Buying local

As I indicated in yesterday's blog post, the student newspaper at my institution ran a front page story touting the benefits of buying local. In the spirit of my colleague Don Boudreaux, see below my response to the newspaper - which clearly lacks Don's pithy conciseness.

Amy Shaw, in a 2007 view, displayed an very different perspective to exploring the issue of buying local to that of Jacqueline Bernatt, the author of the Feb. 9, 2010 Mesa Legend editorial - "Helping Arizona's Economy". Had Shaw written a news story rather than editorial for the Mesa Legend, she might have titled the report Does Buying Local Influence the Arizona Economy". In fact, Shaw in "Is Buying Local Really Good" reflects the essence of solid news reporting and scholarship which is exemplified in her conclusion:

At the end of all this questioning (and this is just the beginning), I’m left with only more questions. Of course there are myriad arguments for why buying local is better than the corporate alternative . . . But I also see that what’s important is that we not take ideas like “buy local" for granted.

But I will question received truths, for we must be ever mindful . . .

Shaw reflects a critical perspective absent in the Mesa Legend editorial. Had Bernatt's editorial properly been placed on the editorial page I would not have responded. While I disagree with the illusion, myth and falsehood of this point of view, Bernatt in a free and open society is entitled to both hold and express this opinion and the editorial page is the place for this opinion. I do wonder about the training of young journalists who are allowed to use the front page of a news magazine for opinion that is appropriately located on the editorial page. There were numerous misstatements in the Legend editorial, an absence of citation or effort to seek a full view of this important question and no effort to explore other points of view. Shaw, on the other hand, clearly has reviewed the work of economists, biologists and ecologists in her thoughtful piece that concludes with more questions than assertions.

I suppose I am concerned most with the clear advocacy in a front page story in a news publication, a spot that traditionally has been reserved for news coverage the encompasses the ethical standards and best practices of journalism. The media is an essential institution in a free and open society. To the extent that participants in that institution weaken and damage that institution they pose a clear and present danger to a free and open society.

On to a more nuanced view of "buying local". Social scientists have been intrigued by the operation of human agents in society. The operation of those agents (consumers and producers) can take place under any number of systems, ranging from the natural liberty of Adam Smith to the totalitarianism of Stalin.

Regardless of the system that informs human behavior we each individually act in ways to achieve our own goals based upon the knowledge we have available. In Knowledge and Decisions Thomas Sowell outlines the process of decision making and the types of knowledge that can be used for decisions. He sees knowledge as falling into theory, vision, illusion, myth, fact or falsehood.(4-5) Bernatt's article includes all categories with the exception of fact, but the predominant form of knowledge or information used by this editorial writer is illusion, followed closely by falsehood.

The illusion presented that buying local is stimulative to an economy is false. Empirical evidence clearly indicates that voluntary trade is positive sum in its result - agents (consumers and producers) that freely and without coercion create opportunities that expand the economy of a country. The reverse is also true - policies that limit or reduce trade eliminate opportunities and contract the economy. Examples are numerous, compare the economy of the US (free trade - buying internationally) with North Korea (no free trade - buy local). So the underlying assumption of the MCC Legend editorial is false - it can be empirically disproved. See the 100 mile suit by Paul Adams for a humorous illustration.

Illusions in the MCC Legend editorial include the notion that locally produced foods are lower priced, of higher quality and are in demand. As the food shopper in my family I would challenge the editorial writer to explore the illusion that farmers market products are cheaper than similar products found in grocery stores. I have shopped both and consistently found lower prices in grocery stores. This illusion could be converted to a theory and then to either fact or falsehood. It merely takes reporting - select a product, say tomatoes, then compare prices at Frys, Safeway, WalMart and the local farmers market. I wonder if any other reader laughed out loud at the quote regarding tomatoes: "You can get them at Fry's, but (produce) is not pulled fresh off the vine there,"-I wonder what is fresh - the farmer pulled a tomato off the vine early on a Sat morning to sell that afternoon, I have purchased tomatoes at Fry's still on the vine.

This all said, a free and open society maximizes opportunities for participants. Some (actually very, very few) "locally produced" products are available in a developed and free society like Arizona consumers are free to purchase these items. While Arizona does produce excellent lettuce, tomatoes and oranges, our state does not produce bananas, kiwi or coffee. As an aside, I wonder if the editorial writer attempted a price comparison on similar drinks at Starbucks and Gold Bar - she would be surprised to learn the locus of the lower price. That said, the existence of Gold Bar, farmers markets, online business that tout local crafts attests to the fact that some consumers are willing to pay a higher price for a local product. The existence of WalMart, Nordstroms, Safeway and Starbucks attests to the fact that the vast majority of consumers freely act on their own knowledge to increase their own standard of living and that of their community act to purchase goods from around the world. In fact, most consumers use criteria other than location of production in their calculus prior to purchase. And in a free and open society this diversity is to be applauded and encouraged.

Student journalists have the opportunity to get it right while in an academic setting - I applaud the editorial writer of the Legend for expressing views protected under our long standing tradition of free speech. Free speech is designed to protect illusion, myth and falsehood and clearly most of our population is experienced at voicing opinion. It is my hope that this journalist will explore the role of news reporting - which is central to the development of all types of knowledge and a key institution supporting free exchange.

Adams, Paul "The 100 mile suit wears its origins on its sleeve"
http://www.wired.com/culture/design/news/2007/03/100milesuit0330

Australian Government "The role of growth, trade and aid"
http://www.ausaid.gov.au/keyaid/growth.cfm

Center for Economic Policy Research "Economic Growth: Free Trade Effects"
http://www.cepr.org/pubs/Bulletin/dps/dp1183.htm

EconTalk "Boudreaux on the Economics of Buying Local"
http://www.econtalk.org/archives/2007/04/boudreaux_on_th.html

Science News "Buying Local is Not Always Better for the Environment"
http://www.sciencedaily.com/releases/2009/02/090202113553.htm

Selick, Karen "The Buying Local Fallacy"
http://www.econlib.org/library/Columns/y2008/Selicklocal.html

Shaw, Amy "Is Buying Local Really Good?"
http://www.worldchanging.com/local/newyork/archives/005987.html

Smith, Adam The Theory of Moral Sentiments

Smith, Adam The Wealth of Nations

Sowell, Thomas Knowledge and Decisons