Re: Economics as a science (was Re: Double-stranded Economics)
Harry Pollard wrote: Tom, I'm doing some catching up of past posts I found interesting. You are right. That's why we must build our edifices on true assumptions. Harry Thomas wrote: Edifices built on false assumptions often lead to wrong conclusions which usually negate any possiblity of predictability. [snip] That does not, however, prevent them from defining ongoing and even expanding research programs, since iterative solutions to local problems can give the false appearance of progress toward an *overall* successful resolution, when it really is only getting further sucked into the hopeless endeavor. Wrong-headedness is far more dangerous than just being wrong. Yours in discourse \brad mccormick -- Let your light so shine before men, that they may see your good works (Matt 5:16) Prove all things; hold fast that which is good. (1 Thes 5:21) ![%THINK;[SGML+APL]] Brad McCormick, Ed.D. / [EMAIL PROTECTED] - Visit my website == http://www.users.cloud9.net/~bradmcc/
Re: Economics as a science (was Re: Double-stranded Economics)
Tom, I'm doing some catching up of past posts I found interesting. You are right. That's why we must build our edifices on true assumptions. Harry Thomas wrote: Edifices built on false assumptions often lead to wrong conclusions which usually negate any possiblity of predictability. Respectfully, Thomas Lunde ** Harry Pollard Henry George School of LA Box 655 Tujunga CA 91042 [EMAIL PROTECTED] Tel: (818) 352-4141 Fax: (818) 353-2242 ***
Re: Economics as a science (was Re: Double-stranded Economics)
Hi Keith: Just catching up on some old postings of yours and trying to make some comments. Your phrase, how economics can be used as a science. and the following phrase predictions made with a high degree of confidence:, are an assumption. Economics has not been able to develop a replicatible economy. There is no duplication of the experiment - therefore, economics remains at the most a theorm - a possibility that the study can eventually made into an experiment that is replicatble and therefore passes the scientific criteria. But not yet. Edifices built on false assumptions often lead to wrong conclusions which usually negate any possiblity of predictability. Respectfully, Thomas Lunde on 2/1/02 1:21 AM, Keith Hudson at [EMAIL PROTECTED] wrote: Hi Harry and Arthur, For the time being, let me take just one strand from your (HP's) latest mail and attempt to show how economics can be used as a science. This will never make the whole story at all times as we (HP and KH) both agree -- human nature is also involved -- but the overall structure over the longer term ought to be scientifically analysable *and* predictions made with a high degree of confidence:
RE: Economics as a science (was Re: Double-stranded Economics)
Harry, My point really wasn't about "gender sensitivity" but rather that, as the Feminist scholars have forced us to recognize (and as various other folks--notably Ray, have already pointed out)--words have meanings in contexts and that if we evoke a word we also evoke the context both in ourselves as the scribe, and in the reader -- and they need not (in fact are unlikely) to be the same. Formal Philosophy ( of the Linguistic Analysis school) made mince meat of the Germans (Hegel,Schopenhouer, etc.etc.) byat the base, pointing out that the attempt to evoke syllogistic or mathematical logic using highly contextualized language, just wasn't on. Hence, I would guess, the flight ofEconomics into evermore rarified(and disembodied) invocations of pure Math and the departure ofEconomics teaching from Economics reality as presented by Ed and Arthur. Its not quite "Words mean what I say that they mean" but rather that "Words means what wehave accepted that they mean" where "we" is understood in "our" multitudes, rather than in "their" pseudo scientific singularity. Mike Gurstein -Original Message-From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of Harry PollardSent: February 1, 2002 3:23 PMTo: Michael Gurstein; Keith HudsonCc: [EMAIL PROTECTED]; [EMAIL PROTECTED]Subject: RE: Economics as a science (was Re: Double-stranded Economics)Mike,I said originally:"Man's desires are unlimited.""Man seeks to satisfy his desires with the least exertion."(Gender sensitive people can change "Man" to "People".)So, change it to people.No problem.Incidentally, Man and Mankind used to mean people before the feminists decided to try witchcraft (or warlockcraft). Harry__-Michael wrote: Hmmm...Let's take a wee look at the first two of those first premises as posited byKeith...1. Man's desires are unlimited;2. Man seeks to satisfy his desires with the least exertion;Does that also and necessarily include, "scientifically" of course,:1. Woman's desires are unlimited;2. Women seek to satisfy their desires with the least exertion;(or do we suddenly find ourselves in some nasty messy confusions of meaning,structured misunderstanding, nuance, "he said/she said... etc.etc. which Ibelieve is partially the point being made by the Post-Autistic Economists.MG ** Harry Pollard Henry George School of LA Box 655 Tujunga CA 91042 Tel: (818) 352-4141 Fax: (818) 353-2242 ***
Re: Economics as a science (was Re: Double-stranded Economics)
Mike Spencer wrote: Mike G wrote: Formal Philosophy ( of the Linguistic Analysis school) made mince meat of the Germans (Hegel, Schopenhouer, etc.etc.) by at the base, pointing out that the attempt to evoke syllogistic or mathematical logic using highly contextualized language, just wasn't on. What a lovely summary! [snip] The foregoing reminds me that I should, as Neils Bohr urged, always ask questions or, as most, say how things seem to me... and never in conversation -- as opposed to those times when words are being used as weapons to hurt me... --, that I should eschew using the assertorial form (The cat is on the mat, Formal Philosophy ( of the Linguistic Analysis school) made mince meat of the German, etc.), for I truly believe that every assertion is an obfuscated question and an obfuscated value judgment, and that anyone who does not understand this in their gut as well as in their consciously held ideas, does not have much sense about what language is about (and that's just the beginning of what they are missing...). Question mark. Also, I should never use the You should grammatical