[facetube]

Yes, ignoring all moral and ethical externalities – things that are important to human beings – does indeed make economics easier to fake on the internet. Letting people die in foreseeable fiery crashes, however, is not how an organized civil society deals with product defects that put lives at risk. It is immoral to do so: a concept which actually does exist, no matter how hard you sarcastiquote it.

Your proposed framework would make for a silly Ayn Rand book or two, but little more.

[mmirate]

> things that are important to human beings

If they were important, then there would be economic value to them.

(And to some extent this is in fact the case: even once the de Havilland Comet's metal-fatigue issues were compensated-for and recalls completed, nobody wanted to fly on it, so it became a commercial flop, and now the air-transport leader is Boeing not de Havilland.)

[sincerely]

>If they were important, then there would be economic value to them.

What justifies this statement? It seems nearly mind-bogglingly false to me so I would be interested to hear support for it.

[mmirate]

The interaction between demand and prices is an important part of the intrinsic signaling mechanism that a free market provides.

If there are two alternate (competing) goods, and one is cheaper but the other is "Produced Ethically in Accordance with X Standards", then each person chooses whether that certification - and the qualitative difference it signifies - matters to them enough to pay the difference in price between that product and its cheaper competitor.

Or, to use another example elsewhere in this thread: if someone is in the market for a car, and one of the cars that meets their criteria is the Pinto, then it is up to them to decide whether the reduction-of-risk of fuel combustion justifies buying a more expensive vehicle that isn't a Pinto.

In either case, the macro-level effect will be that some portion of customers will buy the inferior product, and some will buy the superior product, and if there is sufficient disparity in the quantity-demanded, then the suppliers have greater incentive to produce the product with the higher quantity-demanded (but any quantitative mismatch between supply and demand will cause temporary fluctuations which will quickly self-correct, preserving the equilibrium in the long run). Ergo, if a good is superior in some way such that that superiority is "important", then that good will outsell any competition that lacks that quality.

[facetube]

Here comes the "everyone is always a fully-informed consumer" trope. Practically a religion at this point.

How do you think Ford communicated with pre-sale consumers re: their product's inadequately reinforced rear end, insufficient crumple zone, "essentially ornamental" rear bumper, and increased risk of death secondary to fire or combustion? Under your scheme, how do consumers who wish to avoid death by fire learn of these defects? What economic interest does Ford have to disclose the problem if the deaths are cheaper than fixing it?

"In the [Pinto] memo, Ford estimated the cost of fuel system modifications to reduce fire risks in rollover events to be $11 per car across 12.5 million cars and light trucks (all manufacturers), for a total of $137 million. The design changes were estimated to save 180 burn deaths and 180 serious injuries per year, a cost to society of $49.5 million."

[mmirate]

> What economic interest does Ford have to disclose the problem if the deaths are cheaper than fixing it?

If people read the news, some nonzero amount equal to the amount of lost Pinto sales. If the competition has been crash-tested and the Pinto isn't, then Ford was already continually losing money by losing the "non-cheapskate" market segment.

> Under your scheme, how do consumers who wish to avoid death by fire learn of these defects?

Read the news, be mechanical engineers, prefer products that have been given favorable ratings by independent crash-test firms, or start an independent crash-test firm.

(No, I have no idea whether crash-testing was already a thing when the Pinto came out. Regardless, such things are, generally-speaking, how one solves these information problems.)

[facetube]

They didn't need a nonzero amount of loss to motivate correction of their product's problem, they needed more than $123 million. The market did not provide that.

I think we can end this here. The idea that average Americans should "be mechanical engineers" just to not die in a preventable fire is insane and really not worthy of further discussion.

[facetube]

So if there's no economic value attached to something, you consider it unimportant by definition? Wow.

[mmirate]

Well, in these modern times, we call any mechanism which allocates scarce (ergo valuable) resources, an "economy".

Thus, the "economic" in "economic value" is actually redundant.

And if something has no value, to anyone ... what importance could it have?

(except perhaps in the history books, e.g. the now-bloodstained clothes that Archduke Franz Ferdinand of Austria wore when he was assassinated)

This seems rather elementary/tautological/Econ-101 to me.

[facetube]

> This seems rather elementary/tautological/Econ-101 to me

If it does, it's only because you're deliberately engaging in tautology.

Not all human value can be expressed in monetary terms. At a minimum, market forces cannot and will not raise the dead any time soon. In death there is no recourse that will make you whole. No amount of money will restore the value to you. That's why regulation and prevention exists – because the market can't cheat death.