Is this the dumbest economic argument in the world?

What is market value other than "the community's valuation of the external costs and benefits of the activity"?

External costs and benefits are, by definition, costs and benefits that are external to the market value. If they were within the market value, they would have been internalized, and therefore not be externalities.

So the answer to this rhetorical question is: exactly not that. Or perhaps more precisely: don't talk bollocks.

This guy (Mark Wadsworth) is a free-marketeer, so I am embarrassed to see him displaying such fundamental lack of economics, or even basic logic. But it's typical of the crowd that support Land-Value Taxation.

He must work in financial services.



I know perfectly well what externalities are.

But we were debating the specific topic of whether land owners ought to be able to use their land as they see fit. I said that they did, to which you countered that this did not take account of externalities, and I asked you for specific examples of what external costs (i.e. losses to third parties) would flow therefrom.

I agree that there are externalities, but I was asking you for specific examples. I also explained, in the wider context, why a replacing as many taxes as possible (starting with Business Rates, capital gains tax, Stamp Duty Land Tax, just to get the ball rolling) with a flat rate tax on site values would automatically compensate land owners who 'lost out' (i.e. their tax bill would go down).

Furthermore, your main example of an externality was that a business that could make less profit per square yard (i.e. a wood pellet merchant) would always be priced out by a business that made more profit per square yard. From where I am sitting, this is a benefit and not a cost.

Mark, People can judge for themselves whether you know what an externality is. Your words speak for themselves. Do you deny that you wrote this?

The rest of what you write here is lies and distortion. Again, people can see the debate on your site and judge for themselves.

Again, lies or incomprehension. I did not say that was an externality. People can look at the debate and decide for themselves.

Now, remember the first rule of holes, and stop digging.

I'll happily 'stop digging' if you could give me a few real life examples of 'externalities' that flow from allowing landlords to rent out their premises to whichever business offers the highest rent. And yes there are some, I'm not disputing it.

Mark, You've made your modus operandi quite clear. You lie, you distort, you redefine terms even to the extent of claiming that black is white, you create straw men to attack, and ignore the arguments that your opponents really made. There appears to be no possibility of having a reasoned debate with you, so why would anyone waste their time trying? I gave it more time than I should have over on your site, and don't intend to repeat the mistake.

Even in this "request", you demonstrate your tendencies. I didn't say that externalities "flow from allowing landlords to rent out their premises to whichever business offers the highest rent". Externalities do not "flow from allowing a landlord" to do something, they are effects of an activity whose impacts are felt by people who are not party to the transactions relating to that activity. And they have nothing to do with whether the highest rent was offered for the premises. If the landowner chooses to accept a lower rent for the property than could have been obtained from another tenant, the activities carried out on the property may still incur externalities, and (unless they are internalized) the value of those externalities is not necessarily related to the level of the rent (because they are external, get it?).

Externalities are external to market value, by definition. No amount of examples or debating can change this, and the fact that you seem to think they could, again suggests that your purposes are disingenuous and deceitful.

It was a brain-dead comment. If you want to restore any faith that you are someone worth discussing things with, you should acknowledge that it was dumb, so that there is some reason to hope that we can at least rely on words to have their lexicographic meanings. Otherwise we are in a looking-glass world, and you are Humpty-Dumpty, defining a word to mean "just what I choose it to mean, neither more nor less".

I cheerfully admit that you completely wrong footed me by (apparently) claiming that the fact that a coal merchant (or whoever) could afford to pay a higher rent than a wood-pellet merchant was somehow A Bad Thing (or that's how I understood it).

My view was, that is in itself not 'an external cost' of the decision of the landlord to refuse to let to the wood-pellet merchant at a below-market rent, this is in fact an 'external benefit' because the land gets used more efficiently. If 'the community' (God I hate that word) values coal (or whatever) over wood pellets, then obviosuly it is of some benefit to 'the community' if they have a coal merchant rather than a wood-pellet merchant trading from that particular site.

I do feel that you are being unnecesarily agressive in response to my simple request for a brief list of the 'external costs' you see attaching to a policy of encouraging landlords to use their sites to their full potential (i.e. by renting them out ot whomever can pay the highest rent).

This is quite a separate issue to the fact that if there's a coal merchant, the immediate neighbours have the noise of the delivery lorries and might get a light dusting of coal dust; a fair comparison with a wood-pellet merchant seems to be that the immediate neighbours have the noise of the delivery lorries and a light sprinkling of saw-dust. I don't see a big difference here (or how you could measure accurately which one is 'worse').


To paraphrase your first paragraph, "I regret that your unreasonableness tricked me into an infelicity of expression." Gordon would be proud.

You're doing it again. I did not claim "that the fact that a coal merchant (or whoever) could afford to pay a higher rent than a wood-pellet merchant was somehow A Bad Thing". Adding "apparently", and "that's how I understood it" doesn't make it so, or even a reasonable interpretation.

And having pointed out once already that neither my argument nor the definition of externalities relates to the question of whether the landlords get the highest rent possible, you choose (true to form) to ignore that, and repeat the unjustified challenge. Yes, I'm being aggressive. This sort of behaviour is the reason why.

Anyway, this is all irrelevant to the question of whether your dumb-ass comment makes any sense. It doesn't, and if you know the slightest thing about externalities, should never have crossed your mind.

You had an opportunity to show even the slightest hint that you were capable of reasoned debate within the constraints of truthfulness and semantic consistency, and you chose not to take it. That removes any doubt I had whether I ought to try to continue to engage with you on the subject. So to be clear, I will not be getting into any further debate with you.

Now, give it up, and go away. 

Telling me to go away in a rather unfriendly manner does not actually help me in understanding which 'external costs' you were referring to.

All I said in my original post was 'It seems to be a good idea for landlords to maximise their rental income' (from which I drew certain conclusions), I don't see how that is particularly controversial. You did not seem happy with that.

Perhaps you are happy with it, if so then just say that you are happy with it (rather than just insisting that I misunderstood you) and go on to explain which external costs you meant.


I don't seem to be making myself clear. Let's see if I can express it in a language you understand:


I am not getting into a debate with you, because you have repeatedly shown that you will twist anything that I say. I am not going to provide any more material for you to distort. Do I have to block your IP address, or will you please just go away?

Here's an example of the disingenuity I'm talking about, from the debate on Mark's site. These are quotes from three of his comments, in short succession:

  • "an LVT based on market values (i.e. the first approach) would achieve this without any fancy crapola layer of quangoes (no 'picking losers' on this 'blog, thank you very much!):" 13 April 00:50
  • "Turning to other externatlities, that's why we have planning restrictions. If some madman wants to build a nuclear power station or pig farm in the middle of a genteel area, then they won't allow him." 13 April 10:44
  • "You say "the relevant planning authority - would negotiate the price with the developer".  I say 'quango'." 14 April 07:47

So he doesn't want a system with quangoes, he wants to rely on planning decisions to deal with most externalities, and planning authorities, in his view, are quangoes. Nice logical consistency.

This was just throwing shit at a wall, hoping some of it would stick. You cannot debate with someone like that. That is why I have refused to debate with him unless he accepts the constraints of rational debate, and acknowledges that he was far from doing so in the earlier debate.