Economist Writing Every Day

Economics is everywhere, but I find endless enjoyment in watching others learn about economics in unexpected places. In this case, it’s in the largest Dungeons and Dragons subreddit, where a particularly long-playing and supremely powerful group of adventurers get the bright idea to institute a tax…on magic. What could possibly go wrong?

Well, that is precisely the discussion that emerges. All the things that will and should go wrong if you decide to place a tax on what is essentially the wellspring of all technology and welfare in their world. All healthcare, production, sanitation, agriculture, public safety, etc etc. It all comes back to magic. And these hearty and hale adventurers think it would nice to rake in a few extra million gold pieces by placing, and presumably enforcing, a tax on it.

What’s fascinating is to walk through the comments and watch the crowd collectively puzzle out all the ways this is going to backfire, only to then march through ways the world is going to collectively respond and eventually rebel. There’s a reason why most tax discussions eventually become, at the very least, targeted and, at their very best, highly nuanced. Because it is no small decision how a society should best leverage taxation as a means to solve a problem. Do we want to tax the rich? Ok, what’s the line at rich? Do we want to eliminate regressive taxes targeting the poor? Ok, but is this only a tax or is it doing something else as well?

In this world of magic and mayhem, we see our heroic players stumble into literally the worst possible thing you could ever tax: the entire body of technology. Not labor, not capital, not income, not capital gains…no, they target the single most important input into all of economic growth and human welfare. From a pedagogical point of view, this is <chef kisses fingers> perfection. Absolutely no notes. I’m not kidding when I say that, if I was still teaching Principles of Economics, I would build a class discussion around this exact thread.

And special shout out the commenter to worked through the economic, political, and ecumenical consequences in real time:

It’s economics all the way down, apparently even into the depths of The Nine Hells.