The economic thinking behind "buy local" campaigns is typically terrible. One such example is the claim that a dollar "circulates more" when you spend it locally. The rate of circulation of a dollar doesn't create any wealth. Try it out: circulate a dollar among a group of friends and feel your standard of living stay … Continue reading What “Buy Local” Campaigns Get Wrong
Factor price equalization due to trade and investment flows across economies would substantially reduce economic reasons for immigration to rich countries. (Trade and investment flows will not eliminate economic reasons for migration because if polities differ in total factor productivity due to political institutions, there can still be an advantage to migrating to a more … Continue reading Trade or Migrate?
All 50 states ban the direct sales of motor vehicles from manufacturers to consumers. The politics of this regrettable policy are clear: auto dealers are powerful political players in every state, while only a few states actually have manufacturing facilities. Banning direct manufacturer sales benefits dealers while hurting manufacturers and consumers. State governments continue to … Continue reading Interstate Protectionism and the Dormant Commerce Clause
I am currently blogging from Roatán, Honduras, where I am participating in the "Future of Free Cities" conference, sponsored by Universidad Francisco Marroquín. The conference is about the economic and political preconditions for the establishment of free-enterprise zones in developing countries, as well as the internal governance of these territories. In his opening talk last … Continue reading The Future of Free Cities, Part 1
A couple of weeks ago, one of the NZ student delegates to the US NZ Future Partners Forum popped in asking about the Trans Pacific Partnership. Since he offered me a decent beer, I was happy to have a chat. In 2005, New Zealand joined with Brunei, Singapore and Chile in a free trade zone … Continue reading Free trade for the Pacific