Random musings from a small sample on a subject about which I know little.
Where did I read that military amateurs talk strategy, but military professionals talk logistics? Or that if they did a re-make of The Graduate, the one word career advice would be changed from "plastics" to "logistics"?
I broke a front coil spring on the MX6 Saturday evening. After checking to see there was no danger of the broken spring piercing the tire, I limped it 200kms home. It's a 1994 car, they stopped making them in 1997, there are now very few MX6s left on the road (or in junkyards), so I was worried about finding spares. Monday morning I go to my local auto parts store. Within one minute they located a set of springs (made in Taiwan) in Montreal. They arrived Tuesday morning, and I replaced them Tuesday afternoon. I decided to replace the strut dust covers at the same time. The generic dust covers they had on the shelf didn't have the right look, so I went to the Mazda dealer, who located four OEM dust covers in Chicago (the last four in North America), and got them to me early Tuesday afternoon(?!).
Young people might find that totally normal (and would maybe have found the parts themselves on Ebay). But I'm old enough to find it amazing. It is amazing. It's as amazing as the geneology of "I pencil". We should look on it with as much wonderment as Hayek looked on the price system in "The Use of Knowledge in Society" (read it, if you haven't already).
But there's a much closer relationship between Hayek's justly-famous essay and my finding spare parts for my MX6. Both involve communication of local knowledge.
I knew I needed a set of springs for an MX6. Someone in Montreal knew he had a set of springs for an MX6 in inventory (or maybe he didn't know that, but his computer did). But I didn't know what he knew; and he didn't know what I knew. And we couldn't have made our mutually improving exchange of my money for his springs without some sort of communications system to connect our two sets of local knowledge.
I do not know how that communications system works (presumably it's some sort of internet thing). But I do not need to know how that communications system works in order to benefit from using it. Similarly, people do not need to know how the price system works to communicate local knowledge in order to benefit from using it.
I think the two communications systems are complementary.
I wonder if all the benefits of improved logistics are captured in GDP data? As far as Statistics Canada knows, all that happened is that someone bought a set of four springs for $310. That doesn't capture the benefit to me of not having my car sitting on blocks for weeks while I search or wait for springs.