To be flippant for a moment: And?

This meant the choice was taken away from people; it was ‘bought.’ All increasing the cost does is move the problem; if you increase the punishment to such a high rate that any company will certainly be deterred, I suppose that could work, but the principle is one of safety and information. My ‘alternative’ (which is actually what happens now) is just to have minimum safety standards, judged by various criteria including how obvious the risk is, and how high it is. This makes the problem one of values and not prices, which, while they may be a measure of value, I – and many others – do not feel are an appropriate one is this area.

In fact I personally think prices are generally only good for things that don’t really matter, like a television. Others think something different, but the difference is moral rather than logical.

You are misunderstanding the purpose of me linking to wikipedia. I thought it would be obvious that is simply to provide those who don’t know with some background information on the case.

No, I understand that this was your purpose. However, one of the factual sources in the Wikipedia article seems to contain facts which tend to disprove claims of extraordinary death rates for the Pinto vis a via the market at the time. My point to moriacathleen was simply that she would have to undermine the entire source (and therefore the entire account) from Wikipedia if she doubted that one source, absent any additional evidence.

In this case, Ford made it so people were unaware of this risk

Which is where fraud prosecution comes in.

putting aside the practicalities of an individual prosecuting an enormous company with mounds of resources and lawyers

This is where class action suits come in.

the costs of prosecution were included in Ford’s initial assessment.

To be flippant for a moment: And?

I already addressed this. You haven’t respond to my arguments. (To recap: 1- lawbreaking is almost guaranteed at a certain level of economic activity, and 2- the remedy for an unacceptably high level of illegal activity is for the government to increase the penalty for breaking that law. That is, to raise the cost.

No, it equates prices and values. This is not the same as amoral.

Price is not the same as valuation, granted. But it is a method of valuation. Is it an imperfect, biased, non-neutral method of valuation? Of course. But I submit to you that all interpersonal, transactional methods of valuation are. The fact that a method of valuation imperfectly transmits and/or enforces human values does not inherently make that method moral. The method simply IS, the morality comes after humans apply their judgment to it.

Once again, I will ask: What is your alternative? I give you my word that I ask out of genuine curiosity, not out of any motive to construct some sort of convoluted “gotcha” moment. I really, truly want to know. I read this and many similar “heterodox” blogs with regularity, and I simply can’t get anyone to give me a straight answer. This fact alone is probably my biggest objection to the entire school of thought. It seems clear to me that you, Keen, and others have something in mind, but I’ve never seen it clearly, logically, and coherently stated. It would ease my mind greatly if I knew what it was you had in yours.

Yeah, there are two main problems here:

(1) Libertarian’s implicit police state, where any law they approve of is enforced without fail, and all the concerns about public choice and regulatory capture, as well as the fact that everywhere (including the legal system) is subject to resource constraints, suddenly melt away. In this case Friedman thought it was sufficient to prosecute for fraud post-hoc, ignoring that the costs of this for Ford can just be included in with the rest of their costs, their access to superior lawyers etc.

(2) The equation of prices and values and subsequent assertion that the problem is one of price and therefore amoral.

Of course, you are welcome to call into question any source you want independent of Unlearning Econ’s cited authorities. Just know that doing so will undermine his/her original claim, which is my ultimate argument.

You are misunderstanding the purpose of me linking to wikipedia. I thought it would be obvious that is simply to provide those who don’t know with some background information on the case.

As I’ve eluded to in my past arguments, the premise of UnlearningEcon’s objections to Friedman’s positions is an objective valuation of human life which exists independent any one person’s evaluation of their own life. Hence his/hers criterion of “too much risk” (whatever this may be) per human life. As opposed to a regime where each person may measure the costs/rewards of any particular life-risking scheme by their own lights.

In this case, Ford made it so people were unaware of this risk. ‘You can prosecute for fraud’ post-hoc doesn’t cut it – putting aside the practicalities of an individual prosecuting an enormous company with mounds of resources and lawyers, the costs of prosecution were included in Ford’s initial assessment. In other words, people’s own right to assess their risks was effectively bought by Ford.

That the value of human life is truly subjective, and no amount of moralizing changes that. The process of transaction between two or more parties to discover this valuation in inherently amoral, and only gains valuation ex-post.

No, it equates prices and values. This is not the same as amoral.

I am not sure why you linked to a poorly written law review article that was part of the Pfizer Distinguished Visitor Series at Rutgers Law School.

I linked to it because I’m lazy and don’t want to do my own research and then defend the veracity of my own sources. That article was one of the major sources cited by the Wikipedia article to which Unlearning Econ linked. I figure that this act functions as a sort of waiver: If you doubt the veracity of the source you cite, or any of its sources, then you should not cite it. If you do so, then you waive any objections to the veracity of any sources in the chain of authority of the the source to which you cite.

Of course, you are welcome to call into question any source you want independent of Unlearning Econ’s cited authorities. Just know that doing so will undermine his/her original claim, which is my ultimate argument.

As though Pfizer would ever sponsor an author that wrote an article in favor of products liability verdicts.

Probably not. But that question has no bearing on the veracity of the arguments fronted by the author. As I’m tiring of arguing to my progressive opponents: ‘the validity of any argument stands independent of the interest any one party has in that argument being valid.’ This holds true even if the party holding forth the argument is particularly reprehensible. Say, for instance: that Adolf Hitler says that the sky is blue, and that Adolf Hitler stands to make a billion dollars if the sky is indeed blue. Neither of these facts have any logical bearing on whether or not the sky is in fact blue. To summarize: you must evaluate the logical argument separate from its proponent. To do the opposite is the essence of the ad hominem fallacy.

