Saturday, February 15, 2014

Mitigating Middleman Moral Mileage

Buy cheap, sell dear. This is the middleman's maxim. She improves not her wares, merely transmitting them as near as possible in their original state from the hands of a willing seller to a willing buyer. WoN, IV.2.30:
The act of navigation is not favourable to foreign commerce, or to the growth of that opulence which can arise from it. The interest of a nation in its commercial relations to foreign nations is, like that of a merchant with regard to the different people with whom he deals, to buy as cheap and to sell as dear as possible. But it will be most likely to buy cheap, when by the most perfect freedom of trade it encourages all nations to bring to it the goods which it has occasion to purchase; and, for the same reason, it will be most likely to sell dear, when its markets are thus filled with the greatest number of buyers.
The consequentialist defense of the mancgere is clear: without someone to navigate the water and roadways of the world, it'd be pretty dang tough to get peppercorns in Continental Europe or Toyotas in Kenya.

Please review Mungo's latest piece here and ask yourself if adding moral distance to an exchange is an underappreciated benefit provided by double arms' reach exchange.

To wit, if the actress in question were to provide the same commodity directly to her professors, a barter exchange where a market exchange were available, the issue would cease being a moral curiosity and immediately become grounds for, inter alia, a few hearty rounds of termination of employment.

NB that adding moral distance makes no value distinction. Sometimes it's wise and useful to close buyers and sellers, particularly if doing so can help make Pareto improvements. But don't be too hasty to abandon the virtue of temperance: sometimes moral distance is a feature, not a bug.

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Do you have suggestions on where we could find more examples of this phenomenon?