The Distributed Republic - General en 21st Century Socialism <p> <a href="">The New Model</a> </p> <blockquote><p> &quot;It might look great for a while, but we know these are formulas that don't work,&quot; said Hernando de Soto, a Peruvian economist who has written extensively about how to legitimize informal economies. </p> <p> In co-ops and state companies, Chávez's policies have generated legions of devoted followers like Iris Pinto, 31, who said her life had been dull, mostly cleaning homes. Now she's at the shoe factory. </p> <p> &quot;He's a wonderful president, really socialist,&quot; she said. &quot;President Hugo Chávez Frías gave us this opportunity, and it's been completely successful.&quot; </p> </blockquote> <p> While a 45 year old Iris may not be bored when her primary diet turns to shoes, black, it is likely true that her economic ignorance only places her in the middle of the pack for the US Congress. </p> General Tue, 07 Aug 2007 17:20:15 +0000 Don Lloyd 9822 at The Basis of Ron Paul's Economic Philosophy in 24 Pages <p> <a href="">Pdf file</a> </p> General Mon, 06 Aug 2007 20:37:31 +0000 Don Lloyd 9819 at The Wild Wheel <p> <a href="">The Wild Wheel</a> </p> <p> A great story about a moonlighting employee of Thomas Alva Edison. </p> <p> <a href="">The $18 paperback</a> </p> <p> <a href="">The pdf file</a> </p> <p> &#160; </p> General Mon, 30 Jul 2007 20:20:41 +0000 Don Lloyd 9802 at The Case of the Minimum Wage Gas Station Attendant, a Problem in Economic Analysis <p> Vladimir is a legal immigrant working his second job on the lonely night shift at BORDER CITSTOP GAS, a station with three self-service pumps and one full-sevice pump. The station is located in Indiana, 200 yards from the Illinois border, and all of its effective competition comes from several nearby stations in Illinois. </p> <p> Vladimir's shift is twelve hours long, from 8 PM to 8 AM, six days a week. He is paid the Indiana legal minimum wage, assumed to be $6 per hour for this problem, pre-tax, and no considerations of overtime are to be invoked. For simplicity, assume that the $6 per hour rate is also the total employment cost of Vladimir to the station owner. </p> <p> The rounded pump prices are $3 a gallon for self-service regular, and $3.24 per gallon for full-service regular. For simplicity, premium grades of gasoline are to be ignored in this problem. </p> <p> On the first of August, the Indiana legal minimum wage will increase by one third to $8 per hour. </p> <p> What are the most likely expected consequences of this increase? </p> <p> &#160; </p> <p> POST COMMENT ANALYSIS : </p> <p> The key point is that the wages paid to Vladimir are not dependent on sales quantities or revenues, i.e. are not marginal or variable costs, and thus are not involved in the setting of profit-maximizing (or loss-minimizing) prices. Only if there were a non-slack, non-recoverable opportunity cost to the owner for Vladimir's time would there be an effect on prices. For example, if Vladimir spends the time not used  for servicing either self or full service customers knitting station momentos for owner sale, then their revenues forgone would be a marginal cost that could change the prices. More likely, Vladimir catches up on his sleep between customers. </p> <p> So the simplest answer is that the prices will not  change and the station will be shut down overnight, as the extra (relative) fixed cost of $24 a day may destroy any profitability of remaining open, with Vladimir getting laid off. Note that some of the business lost during the night may reappear during the day. </p> <p> This problem has a unusual characteristic in that the profit maximizing price for full-service alone increases when self service come into the picture. If the full service price is raised enough to reduce the quantity sold by one gallon, the full revenue loss only occurs if none of the demand is shifted into  self service. </p> <p> &#160; </p> <p> &#160; </p> <p> &#160; </p> <p> &#160; </p> <p> &#160; </p> <p> &#160; </p> General Thu, 26 Jul 2007 11:35:02 +0000 Don Lloyd 9799 at 1-800-54GIANT <p> Listening to a Red Sox radio commercial, does any country besides the US have independent mobile vans that come to your parked car in response to a call and replace a cracked windshield for almost any car? </p> <p> &nbsp; </p> General Tue, 24 Jul 2007 23:55:59 +0000 Don Lloyd 9794 at If You Only Had a Brain <p> <a href=",1518,495607,00.html">Tax Official All Wet</a> </p> <p>Tiny Brain No Problem for French Tax Official</p> <p class="spIntrotext"> Something that many people secretly believed has been confirmed: You don't actually need a brain to work in a tax office. A French civil servant has been found to have a huge cavity filled with fluid in his head -- yet lives a completely normal life. </p> <p class="spIntrotext"> &#160; </p> General Sat, 21 Jul 2007 17:40:04 +0000 Don Lloyd 9788 at Printer Privacy Invasion <p> <a href="">Yellow Dots</a> </p> <p> &#160; </p> General Sat, 14 Jul 2007 11:50:18 +0000 Don Lloyd 9779 at The Declaration of Independence, Performed <p> <a href="">DOI-source</a> </p> General Thu, 12 Jul 2007 12:34:49 +0000 Don Lloyd 9773 at What's Wrong With This Picture? <p> <a href="">Casio Wave Ceptor</a> </p> General Mon, 09 Jul 2007 03:16:58 +0000 Don Lloyd 9763 at Lifeboat Economics <p> You're the purser of the Titanic and it has just hit an iceberg. </p> <p>  You've escaped into a lifeboat with an 80 pound bag of gold, an 80 pound bag of silver, and an 80 pound bag of copper. The lifeboat starts to flounder* from being overloaded. You push Al Gore over the side, quieting and improving the lifeboat environment, but the lifeboat is still overloaded. </p> <p> It is now clear that you will only be able to salvage one of the 80 pound bags if the lifeboat is to stay afloat. </p> <p> You choose to save the gold bag, and toss the silver and copper bags into the Atlantic. </p> <p> If this were an opportunity cost problem, then the opportunity cost would the second best choice, i.e. the 80 pound bag of silver. However, it is clear that the actual cost or sacrifice of saving the gold bag is the combination of both the silver and copper bags (and Al Gore, but he doesn't count). </p> <p> QUESTIONS : </p> <p> If this is an opportunity cost problem, why is the opportunity cost not equal to the standard opportunity cost definition? (the silver bag alone) </p> <p> If this is not an opportunity cost problem, why not, and what is it? </p> <p> These are not known to be trick questions, but they are currently open questions with no known answers. </p> <p> &#160; </p> <p> * = <em><strong>Usage Note</strong></em>: The verbs <em>founder</em> and <em>flounder</em> are often confused. <em>Founder</em> comes from a Latin word meaning &quot;bottom&quot; (as in <em>foundation</em>) and originally referred to knocking enemies down; it is now also used to mean &quot;to fail utterly, collapse.&quot; <em>Flounder</em> means &quot;to move clumsily, thrash about,&quot; and hence &quot;to proceed in confusion.&quot; If John is <em>foundering</em> in Chemistry 1, he had better drop the course; if he is <em>floundering,</em> he may yet pull through. </p> <p> &#160; </p> General Thu, 05 Jul 2007 13:52:30 +0000 Don Lloyd 9753 at