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Old 02-28-2018, 08:50 AM
 
Location: Paranoid State
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This is an interesting economics thread. It really goes pretty far beyond undergraduate econ into the fairly specialized world of General Equilibrium Theory. https://en.wikipedia.org/wiki/Genera...librium_theory. Gerard Debreau https://en.wikipedia.org/wiki/G%C3%A9rard_Debreu won the Nobel Prize in 1983 for his pioneering work in General Equilibrium. This is some pretty tough slogging to understand it - it is advanced mathematical economics.

Quote:
Debreu began working as a Research Associate and joined the Cowles Commission at the University of Chicago in the summer of 1950. He remained there for five years, returning to Paris periodically.

In 1954, he published a breakthrough paper, entitled Existence of an Equilibrium for a Competitive Economy, together with Kenneth Arrow, in which they provided a definitive mathematical proof of the existence of a general equilibrium, using topological rather than calculus-based methods.

In 1955, he moved to Yale University.

In 1959, he published his classical monograph, Theory of Value: An Axiomatic Analysis of Economic Equilibrium (Cowles Foundation Monographs Series), which is one of the most important works in mathematical economics.
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Old 02-28-2018, 08:54 AM
 
Location: Ruidoso, NM
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Originally Posted by SportyandMisty View Post
And I agree with you : efficiency is a key strategic advantage for many (but not all!) businesses.


Good post! Lack of competition is what kills efficiency.
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Old 02-28-2018, 09:19 AM
 
Location: Aurora Denveralis
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Originally Posted by craigiri View Post
Even these days in "retirement", I tend to look at the equations of efficiency.
You're looking at my comments with... a prefocused view. Why do your notions of "efficiency" and doing productive things have to be a basis for an economy? You are already well into a mode of doing efficient, productive things that have nothing much to do with your personal economics. Why not extend the idea to a economy that is (1) not based on worker incomes and (2) promotes useful, efficient, productive things for their own sakes?

Quote:
Originally Posted by ohio_peasant View Post
As to the second line of reasoning, that materialism is a fool's errand, well, here I disagree quite vehemently. A contemplative life isn't really attainable, unless you already are well-fed, warm, and healthy... and all of that takes money.
Again, kind of a sideways view. If anyone in this thread (or most other recent ones) has said "we need to abandon material things and still on a hilltop contemplating sunrises" - it wasn't me. One of my base ideas is that every individual should strive to be the most they can be, in whatever direction lets them be that "most"; any person who chooses to be completely idle is opting out of the game and irrelevant. My major contention is that that "productivity" and accomplishment and so forth do not need to be tied to an income-producing job, and that collectively we could achieve far more if the two were separated. Since we're pretty much bound to one part of the change, we may as well embrace the other.

But none of this is based on some kind of idiotic minimalism or collective ownership of sackcloth shifts and gruel bowls or whatever - humans are innately consumers, and almost as innately materialistic. But there is a better balance to both than we have had for many decades, if not longer.

Put even more simply, life is about more than how much sh*t you can pile up around yourself (whether it's smartphones or real estate); it's time to turn that from a vaguely admired ideal to a reality.
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Old 02-28-2018, 09:57 AM
 
Location: Ruidoso, NM
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Originally Posted by Quietude View Post
Why not extend the idea to a economy that is (1) not based on worker incomes and (2) promotes useful, efficient, productive things for their own sakes?
Productivity is the measure of how much aggregate work it takes to produce something. The quality of infrastructure, efficient institutions and regulation, and the intelligent application of technology are the main contributing factors. Tech is the reason we've see huge gains in the last 200 years, and very little in the millennia prior.

Where living standards are concerned, productivity is it.

Note that hours of work are in the denominator, so we could work less and just have less. But you also need to consider the effect this would have on infrastructure and investment if this was the case.

Many countries are doing quite well with less work though. Look at those German slackers!





Quote:
any person who chooses to be completely idle is opting out of the game and irrelevant.
“All of humanity's problems stem from man's inability to sit quietly in a room alone.”

― Blaise Pascal, Pensées
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Old 02-28-2018, 10:09 AM
 
Location: Aurora Denveralis
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Quote:
Originally Posted by rruff View Post
Productivity is the measure of how much aggregate work it takes to produce something. The quality of infrastructure, efficient institutions and regulation, and the intelligent application of technology are the main contributing factors. Tech is the reason we've see huge gains in the last 200 years, and very little in the millennia prior.

