My friend (although we’ve never met) and fellow economist Jon Murphy stated recently, in a comment on co-blogger Pierre Lemieux’s recent post:
When there are two options moving you away from your desired path, choosing the one that moves you away slightly slower is not really any better.
I challenged Jon, writing:
Yes it is. Think on the margin.
Jon is great at thinking on the margin. I thought he would agree. But he didn’t. Instead he wrote:
I am, David. My point is that both options as presented lead me further away from my goal. That implies it is time to search out a new margin or do nothing.
Commenter Vivian Darkbloom came in on my side of the issue, writing:
Being on the 30 yard line is not the same as being on the 10 yard line!
To which Jon responded:
Agreed. But when my goal is to be in the endzone, one play that drops me back to the 40 and another that drops me back to the 50 are both counterproductive.
Yes, both are counterproductive, but in economics we often compare two bad alternatives and choose the less bad. Thinking on the margin works here too. 40 is closer than 50.
Now, if Jon had argued that the two alternatives are no different, then he would have a point. But he made quite clear that that’s not what he’s arguing.
Note: Pierre raises another issue in the comments, in response, and it’s a good point for Pierre to make. But it isn’t relevant to my response to Jon.