Assigning the Burden of Proof

Have you ever experienced learning a new word and then hearing it everywhere in the days after you learn it? I’ve had a similar experience since making my argument that the burden of proof that the minimum wage is beneficial falls on the law’s supporters. Now I’m seeing people making burden-of-proof arguments everywhere. Bryan Caplan, in a post on EconLog, quotes Mike Huemer making the argument explicitly:

[T]here is a kind of moral presumption against coercive interventions. Laws are commands backed up by threats of coercive imposition of harm on those who disobey them. Harmful coercion against an individual generally requires some clear justification. One is not justified in coercively harming a person on the grounds that the person has violated a command that one merely guesses has some social benefit. If it is not reasonably clear that the expected benefits of a policy significantly outweigh the expected costs, then one cannot justly use force to impose that policy on the rest of society.

Ryan P. Long, over at Open Borders: The Case, makes what is essentially a burden-of-proof argument for open borders:

[W]hile it’s easy to merely allege that “the immigrants” caused crime to increase in your neighborhood or property values to decrease, it is substantially more difficult to prove it. I leave the burden of proof for [the idea that the differences between people really do translate into a reduced quality of life] on immigration’s critics.

Migrants from poor countries often see a 20-fold increase in their earnings just by setting foot in a wealthy country, so you had better have a good reason for barring them from doing so. The people at Open Borders: The Case do a great job arguing for the positive benefits of increased migration, but if we assigned the burden of proof correctly, it would be open borders’ opponents who would have to do the hard arguing. (more…)

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Opaque Facts

Welcome to Night Vale

“Some mysteries aren’t questions to be answered, but just a kind of opaque fact—a thing which exists to be not known.” – Welcome to Night Vale: A Story About You

The above quote was in an episode of the excellent podcast Welcome to Night Vale. I love the term “opaque fact,” and it strikes me that economics is full of opaque facts, and that our distinctions between opaque facts and mysteries largely determine our views of markets.

People’s preferences are opaque facts. We can’t know other people’s preferences; the best we can do is observe their past actions to infer something about their past preferences.

Supply and demand curves are also opaque facts. We know that for some definite price of a good, sellers will attempt to sell and buyers will attempt to buy some quantity of the good in question. If we were all-knowing, we could draw curves representing every hypothetical amount of goods buyers and sellers would want to buy and sell if confronted with each possible price, and these would be the demand and supply curves. However, only one price and quantity are actually observed, and the curves themselves are not constant over time. Thus, we never see more than one data point of our supply and demand curves, so we can never derive their shape. Supply and demand curves are opaque facts, not mysteries we can solve with clever statistical analyses.

In my view, it is the people who have failed to recognize the opaqueness in all economic phenomena that have created the most harm. The Phillips curve is the most famous example: economists discovered a negative relationship between inflation and unemployment, assumed that this could be exploited, and encouraged governments to combat unemployment with inflation. They viewed the relationship between inflation and unemployment as a mystery, one that could be solved by sufficiently determined researchers and then added to human knowledge like Pythagoras’ theorem or the Earth’s gravitational constant. If they had exercised some humility, they might have realized that the relationship between inflation and employment is not a fixed, discoverable constant, but an opaque fact that can change with people’s beliefs.

The post Opaque Facts appeared first on The Economics Detective.

Opaque Facts

Welcome to Night Vale

“Some mysteries aren’t questions to be answered, but just a kind of opaque fact—a thing which exists to be not known.” – Welcome to Night Vale: A Story About You

The above quote was in an episode of the excellent podcast Welcome to Night Vale. I love the term “opaque fact,” and it strikes me that economics is full of opaque facts, and that our distinctions between opaque facts and mysteries largely determine our views of markets.

People’s preferences are opaque facts. We can’t know other people’s preferences; the best we can do is observe their past actions to infer something about their past preferences. (more…)

The post Opaque Facts appeared first on The Economics Detective.