Talk:Economics Debate Guide
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Hello everyone,
I am a member of the London Philosophy Meetup group and new to this wiki. I think wikies are the best thing since HTML.
Anyway, I feel that another important division (not jus a minor one) of economics is Normative and Positive.
It is a serious problem that Positive economics is by far the most favoured mode of economics in Academia.
I think that the entry on [money] is a statement from positive economics.
If we ask "Where does money come from in the first place?", we are looking at quite a different, and much more interesting, aspect of economics.
Janos 17:36, 12 August 2006 (CDT)
Contents |
"Mainstream" Economics
Mainstream economics is a neutered version of classical economics.
The fundamental factor (land/nature) has been made to disappear from economic awareness by hiding it in the "capital" category. Hence, modern economic theory cannot comprehend the environmental implications of the way we, as a species, make a living.
Only by mixing the human element (labour) and its creature (capital) with the creative forces and agencies of nature can we provide for our needs.
Without the "free inputs" from nature all modern economic life would stop. Taking nature for granted, our economic behaviour is the main culprit behind environmental problems. By reinstating Land as a third factor, economic theorising would be forced to treat environment degradation as an internal cost.
Failing this, society at large has to incur the cost of inefficient external regulation and enforcement.
Janos 18:26, 12 August 2006 (CDT)
Janos, if you have ontological recommendations for economics, we are very open... Jcb
Thanks for this encouragement.
Price formation
Economic theory seems to miss (or dis-miss?) the existence of two entirely different economic processes when discussing the nature of prices and price formation.
There is a price that is
- made up of the cost of inputs used up, plus a compensation for effort and risk contributed by producers,
- and another kind of price that is entirely the result of demand without any "cost of production" element.
The "price" of land (or location) is the classic example of the latter type. Land, itself, has no cost or production in its natural state, yet in the center of a big city it commands enormous prices (millions of pounds per acre).
In fact, this ties up with the problem in economics caused by not recognising land as a major element in economic reckoning. In fully developed economies land is a limiting factor because its supply cannot respond to demand. For example, London's housing problem is, in fact, a land problem. Normally, the building industry would respond to increasing demand by providing more accommodation units; but it cannot produce more plots on which to build them. --Janos 15:27, 25 February 2007 (EST)
Taxation
Taxation policies are also greatly distorted when economic theorising is blind to the nature of land as a major requirement underlying economic growth (or lack of it; but leave that for another day).
Janos 14:37, 13 August 2006 (CDT)
Ricardo's Law
Ricardo's name is most often associated with
- the notion of "Comparative Advantage" and
- The theory of "comparative advantage" depends on a basic necessary condition. That is, capital from one country cannot be moved to the other country (capital immobility). (this must be an embarrassing caveat to advocates of headlong and unregulated globalisation.)
- the "Iron Law of Wages".
- His argument was that wages "naturally" tended towards a minimum level corresponding to the subsistence needs of the workers. That is, "if it didn't have to, a company would pay a worker no more than the amount required to feed him and beget his replacement."
- A less well know "Law" defined by Ricardo is
- the "Law of Rent".
- It was the first clear exposition of the source and magnitude of land rents, and is among the most important and firmly established principles of economics.
...as neoclassical economics was being formulated, it was realized that the classical definition of rent made the non-contributory nature of the landowner's participation in economic activities rather too apparent... Wikipedia
And the rest, as they say, is history. Land, and its ebarrasing tendency to give enormous uneardned benefits to "land owners", had to disappear from economics.
Janos 16:43, 25 February 2007 (EST)
