Vitalik Buterin
Jan 13 · 2 min read

I think there’s an is-ought dichotomy here that’s being missed. Yes, it is true that, within the current economic structure, lambos are not being produced much because their resource cost is high, and public goods are not being produced much because of coordination difficulties. However, the first reason is a good reason not to produce too many lambos; it’s actually not a good decision for society to spend lots of resources producing things that people are not willing to spend lots of resources to acquire. The second reason on the other hand is not from a social perspective a good reason to skimp on public goods, rather it’s a failure of social mechanism design. If an Ideal Dictator God (to use David Friedman’s term) were to force everyone to spend more resources on public goods, everyone would be happier; if the same Ideal Dictator God were to force everyone to make more lambos, most people would be worse off.

Another way to see this is to consider a world where different social norms and laws were enforced, worse ones than the present: imagine a world where there is no private property, and anyone can use any item if they see it. Lambos would become common goods (not quite public goods as they’re rivalrous, but similar), and so whoever produces a lambo would not enjoy it much before someone else grabs it. In this world, do you agree that lambos would be underproduced (along with a bunch of other super-important stuff like food)? If so, you agree that “underproduction” in the economic sense is a valid concept; if not, then it seems hard to argue that not enforcing private property is inferior.

    Vitalik Buterin

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