Apparently economic theory and policy as practiced and embraced elsewhere differs from local practice so let me try to articulate how to practice our own unique brand of microeconomics. For our purposes, ‘micro’ refers to the city of Amsterdam in zip code 12010. Fair warning: this should only be practiced in 12010:
– Demand sucks: If demand for a product creates a rise in price, demand should be suppressed or buyers driving demand should be discouraged. For example, if a property auction yields multiple buyers for the same property creating higher prices, the low-bidders have a sound argument to decry the need to pay more for their desired good. Therefore, we should encourage lower prices by removing buyers willing to pay more from the auction.
–Demand sucks more: If demand for as-to-date rundown and derelict properties increases with a resulting loss of stock for demolition and landfill, economic policy dictates that this demand must too be diminished. Demand should never deter supply when it comes to demolition and landfill.
–Demand sucks totally: If demand for housing in 12010 increases, that means prices would rise. Then how can people afford to buy a home if prices rise? Therefore, demand must be discouraged so prices remain low or decrease so people can afford houses.
–Codes enforcement drives demand: You would think market forces of supply and demand would drive investment in local real estate. However, economics 12010 states that strengthened codes enforcement mandating higher fees and burdens on homeowners and investors will drive prices up especially when overall quality of life and services are diminished at the same time. You see, we have derelict properties not because of economic forces but strictly due to lack of codes enforcement. So how do you counter disincentives to invest and buy local property: you add additional costs to heighten disincentives. Counter-intuitive but brilliant policy and analysis nonetheless.
–Dollar Inequality: A dollar spent by a 12010 resident is inherently worth more than a dollar spent by a non-12010 resident. Or its corollary: an English-speaking dollar worth way more than English-as-a-second-language dollar.
–Magical Dollars: The dollars to pay for infrastructure and other priority programs which originate in a magical forest somewhere in 12010. While not clear on what they are, here is what they are not– local tax dollars. As such, they must not originate in 12010 while to its believers, they must also not originate from non-12010 sources as that suggests an embrace of socialism or worse. Hence, they must magically appear from a source unknown.
–Super Magical Dollars : A dollar spent on something falling under a claim of ‘shared services’ is not a dollar spent at all. You may not see the dollar in your wallet, but is actually still there; you just can’t see it. In some cases, Super Magical Dollars make future dollars in your wallet disappear but no worries: they’re still there, you just can’t see them.
–Tonko Dollars: An evil, pernicious dollar to be avoided at all cost.However, local alchemists believe Tonko Dollars may be transformed into Magical Dollars.
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