“The phrase “maximizing human welfare” implies that “human welfare” can be measured, i.e. it’s an objective, empirical phenomenon. It’s no such thing, however.”
We can tell by human action what individuals prefer, and if individuals did not prefer less scarcity and lower prices then I believe that this would come through in their actions and markets would arrange themselves into situations where consumers voluntarily paid higher prices. If this were the case then most modern market successes would be failures. At any rate, I’m not saying we can measure welfare in a quantitative sense, but we can in a qualitative sense, that is to say we know that firms which provide lower prices benefit a larger number of people than firms which charge higher prices. How much this has increased human welfare, however, is beyond human measuring.
“I think you omit at least one other possibility - that some people (likely business owners IMO) do chip in and build the road, and they pass the costs of building and maintaining it onto their customers.”
That certainly is a possibility, as is (this is what I believe would be the optimal form of organization) a group of people coming together and supporting a non-profit community run road building organization. All I am saying here is that it is not as intuitive and natural for this to be built as it is for bob to open up a shop down the street to make make pretzels, and there are other cases, such as say, statues, where everyone might want X good but it is not paid for because there’s no real way to pay for it. Although I have to say that once you get outside of roads and defense the collective goods become increasingly more “Boo Hoo” cases.
“Again, I fail to see how it’s necessarily the case that “no one person can affect the amount of defense provided”. And whose standard of “well” are you talking about with regards to providing roads and defense?”
You’re right, that depends upon the size of the specific market for defense. Here we have sort of an odd case because in many ways it depends upon whether or not we’re conceiving of defense within a void, because militaries are very expensive things to start up but after the fact they’re actually surprisingly cheap to maintain. If we assume that modern weaponry is taken from the current statist society when the new stateless one is born, then in most cases defense could be noticeably influenced by the richest members of society. However, if the start up costs for the military were involved then these would likely be enormous. No one short of the top 10 richest people alive could influence a military budget the size of the United States, but there are tens of thousands who could influence Russia’s (for the hell of it we’ll assume that defense budget is what it would take to protect a large country with the greater efficiency but smaller economies of scale which would be inherent in multiple military organizations).
Buuuuuuut at any rate, there are not many people who could influence a multi billion dollar industry by giving even the totality of their income, and if war were to actually break out then the fact is that it’s an extremely expensive affair. As soon as we reach the 100 billion dollar mark, even mega millionaires can only make some .X percent difference, and billionaires can only effect it by percentage points unless they sell off large amounts of their assets to pay for a single year of defense, and all this, of course, is assuming that these people believe that there is danger which needs to be defended against, or that if there is danger, that it can be stopped by the organization.
“It seems to me that an individual can affect the production of things like roads and defense much more than he can affect the outcome of an election by voting (which I assume is what you mean - there are other ways in which an individual could more significantly affect the outcome of an election).”
Depends upon the individual and the industry. And there’s no real way for any one individual, short of being a campaign manager, and there can only be so many of those, to make a noticeable influence upon a campaign… Hell if there was then Ron Paul would have easily snagged the nomination because of how dedicated his supporters are!
At any rate, the point is that I could not, even if I spent my entire yearly income, make a noticeable difference in the production of a large roadway because those are very expensive to produce. The big problem, of course, is that there’s a lot of roads which would need to be produced in the stateless society. A fortunate break for the anti-statists, however, is that many roads in developed countries are already produced. Indeed I’d argue there’s an obvious surplus of roads. And this means that these things need not be produced, only maintained, which is infinitely cheaper.
“This might be tangential or even moot, but aren’t externalities subjective?”
Kind of… You could argue that a mother who has a baby who becomes a doctor is a case of an externality, and that therefore we should fund more mothers to have babies or some derp argument like that, but there are more down-to-earth examples of an externality, like the fact that if I improve my house local home prices go up and so everyone’s assets increase in market value, and yet they have not had to do anything. You can argue against externalities based upon their subjectivity, or from a reducto ad absurdum standpoint, but the fact is that there are cases where people do things, or don’t do things that are harmful or beneficial respectively, which others value and would pay to/not to happen if there were a market on this, but where there is none in reality.
“How exactly is “Marginal Social Cost” measured?”
By most mainstream economists it’s usually done by the market value of what is lost or by what people would have paid for for it to not happen.
“Again, this implies that “human welfare” can be measured somehow. Where do you think monopolies (especially natural monopolies) would exist in a free market?”
Local area monopolies and name brand companies are the only monopolies which could really be maintained on a free market. Utilities and roads, should they be provided by independent private companies, are both examples of this. Mises does a good job of identifying them in the monopoly section of HA. The fact is that in a small town it’s inefficient to have more than one water company functioning as it can probably only uphold a single economy of scale that provides anywhere near an efficient output. On a street block realistically only one road can be provided to these houses. It’s also inefficient as hell to even conceive of things like competing bridges…
We can also tell a priori that the welfare of consumers would be maximized if these firms did not charge a monopoly price.
“I’d say that depends on what you think the state is providing.”
Yes it does because value is subjective. But if we look at increasing people’s purchasing power and their ability to buy things they desire then it’s sure as hell not doing that.