Where living standards are concerned, productivity is it.
Econ 101. No argument. But also a case of a somewhat arbitrary construction of economic elements. Like Tinkertoys, you can use economics elements to build pretty much anything, and some of them even Really! Work! Kids!!!

I propose building something completely different, from much the same pieces, but adapted to the reality of the next half-century and beyond. If we're going to get shoved off a cliff, we might as well give ourselves wings. Instead of heavy golden slave collars.
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Old 02-28-2018, 10:16 AM
 
8,281 posts, read 3,454,476 times
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Quote:
Originally Posted by craigiri View Post
There is a famous speech from long ago by Bobby Kennedy:

https://www.youtube.com/watch?v=77IdKFqXbUY

and, of course, most are familiar with the famous speech given by IKE detailing what the Military Industrial Complex money SHOULD BE BUYING (schools, hospitals, etc.).

I'm fairly good at understanding economics - owned and ran businesses for 40 years. In addition, I am well versed in history and current events...and yet I cannot understand the USA's current focus on increasing GDP. I can see why it might be important for a developing country as a way to measure growth. But in a country as developed as ours, it's really hard for me to see increased GDP as a good thing.

I'm sure someone with more smarts can talk me down from this, but here are a number of examples of why. Note that these examples cover TRILLIONS of dollars of expenditures, so they are not some sideline of the economics involved. My "alternative answer" is that efficiency is the name of the game of the present and future and that means more for less. If we spend less, then GDP is less, right? Examples:

1. We are paying the highest rates in the world for health care - reaching almost 11K per person per year. That money being spent is all GDP, right? So if we had a system that was closer in cost to some country (which get better results, live longer), our GDP would be lower.

2. If I trade in my Subaru for a Prius (even trade) and get 2X the MPG, I will buy 1/2 as much gasoline this year. That will lower GDP (when taken times tens of millions of vehicles).

3. If our "Security State" which has grown massively in the last 15 years...was cut down to the true size needed without watching every word and action of every square miles in the entire world (and every sq ft in this country) - this would also lower GDP.

4. If, instead of owning a tablet, computer and smart phone ($4K not so long ago) I own just a large Phablet, GDP is cut down as well as electric use (GDP also). In fact, every efficient device we all own cuts down the amount we pay for the fuel(s), and therefore lowers GDP.

5. If Trump gives away 1.5 Trillion dollars out of debt and deficit, some of that money will be spent on things which increase GDP. But there is no "other" side of the equation for the debt, deficit and interest on all of it.

Again, my takes is that the future (in the entire world, let alone the US) belongs to the efficient...and, almost by nature, efficiency means more for less. There are many other similar situations in our everyday lives - cooking at home and watching Netflix lowers GDP vastly over eating and drinking at a local establishment and then catching a movie. IMHO, not only does efficiency save money and resources, but it creates a better society overall (less traffic, pollution, waste, etc.).
GDP is simply a number, to be compared. Inflation adjusted GDP maybe a bit better, but still just another number.

But the key that may be more important, is standard of living. And that is hard to put a number on.
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Old 02-28-2018, 10:33 AM
 
Location: Ruidoso, NM
5,170 posts, read 4,731,643 times
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Quote:
Originally Posted by Quietude View Post
I propose building something completely different, from much the same pieces, but adapted to the reality of the next half-century and beyond. If we're going to get shoved off a cliff, we might as well give ourselves wings. Instead of heavy golden slave collars.
"Golden" slave collars?

There is no question that we can run our economy pretty much the way it is now, with less work, provided that the "goose" isn't killed that makes it possible (productivity). In fact you'd want that goose to be happier and healthier than ever.
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Old 02-28-2018, 10:34 AM
 
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Originally Posted by Quietude View Post
...If anyone in this thread (or most other recent ones) has said "we need to abandon material things and still on a hilltop contemplating sunrises" - it wasn't me.
How about this:

Quote:
Originally Posted by Quietude View Post
...My perspective is that an continually increasing economy is stupid and self-destructive, ....
To continue...

Quote:
Originally Posted by Quietude View Post
One of my base ideas is that every individual should strive to be the most they can be, in whatever direction lets them be that "most"...

One of my base (in both senses of the word) ideas is that most people are utterly incapable of individual self-fulfillment. Instead, they need to be corralled and shepherded, whether by a church, a military, a corporate employer, or a strong centralized government. Most people are indeed capable of productive things, albeit perhaps at a mundane and rote level. Some are capable of advanced math or physics, but would be lost if not given steady employment and tasks at said employment. What's necessary is to lead them.

