Welcome to Econ Talk, part of the Library of Economics and Liberty. I'm your host Russ Roberts

of George Mason University and Stanford University's Hoover Institution. Our website

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find links and other information related to today's conversation. Our email address is

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My guest today is Don Boudreau, my colleague here at George Mason University where he is

the chairman of the economics department. And Don and I co-host the blog Cafe Hayek. And

a reader of that blog, Joel Turner, asked us to comment on the potential virtues of buying

a local. This idea that it's better to buy from, say, your local hardware store rather

than a national chain and extending the logic better to buy from an American company

rather than a foreign company. I thought it would make a good podcast topic. Don, welcome

back to Econ Talk. My pleasure. So what do you think of this idea? It seems there's

a certain superficial appeal. It seems like a good idea. I think the argument of the defenders

of the idea is that when we buy from, say, a Virginian, the money stays in Virginia. When

we buy from an American, the money at least stays in America. When we buy from a foreign

or the money goes overseas. So it's better to buy from an American that a foreigner,

it's better to buy from a Virginian than a Marylander and presumably by that argument,

it's better to buy from a fair faxian, somebody who's here in Fairfax where we're located

at George Mason rather than someone from across the state in Roanoke. Any truth to those

arguments? No, none at all. My great teacher of international economics at NYU years

ago, the late Fritz Moclub once said that in class, he said that all these protectionist

arguments are these buy local arguments. If you take them seriously, they reduce to

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