Quotation of the Day…

(Don Boudreaux)

Tweet

… is from page 44 of Thomas Sowell’s excellent 1993 collection, Is Reality Optional?:

Prices force us into trade-offs, which is one of many reasons why the marketplace operates so much more efficiently than political allocation according to “need,” “entitlement,” “priorities” or other such rigid notions.

DBx: Yep.

I would, however, amend Sowell’s wording slightly. We’re not forced into trade-offs by prices; we’re forced into trade-offs by scarcity. Scarcity makes trade-offs inescapable. Rather, market prices (1) make trade-offs visible, revealing as clearly as possible each option’s cost, and no less importantly (2) put the consequences of choices as fully as possible on the individuals responsible for choosing just how to make each particular trade-off.