Frankly Baffling

by Don Boudreaux on January 1, 2012

in Competition, Dinner Table Economics, Education, Myths and Fallacies, Work

Here’s a letter to the New York Times:

Sounding his familiar theme that private economic activity is mainly a negative-sum quest for “positional goods,” Robert Frank asserts that “many second paychecks today go toward financing a largely fruitless bidding war for homes in good school districts” (“Why 2 Paychecks Are Barely Enough,” Jan. 1).

Ignore Mr. Frank’s mysterious insistence that today’s larger and better-equipped houses are evidence of parents’ “fruitless” competition to live in neighborhoods with superior schools.  (If parents are driven overwhelmingly by a desire to gain access to above-average schools, why do they waste money paying for more square footage and granite countertops?)  Focus instead on what Mr. Frank’s thesis implies about the agency – government – that he calls upon to save us from self-destructive competitive urges that are allegedly unleashed by inadequately regulated and insufficiently taxed market forces.

If government were truly alert to the demands of its constituents, government-school quality would rise in response to parents’ demands for higher-quality schooling.  School districts would compete to improve their quality relative to other districts.  That Mr. Frank implicitly denies that government responds in this way should caution us against accepting his repeated calls to turn over to government more of our money and liberties.

Sincerely,
Donald J. Boudreaux
Professor of Economics
George Mason University
Fairfax, VA  22030

See also David Henderson’s reaction.

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