanation in supply and demand rather than costs. Dairy prices have rocketed around the world in the last few years, and town milk (which is not exportable) must also be affected. I'm posting from New Zealand, occasionally referred to as the "Saudi Arabia of milk"
Posted by: Owen at Jun 11, 2008 5:13:59 AM
