At $500 a night, your comment appears to be false. Additionally, the people that live there will have a harder time competing with people who can afford to live there part time at accelerated rates - which means, on average, the place next door is threatening to drive up rent everywhere around it.
You can't say I'm false and justify it by citing a single price. What would a hotel have cost?
I don't understand your second point at all. But remember, prices are "set" by firms competing for the lowest price/best value, not by "what the market can bear." There should be no reason rents will go up.
Why compare it to the average? This is a $8,000 a month apartment. A hotel room equivalent would definitely not be $281. More importantly, if this wasn't a good deal, why explains it being booked all the time?
That is the consumer surplus for his customers. The criminal vendor and his customers are always individually better off, or else no transaction would take place.
Society suffers from the externalities of a criminal business.
Your logic is flawed. This business is not zero sum. It literally creates wealth. Your dollar now buys more than it did before. Taxation is zero-sum. Your dollar that you would have spent literally gets taken from you to be spent somewhere else. No wealth is created. Similarly, no wealth is lost when people evade tax - but we do have less for the government to spend obviously.
Also, at a large scale "the customers" are the same as "society."
Externalities are an important topic but what are those externalities? Fewer tax dollars, annoyed neighbors, that all I can think of. Both of those are easily solvable problems in a free market. Allow apartment complexes to choose if they allow airBnB.
The benefit far outweighs the negatives. There are also positive externalities. We all benefit from sharing our resources.
Air BnB should be legalized. That would also get rid of some of the externalities of crime, like paying for prison and enforcement of laws.
If taxation is used to create infrastructure, then surely it is not zero-sum. Also, examples such as NASA would suggest that certain tax funded activities are hugely positive-sum. http://er.jsc.nasa.gov/seh/economics.html
Government is positive-sum (in theory - if used correctly). Taxation is not. If taxation was positive-sum we could just tax everyone 100%, give it back to them, tax it again, and all be incredibly wealthy!
Building roads is important and benefits society, but regardless taxation is still zero-sum. Taxation is just a funnel of inlets that eventually go to a bunch of outlets. The money in equals the money out. Nothing was created. benefit = the amount. Zero-sum. The government can spend it on things that are positive-sum, but so can we.
Now, lets take roads again, the economic benefit of roads is much much higher than the amount it takes to build and maintain them. Roads create wealth. But taxation is still zero-sum. We as a bunch of private individuals could have paid to have the roads built for all intents and purposes the same price the government can. Obviously that's impractical so we don't do it that way. The positive-sum of government is exactly this -- the organization of community projects among other things.
It's a difficult idea to wrap your head around, I know. The government can invest tax dollars, but so can you. Taxation, regardless of what it is spent on is inherently zero-sum by definition. That said, plenty of zero-sum things are incredibly important and worthwhile. Taxation is one of these things.
> It's a difficult idea to wrap your head around, I know. The government can invest tax dollars, but so can you. Taxation, regardless of what it is spent on is inherently zero-sum by definition.
I think you're defining taxation so narrowly as to be meaningless. One could equally argue that buying something in a shop is inherently zero-sum - your money goes to the shopkeeper, the product goes to you, by definition that's zero-sum.
With more usual definitions we'd say that was a positive-sum trade, because to you the product is worth more than the money, while to the shopkeeper the reverse is true. But the exact same reasoning can apply to taxation - taxation is positive-sum for most people, precisely because it is more valuable to them for that money to be in the hands of the government than for it to be in their own hands (because, as you say, the government can use it more efficiently, because it can undertake projects that while positive-sum are impractical for private individuals).
Trade of dollars and unmodified material goods is also zero sum in those dollars and goods, and can still be positive-sum in utility.
If you have X kg gold, and I have $Y, and you value that X kg gold at less than $Y, while I value that X kg gold a more than $Y, we can make a trade, all be subjectively better off - a non-zero sum transaction - and yet there is no more gold and there is no more dollars.
