My old Professor Frank finds another justification for raising taxes on the rich: high tuition.
Maybe you can share some thoughts on the part of the article in which Frank discusses Baumol’s cost disease. I recall that you didn’t think that it’s a severe problem.
What a spectacularly bad analogy. The members of Caravan Palace can electronically produce an outstanding piece of music, record it in any number of formats, and it can be played at any time, anywhere in the world for free. Go ahead and listen to them here: http://youtu.be/9BoaOsvZmpw
Baumol’s cost disease? I am ignorant, but it sounds like a good theory, combining those words. Looking forward to a full exposition from you, Dan, Chuck, and Wintercow. Bet the disease is everywhere.
Baumol’s cost disease: financing the performing arts is difficult because while everything else in the economy sees rising productivity gains, it’s hard to improve the productivity of performers. It took nine minutes to play Beethoven’s fourth string quartet in 1800, and nine minutes to play it now, and preparing for the work is about as difficult then as it is now. So costs in live performance will rise relative to costs in the economy as a whole because wage increases in the arts have to keep up with those in the general economy, even though productivity lags.
Changing the subject a bit, but following the same principle, how come the movie industry produces seventy duds per year, three movies worth seeing, and rarely one that one that you want to watch more than two times? Talk about shoveling mountains of money down the memory hole, with all that talent and effort. I am not taking a shot here at liberals here. With all that talent pursuing so much money, why is it all so mediocre?
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