Re: colonial weapons

On Thu, Jan 31, 2002 at 07:59:56AM -0500, Richard and Emily Bell wrote:
>Economic theorists have a way of describing these situations: 
Producing the
>goods cost more than X (the cost of lost opportunities is not an
accounting
>fiction).  If it really was cheaper for the importers of the goods to
make it
>locally, they will maximise their profits.

Yes. I've been a professional economist... :-) I didn't see any point 
in using specialised language here, though, when normal language could 
describe the situation adequately.

>Importers have to be careful when importing these goods; unless, order
cycles
>are short.  If a good *could* be made cheaper locally, but isn't, there
is
>likely a very good reason.  The most likely one is that the possibility
of
>the market drying up is high.

Yes; I certainly wouldn't want to claim this will always happen. Like
most simple economic theories, this one works best with commoditised
goods - i.e. the thing made by one manufacturer is indistinguishable
from the thing made by another. (Where we've been talking about
miniatures, this is true - they're the same miniatures. But any branding
or advertising distorts the situation, which is very likely to be the
case in your stuffed toy example.)