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Sunday, April 12, 2009

Backyard Economics is BACKWARD Economics

My favorite website, Cafe Hayek, alerts me to a post on Charlie's favorite website, Carpe Diem, about the absurdity of "localism" as an economic philosophy:
Using Backyard Economics logic, Duval County residents should only support Duval County businesses, and should avoid patronizing out-of-county businesses.

But let's go one step further. By the same logic, cities located in Duval County like Jacksonville Beach should only patronize shops, restaurants, and businesses in Jacksonville Beach, and avoid out-of-city businesses. But then the logic would also apply to even smaller geographical areas like neighborhoods within Jacksonville Beach (don't buy "out-of-neighborhood"), a neighborhood resident's own block (patronize only "in-block businesses"), and then ultimately a resident's own household.

In other words, the logic of Backyard Economics for state economies like Florida ultimately leads to an individual household's OWN BACKYARD (literally), and complete and total economic self-sufficiency at the household level (don't buy any "out-of-household" goods or services).


Russ Roberts, who posts at Cafe Hayek, said it well in a lecture I attended several years ago. "Self-sufficiency is the road to poverty."

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