Quote:
Originally Posted by Quietude View Post
Put even more simply, life is about more than how much sh*t you can pile up around yourself (whether it's smartphones or real estate); it's time to turn that from a vaguely admired ideal to a reality.
Oh, I fully agree, that rampant consumer materialism is facile and gauche. I would much rather live in a society that builds elegant cathedrals and monuments, even if the peasants live in mud-huts, than a society of tidy single-family homes on leafy suburban streets, but with no cathedrals or memorable civic structures etc. I would much rather live in a society where chess players and landscape-painters and mathematicians and violinists get lavish state-scholarships at public expense, than one where everything is strictly private, and the brightest people go into finance, because the thing that's most valued is the sheer making of money. But all of this culture-stuff, all of this Mathew Arnold sweetness-and-light stuff, requires money. It requires a sophisticated system of private corporate vitality and strong central government, to generate excess revenue to be devoted to archival pursuits.

I also think that for a system to be stable, it has to grow. We need more-more-more, not from rapacious desire to dominate, but because outright stability is impossible. We need return on invested-capital, for otherwise the above-mentioned artsy-stuff can't be funded. Where I depart from the Milton Friedman-style libertarians, is that I'm convinced that grand cathedrals are not possible merely by private investment, because there is no private incentive to invest in such things. They require a strong central government to impose dictates of taste and civic virtue. Where I depart from straight statists, is that I'm convinced that private enterprise is necessary for innovation and for sustained return-on-capital.

Now, if only we had a modern-day Herbert Croly!
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Old 02-28-2018, 10:45 AM
 
Location: Ruidoso, NM
5,170 posts, read 4,731,643 times
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Quote:
Originally Posted by ohio_peasant View Post
I also think that for a system to be stable, it has to grow. We need more-more-more, not from rapacious desire to dominate, but because outright stability is impossible.
Rather I'd say that anything besides growth would be a serious failure, while tech advances keep making growth possible.

Growth= doing things better, with less work. This is not analogous to GDP, though the odds are good that they will trend in the same direction.

Quote:
I would much rather live in a society that builds elegant cathedrals and monuments, even if the peasants live in mud-huts, than a society of tidy single-family homes on leafy suburban streets, but with no cathedrals or memorable civic structures etc.
If you were a peasant in a mud hut, I'm not so sure you'd hold that view....
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Old 02-28-2018, 10:58 AM
 
Location: Aurora Denveralis
2,999 posts, read 1,017,500 times
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Quote:
Originally Posted by rruff View Post
"Golden" slave collars?
Yes. They're very stylish. That's why we spend so much time admiring each others'.

Quote:
Originally Posted by ohio_peasant View Post
How about this:
Okay, I am not going to try and do multiple layers of quoting here, so let's just assume context.

If you equate my saying "Continual GDP growth is nonsense" with "let's all go sit on the mountaintops" I don't really know where to take the discussion. I have found that people utterly walled in by conventional economic thought are best left to their own... thoughts.

Quote:
One of my base (in both senses of the word) ideas is that most people are utterly incapable of individual self-fulfillment. Instead, they need to be corralled and shepherded, whether by a church, a military, a corporate employer, or a strong centralized government. Most people are indeed capable of productive things, albeit perhaps at a mundane and rote level. Some are capable of advanced math or physics, but would be lost if not given steady employment and tasks at said employment. What's necessary is to lead them.
For someone who thinks the only effective carrot is a paycheck, I can see why you think all that.

I disagree in all but the broad notion that most people do need motivation to reach significant levels of achievement - but that there are far more effective motivations than making them fight for their daily bread.

Quote:
Oh, I fully agree, that rampant consumer materialism is facile and gauche.
So do I, but in the same way that I think bright pink garbage trucks are ugly. It's kind of beside the point. My position is not that it's awful, just awful that someone has three Mercedeses (? plural there? ) in their driveway... but that as a population we nearly all have such excess, nearly all of which is deeply rationalized as "need." The problem here is not something idealistic, but that we simply can't do it any more - not and survive as a nation, a globe of nations or a planet. We must adapt or pay a nearly K-T event price.

You're on the right track with the rest of that paragraph, but still tied to the notion that all those poets and painters have to be subsidized with the sweat and effort of 'real working people.' Keep at it.
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