Here’s a letter that I sent yesterday to the Jacksonville, Florida, newspaper. (HT Tim Townsend):
Editor, Florida Times-Union
In “Florida’s economy: Support local business” (April 9) you report that some Floridians are trying to boost Florida’s economy by “buying local.” The idea, of course, is that if Floridians buy as much as possible from other Floridians, rather than from non-Floridians, then economic activity in Florida will be stronger.
Suppose that to promote, say, Florida peach growers, consumers in Florida reject good deals on peaches from South Carolina. Florida peach-growers benefit, but other Floridians suffer. By
paying more than necessary for peaches, Florida consumers not only directly make themselves poorer, but they also have less money to spend elsewhere, such as at the local car-repair shop and at local restaurants. In addition, to the extent that the misguided ethic of “buying local” takes hold, local firms have weaker incentives to improve their efficiencies and product offerings. The state’s economy suffers, both today and especially tomorrow.
Florida’s buy-local effort boasts the charming name “Backyard Economics.” A more appropriate name would be Backward Economics.
Donald J. Boudreaux