Mandatory efficiency

Doug Altner poses an interesting question on the Voices of Reason blog:

If energy-saving appliances are so good for businesses, then why must officials like Moniz force appliance-makers to produce them?

One reason might be that cost savings are uncertain and it is difficult to persuade customers to invest in achieving those savings, so mandating them across the board helps get it done. This forced risk-taking though is deficient: if the people in the know find that they don’t know if it will work then we should expect that in most cases it will not.  So at best appliance (or car, or computer) design mandates transform wasted energy into wasted money. If you’re a member of the Green Party you might cheer at this, but considering how much effort might have gone into earning that currency this is not only an assault on individual rights but also implausible as an environmental protection measure.


But surely reducing waste is a value? We can assume that it often is, and when businesses perceive it they will address it – if returns are achievable. For example, my wife recently launched 1MenuBook, a collection of restaurant menus in a book for delivery or take away purposes.

Despite the name, there are 4 editions for each of four neighbouring postcodes in South East London, which we distribute to match the delivery areas of the featured restaurants. We save a little paper and ink, but also distrubute, in each copy, between 7 to 15 different menus that would otherwise have been distributed by 7 to 15 different people. That’s a lot of time, calories and shoe-leather we’re saving restaurant owners. We did not do this for environmental reasons, or to help reduce “costs to society” we did it so that we could pocket a portion of the waste for ourselves, and a portion of the extra revenue a book creates over individual menus.

Yes carbon emissions are reduced, and trees are saved, and a whole lot of intensively farmed calories are not burned (door to door delivery is a great workout) but it was not necessary to co-ordinate any of that centrally or even to give any thought to it. It happened because an entrepreneur wanted to do it, for their own sake, and if it is not efficient it is they that pay the price.


  1. What if someone doesn’t care about efficiency? Or if someone actually wants to be wasteful? Would that justify State intervention?

    If “efficiency” is taken seriously then private property is abolished. If I can use a resource more efficiently than you can (according to…) then I must be made owner of that resource. The fact that you currently own it and don’t want to part with it is neither here nor there. To the more efficient, the spoils!



    1. You do make a good point. Arguments are like mobile networks, they each have certain coverage. Above, I made a Hayekian consequentialist argument, if I had drawn more deeply from Rand may have been able to head-off your alternative Devilish consequentialist equivalents.

      Thank you for helpfully illustrating one of the major (if momentarily neglected) themes of my blogging.



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