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Very interesting history about MacBride, that I didn't know.

On income effects, Nick (and Scott S) don't talk enough about the huge Net Worth hit homeowners have had, with what they thought was their equity savings being reduced by $50-500k in the house price drop.

Remarks:

1 - Atlas Shrugged is the kid-lit version of Atlas Shrugged. ;)

2 - Your Sarah Palin reference seems to imply that you think she is a libertarian.

3 - There are income and wealth effects at play here; It could be that there is both a "libertarian effect" and a "friendship effect" present in the bequest. I know it can be hard to imagine that libertarians have friends, and that those friendships can (sometimes) involve more than listening to Rush albums over a rousing game of Magic: The Gathering, but it's true...

"MacBride faced a trade-off. He could devote his life to libertarian politics. But given the libertarian party's electoral prospects, that didn’t pay well - actually it didn't pay at all. He had to earn a living. In order to generate income, he had to spend less time on libertarian politics, and more time on other things."

A bit of a tangent: This posting leads me to think about teaching the work-leisure model. Putting something like "time spent in libertarian politics" on the horizontal axis, instead of the more general "leisure time," might be a better way to introduce the model to students. Perhaps students will better understand the idea if a teacher starts with a specific non-income producing activity and then adds other non-income producing activities (leisure is then the sum of specific activities).

Has anyone here tried teaching the model this way?

Michael - " Perhaps students will better understand the idea if a teacher starts with a specific non-income producing activity and then adds other non-income producing activities (leisure is then the sum of specific activities)."

That's what I've found, and that's what appealed to me about the MacBride story. I've also found that the second horizontal axis, the one that shows hours working for pay going in the other direction, really helps as well.

Ryan - It is certain that the bequest had both a libertarian and a friendship motivation - I'm not saying that the friendship motivation was unimportant, only that the libertarian one is more fun to analyze.

Tom - the labour force participation rate in the older age groups has really increased recently, and part of that is almost certainly wealth effects.

I was just making a couple of jokes, anyway...

I think that this can be tied into the recent dairy quota post. Clearly we need a quota on libertarians - there are far too many of them (given the paucity of data to support their views) and thus their continued presence is a waste of air.

Worthwhile Canadian Initiative can do its part by limiting the number of comments by libertarians on any post to one. As all linertarians say pretty much the same thing, that covers the free speechy thing and the bandwidth savings would likely over time pay for the cost of supporting dairy farmers. Win-win.

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