[webmaven]

> The free market is far and away the most efficient way to organize an economy,

By 'free' do you mean unregulated?

And efficiency (which you seem to equate with 'return on capital') isn't the only positive value, nor is efficiency necessarily a good proxy for all other positive values.

In any case, while a theoretical perfect market without any asymmetries might be most efficient, in practice we have markets that are imperfect in many ways that induce market failures, and regulation is needed to compensate and restore market efficiency. The market for labor is no exception, as the asymmetries in labor relations are huge.

[CryptoPunk]

>>And efficiency (which you seem to equate with 'return on capital') isn't the only positive value, nor is efficiency necessarily a good proxy for all other positive values

Efficiency is the only thing that matters. Take two countries: Pragmatia and Utopitia. Pragmatia solely pursues efficiency, in line with its pragmatic ideals, while Utopitia pursues social democratic ideals, in line with its utopianist ideals.

Pragmatia consequently sees GDP grow at an annual rate of 5% a year, while Utopitia sees its GDP grow at 2.5% a year.

From a starting point as equals in 2022, Pragmatia acquires a 3 to 1 per capita GDP advantage over Utopitia within 50 years, providing Pragmatia's residents with a vastly better standard of living than Utopitia's, irrespective of how large of a percentage of the latter's GDP was expropriated by the state for social democratic redistribution.

This was basically the story of Hong Kong vs Mainland China from the 1950s to 1980:

https://www.ted.com/talks/paul_romer_why_the_world_needs_cha...

>>In any case, while a theoretical perfect market without any asymmetries might be most efficient, in practice we have markets that are imperfect in many ways that induce market failures, and regulation is needed to compensate and restore market efficiency.

Imperfect markets don't imply that wages are below what they would be under free market conditions, or that a crude intervention, like granting labor unions with collective bargaining monopolies over companies' hiring practices will counter-act the wage-inhibiting effect of some market inefficiency, let alone do so without introducing far larger and more significant inefficiencies of its own.

Basic supply and demand theory tells us that the employment standard mandates, like minimum wage controls, advocated by unions, to the extent that they have an effect, harm economic efficiency. In the absence of the ability to conduct controlled experiments to prove definitively its effect one way or another, we should opt to trust basic economy theory.

>>The market for labor is no exception, as the asymmetries in labor relations are huge.

Asymmetries are irrelevant. Apple is worth over $2 trillion, yet cannot force me to buy a Macbook Pro. It can only induce me to do so by offering more value than competitors.

If we let Apple and its social justice PR firms convince us that we need the government to control the consumer electronic market, then Apple could, through regulatory barriers, keep competitors out, or through taxation, force us to indirectly buy its products, by funding the state that does.

[CryptoPunk]

>>And efficiency (which you seem to equate with 'return on capital') isn't the only positive value, nor is efficiency necessarily a good proxy for all other positive values

Efficiency is the only thing that matters. Take two countries: Pragmatia and Utopitia. Pragmatia solely pursues efficiency, in line with its pragmatic ideals, while Utopitia pursues social democratic ideals, in line with its utopianist ideals.

Pragmatia consequently sees GDP grow at an annual rate of 5% a year, while Utopitia sees its GDP grow at 2.5% a year.

From a starting point as equals in 2022, Pragmatia acquires a 3 to 1 per capita GDP advantage over Utopitia within 50 years, providing Pragmatia's residents with a vastly better standard of living than Utopitia's, irrespective of how large of a percentage of the latter's GDP was expropriated by the state for social democratic redistribution.

This was basically the story of Hong Kong vs Mainland China from the 1950s to 1980:

https://www.ted.com/talks/paul_romer_why_the_world_needs_cha...

>>In any case, while a theoretical perfect market without any asymmetries might be most efficient, in practice we have markets that are imperfect in many ways that induce market failures, and regulation is needed to compensate and restore market efficiency.

Imperfect markets don't imply that wages are below what they would be under free market conditions, or that a crude intervention, like granting labor unions with collective bargaining monopolies over companies' hiring practices will counter-act the wage-inhibiting effect of some market inefficiency, let alone do so without introducing far larger and more significant inefficiencies of its own.

Basic supply and demand theory tells us that the employment standard mandates, like minimum wage controls, advocated by unions, to the extent that they have an effect, harm economic inefficiency. In the absence of the ability to conduct controlled experiments to prove definitively its effect one way or another, we should opt to trust basic economy theory.

>>The market for labor is no exception, as the asymmetries in labor relations are huge.

Asymmetries are irrelevant. Apple is worth over $2 trillion, yet cannot force me to buy an Mac Pro. It can only induce me to do so by offering more value than competitors.

If we let Apple and its social justice PR firms convince us that we need the government to control the consumer electronic market, then Apple could, through regulatory barriers, keep competitors, or through taxation, force us to indirectly buy its products, by funding the state that does.