Wednesday, 25 June 2014

Agglomeration benefits in the movies

Rich Tee mentioned No Batteries Included in the comments at The Stigler's post about films where the general theme is Noble Small Landowners battling with Evil Developers.

The plot twists are right at the beginning and at the end:

Frank and Faye Riley (Hume Cronyn and Jessica Tandy), an elderly couple who run an apartment building and café in the run-down East Village neighborhood, come under threat by a nearby property development. The development manager sends a hoodlum named Carlos and his gang of thugs to bribe the couple and their tenants to move out…

OK, so Frank and Faye are just small rent collectors competing with a larger rent collector; this is not good-v-evil, it is slightly evil-v-very evil, and being fair to the Evil Developer, at least he starts off by offering them a ransom payment...

Fast forward through the shenanigans where the counter parties commit various criminal offences to frighten each other off…

The story then rolls on to an undisclosed period some years later in the future, revealing that skyscraper developments have eventually been built, but this time flanking either side of the tiny apartment building, with Frank's café now doing a roaring trade as a result of the new employment brought into the area.

So in the end, the small rent collector ends up getting his ransom payment ten times over by reaping the agglomeration benefits; which is exactly what the hero in Once Upon Time In The West was gambling on but gets killed for.

3 comments:

DBC Reed said...

The daddy of them all is "Its a Wonderful Life" which as a leftie I'm supposed to like. But as a child I was transfixed by the Pottersville sequence which seemed like a huge improvement especially the boogie-woogie piano in the bar (from an uncredited Meade Lux Lewis apparently).
I should imagine Kansas City under Boss Prendergast was bit like this with the Blue Devils, Count Basie etc. Loads of corruption.Harry Truman developed his political style here.

Blissex said...

«just small rent collectors competing with a larger rent collector; this is not good-v-evil, it is slightly evil-v-very evil, [ ... ] So in the end, the small rent collector ends up getting his ransom payment ten times over by reaping the agglomeration benefits;»

But that is the dream isn't it? The middle class dream, the American Dream, the Thatcher Child Dream: to make money fast by speculating to get huge tax-free capital gains redistributing income from "improductive" (immigrant, Northern) workers to "productive" (native, Southern) rentiers.

It is the "FUCK YOU! *I* got mine" (USA) dream, the "Blow you! I am allright Jack" (UK South) dream.

It is what for politicians in the UK is called "aspiration": the aspiration to become mean, greedy landlords of the manor thanks to political favours.

The aspiration to retire at 50 to a villa in France thanks to owning a shop in what has become a prime location in Notting Hill, a shop where some immigrant loser from Hartlepool (or Krakow) works 12-14 hour days at minimum wage and where the owner comes back from France once a month for a proprietor's inspection.

All your sound arguments have no power against such dreams, and politicians know that very well.

Mark Wadsworth said...

B, yes, that is the dream, but clearly only a minority can ever fulfil it at any one time, for every winner there are four losers.

Conversely, it is quite possibly to imagine an economy with no landlords whatsoever (i.e. with full-on LVT instead of taxes on income) which common sense tells us must be a healthier economy (more people doing more stuff, so more wealth, and also less disparity of wealth).