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Jason George tackles the intricacies of tariffs and taxes and discusses the potential of a fair system that takes into account concentrated benefits and diffuse costs while dealing with the interests of the few vs. the masses.

Observers who dig even a little into government policy in areas like tariffs or taxes might note some peculiar features. Regulations are often crafted to provide benefits to a favored constituency, while the corresponding costs are borne by the broader population in some opaque way that individuals can’t discern. As a result everyone ends up paying slightly more for healthcare, or cars, or chocolate bars, while the folks who sell those things get some economic protection.

Topics covered include:

-The handshake problem

-Hidden group costs

-The cumulative effect of multiple narrow interests

Read the full article, The Collective Action Problem and True costs, on Jason’s website.