How wealth is created

Unless you realize how wealth is created, you’ll fret about how to distribute it more equally, thinking the only way the poor can become richer is by receiving some of the wealth the rich have. Wealth is not created by industrialization, though it can be helped by this. It is created by specialization and trade. At the GI blog Tim Worstall draws attention to the wealthy trading towns of the Roman period. He cites the discussion on Marginal Revolution about the drop in living standards between Roman times and the 18th Century. The reason is the cutback over the intervening years in specialization and trade. It’s a timely reminder that while the application of potent energy sources to mass production assists this process, wealth was being created in the ancient world long before water and steam mills proliferated. It reinforces our determination to increase the wealth of poorer peoples by making it easier for them to specialize and to trade.

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written by Steve Giess, April 16, 2008

One way of helping the overall economy would be to create a market for personal tax.

I heard great glee on Irish radio this morning on the news that a large UK pharmecutical company was going to relocate to Eire "just for tax purposes" as the corporation tax rate there is markedly lower than in the UK (the relocation being no more substantial than a brass plate on an office wall).

Well fine I suppose, but what about us smaller fish who are in what is a captive monopoly at the moment? Why shouldn't we be able to choose who to pay tax to as well? This way we can lever some efficiency using market forces. Imagine being able to choose to pay zone A tax system if it and its services suited you more than zone B's or C's. It would put the EU concept of an open market for services etc into a positive light. Administrations that did not suit your own preferences for taxation would find they lost your business. You could even use this EU ID Card when buying goods and services to allow for indirect taxes to be covered by this concept as well.

I can hear the critics now - however such a change would mean that the citizen finally got a grip on profligate Government, instead of just being a captive vassal to be exploited by the electoral clout of local lay-abouts.

What about it ASI?

Written by Dr Madsen Pirie
Wednesday, 16 April 2008
Unless you realize how wealth is created, you’ll fret about how to distribute it more equally, thinking the only way the poor can become richer is by receiving some of the wealth the rich have. Wealth is not created by industrialization, though it can be helped by this. It is created by specialization and trade. At the GI blog Tim Worstall draws attention to the wealthy trading towns of the Roman period. He cites the discussion on Marginal Revolution about the drop in living standards between Roman times and the 18th Century. The reason is the cutback over the intervening years in specialization and trade. It’s a timely reminder that while the application of potent energy sources to mass production assists this process, wealth was being created in the ancient world long before water and steam mills proliferated. It reinforces our determination to increase the wealth of poorer peoples by making it easier for them to specialize and to trade. Bookmark Comments (1) Subscribe to this comment's feed ... written by Steve Giess, April 16, 2008 One way of helping the overall economy would be to create a market for personal tax. I heard great glee on Irish radio this morning on the news that a large UK pharmecutical company was going to relocate to Eire "just for tax purposes" as the corporation tax rate there is markedly lower than in the UK (the relocation being no more substantial than a brass plate on an office wall). Well fine I suppose, but what about us smaller fish who are in what is a captive monopoly at the moment? Why shouldn't we be able to choose who to pay tax to as well? This way we can lever some efficiency using market forces. Imagine being able to choose to pay zone A tax system if it and its services suited you more than zone B's or C's. It would put the EU concept of an open market for services etc into a positive light. Administrations that did not suit your own preferences for taxation would find they lost your business. You could even use this EU ID Card when buying goods and services to allow for indirect taxes to be covered by this concept as well. I can hear the critics now - however such a change would mean that the citizen finally got a grip on profligate Government, instead of just being a captive vassal to be exploited by the electoral clout of local lay-abouts. What about it ASI? Write comment This content has been locked. You can no longer post any comment. Powered by Azrul's Jom Comment for Joomla!