The article basically argues that the jury (which is made up of members of the public) is not qualified to make a judgment in a products liability case… And I realize some economists might find these rights to be a nuisance to their objectives, but we have unanimously held that right to a trial by jury is an inalienable right no matter what impact it might have on our GDP or a corporation’s bottom line.

First, I request that you cite the passages which support this assertion. Not that I doubt you, but I simply fail to see this proposition as a rational conclusion to the author’s arguments.

Second, I fail to divine the conclusion which you are driving at. If your assertion is true, what does it prove or disprove?

Third, the limitation of the authority of the jury to consider arguments or evidence is neither uncommon nor inconsistent in our common law tradition. The entire body of the laws of evidence is premised on the hypothesis that the jury may be either incompetent or incapable of weighing certain types of evidence logically.

So, even if true, what does this argument show?

Additionally, the author’s use of the data from the National Highway Traffic Administration is questionable. I don’t have access to the actual study he references, but I would have several questions before I would accept that study as reliable.

On what basis do you attack its reliability? Isn’t this the point of peer review?

Not that all published articled are beyond reproach. But the fact that others in their field reviewed them must at least shift the burden of proving unreliability to the opponent of the evidence or argument in question. That is, you must have at least a reasonable basis for disagreeing with the facts.

Setting reliability aside, I am not sure it is even relevant.

How not? The entire point of the “reasonable expectation” of the ordinary consumer is establishing industry standard. That table on page 1029 shows that, at least in terms of fatalities, the Ford Pinto conformed well with its peers. In light of this fact, proving abrogation from industry standard is difficult. What relevance issue is raised here?

The question presented by Unlearningecon is who has the right to decide how much risk the individual is willing to assume when they purchase a product. Why do you find it so hard to answer that question?

I would say we all have this problem, as evidenced by the fact that we are arguing about it.

As I’ve eluded to in my past arguments, the premise of UnlearningEcon’s objections to Friedman’s positions is an objective valuation of human life which exists independent any one person’s evaluation of their own life. Hence his/hers criterion of “too much risk” (whatever this may be) per human life. As opposed to a regime where each person may measure the costs/rewards of any particular life-risking scheme by their own lights.

I’m having a hard time understanding how you can conceive of any one person’s risk outlay as “individualistic” when governed by a singular conception of human value vis-a-vis risk. A little help, perhaps?

Milton Friedman argues that there is a free market only if the company has the right to decide which product it sells without interference from the government or the individual.

This is, quite simply, a failure of the ideological Turing test: http://econlog.econlib.org/archives/2011/06/the_ideological.html

To put it simply, you have failed to understand how Friedman constructed his arguments.

Unless a person is an anarchist, one believes that the government has a role in determining what persons or groups of persons may do. What the permissible scope of those limitations are and how they may be defined is a matter of debate. But characterizing the possible scope of corporate action as being ‘without government interference’ is simply inaccurate.

Similarly, characterizing corporate action as existing exogenous from individual preferences is simply laughable. People give corporations what the corporations want because individuals are persuaded that is what they want. We can talk about positive feedback and ultimate locuses of control, but saying that corporate selling patterns exist separate of any pattern of individual desire is silly.

Now, Milton Friedman’s little sidestep to say it is okay to prosecute for fraud is of little help. Fraud is a separate issue. This case explains why:

I am well aware of McPhearson v. Buick. I fail to see what it has to do with fraud. Care to elaborate?

The fact is that Milton Friedman probably would oppose any law that allows the individual to recover damages for injuries caused by a defective product.

Cite? Or argument? Anything?

In his world, the individual chose to assume the risk and therefore the individual must deal with the consequences.

Do you see it differently?

Once again, assumption of risk is a term of art, and only applicable in certain situations.

The way I see it, we all assume the risk of engaging in any activity. The relevant question is whether the assumption was knowing and intelligent.

I have no idea why you are trying to undermine the point made in this post by making arguments using terms like Unlearningecon’s social valuation.

Undermining is not my goal. Rational inquiry is.

I seek to adopt my opponent’s language because that way I do not have to explain my own to them. By attempting to understand my opponents on their own terms, I find I am sometimes able to construct their arguments in ways that I better understand. Thus, I can incorporate their valid arguments into my own understanding of reality.

The major reason I pay attention to UnlearningEcon is that he/she is good at pointing out the underlying assumptions of the heuristic analysis I currently subscribe to. Having this basis constantly questioned is a good thing. However, UnlearningEcon is not nearly as good at conveying or describing an alternative method of analysis. That is why I comment, and question. Critical analysis is one thing, rational construction is another. UnlearningEcon needs to move from the former to the latter.

What Milton Friedman and too many other economists cannot accept is that some things are incommensurable, or rather that life in the real world presents issues that require subjective valuations.

That statement in and of itself is objective. That is, it is a claim of superimposed valuation to which all others must submit. How do you defend your premise?

The question for a society is who has the right to decide when an issue requires a subjective valuation. Unlearningecon appears to adopt a view that the right to decide rests with the individual rather than the corporation.

This made me smile. The entire thrust of UnlearningEcon’s arguments has been that there is a certain amount of risk beyond which no person may morally subject another. That is, there is an objective valuation of human life, to which all others are subject. You have UnlearningEcon’s arguments exactly backwards.

What is your view?

That the value of human life is truly subjective, and no amount of moralizing changes that. The process of transaction between two or more parties to discover this valuation in inherently amoral, and only gains valuation ex-post.

What is yours?

The important thing is that people do not know these things when they buy.

But in Friedman’s world, everyone has perfect knowledge because it is in their interest to do it, since everyone is optimizing his/her utility! People would have rejected the car if that were so!