construct, which is always an obfuscation -- usually by a person in a position of self-righteous power. You should should always be replaced by: I want. Actually, the You should and the [whatever] is grammatical constructs are if not identical, very similar forms of obfuscation, since every fact is a project of making the world be a certain way. God does indeed seem to me to be in the details Perhaps you too will find some value in these thoughts which I have arrived at after decades of trying to dig out from under the massive semiotic devastation of my childrearing. Or you may wonder: Bradford must indeed have had a bad childrearing for it to have taken him decades to figure out these obvious things -- Thank God that I hafve never encountered such people as he must have encountered in his childrearing! I can't imagine where he could have grown up, at least not anywhere in America or Western Europe -- Yours in discourse [a lot of word generation by anthropoid bipeds is perhaps most illuminatingly and usefully called by other names???] \brad mccormick -- Let your light so shine before men, that they may see your good works (Matt 5:16) Prove all things; hold fast that which is good. (1 Thes 5:21) ![%THINK;[SGML+APL]] Brad McCormick, Ed.D. / [EMAIL PROTECTED] - Visit my website == http://www.users.cloud9.net/~bradmcc/
RE: Economics as a science (was Re: Double-stranded Economics)
Mike, Well said. In my courses, Man has become People. Which change changes nothing but a possible acceptability. Forgive me, but you know how I like to trail my coat in front of our friends. Of course, inviting them to step on it. Harry __- Michael wrote: Harry, My point really wasn't about gender sensitivity but rather that, as the Feminist scholars have forced us to recognize (and as various other folks--notably Ray, have already pointed out)--words have meanings in contexts and that if we evoke a word we also evoke the context both in ourselves as the scribe, and in the reader -- and they need not (in fact are unlikely) to be the same. Formal Philosophy ( of the Linguistic Analysis school) made mince meat of the Germans (Hegel, Schopenhouer, etc.etc.) by at the base, pointing out that the attempt to evoke syllogistic or mathematical logic using highly contextualized language, just wasn't on. Hence, I would guess, the flight of Economics into ever more rarified (and disembodied) invocations of pure Math and the departure of Economics teaching from Economics reality as presented by Ed and Arthur. Its not quite Words mean what I say that they mean but rather that Words means what we have accepted that they mean where we is understood in our multitudes, rather than in their pseudo scientific singularity. Mike Gurstein -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of Harry Pollard Sent: February 1, 2002 3:23 PM To: Michael Gurstein; Keith Hudson Cc: [EMAIL PROTECTED]; [EMAIL PROTECTED] Subject: RE: Economics as a science (was Re: Double-stranded Economics) Mike, I said originally: Man's desires are unlimited. Man seeks to satisfy his desires with the least exertion. (Gender sensitive people can change Man to People.) So, change it to people. No problem. Incidentally, Man and Mankind used to mean people before the feminists decided to try witchcraft (or warlockcraft). Harry __- Michael wrote: Hmmm... Let's take a wee look at the first two of those first premises as posited by Keith... 1. Man's desires are unlimited; 2. Man seeks to satisfy his desires with the least exertion; Does that also and necessarily include, scientifically of course,: 1. Woman's desires are unlimited; 2. Women seek to satisfy their desires with the least exertion; (or do we suddenly find ourselves in some nasty messy confusions of meaning, structured misunderstanding, nuance, he said/she said... etc.etc. which I believe is partially the point being made by the Post-Autistic Economists. MG ** Harry Pollard Henry George School of LA Box 655 Tujunga CA 91042 Tel: (818) 352-4141 Fax: (818) 353-2242 ***
RE: Economics as a science (was Re: Double-stranded Economics)
Arthur, Anything can be as complicated as you want to make it. However, surely the basic job of the scientist is to make things simple. Economics, in its drift away from science that began perhaps at the beginning of the 20th century, has become so complicated that it is the butt of jokes. After 100 years, economists not only don't know why we've had a boom, they don't even know why it has come to an end. When Clinton mounted the largest tax hike in history - why didn't the economy go belly up? Actually, it continued to prosper. Why? Well, economists have a hundred reasons for everything - often contradictory. The triumph of their art seems to be Greenspan's periodic announcements that he's putting the interest rate down a bit. (When it doesn't work, he does it again, and again.) I suppose that the major concern in this nonsense belongs to the people who will be directly affected by capitalization. Wow! Land prices have gone up. The recession is over. Economics used to be about The Nature, Production, and Distribution, of Wealth -with Distribution meaning how Wealth is distributed among the producers. But you know that. It was about people producing the things that kept them alive. To do this they had to be able to work on land probably with the aid of tools. Quit seriously, nothing has changed. This is still the situation. We have become far more sophisticated in our use of land and tools, but it's still the same. Isn't it? However, we have buried ourselves in monstrous complication. I've practically given up reading economic papers because they are almost unreadable and say very little about nothing of importance. Economics has become an arcane study meant only for its practitioners. It does teach skills which can be useful - as Ed has indicated - but philosophically, and scientifically, it has abdicated from any responsibility. Perhaps we should abandon it and begin again. And we should start with its clientele -- people. How do these completely unpredictable people behave? Why do these completely unpredictable people behave as they do? Is there order among the chaos? But reaching back, we find the Classicals have already done this. You'll notice that not one exception to the Basic Assumptions has been suggested, though there have been several attempts to words in my mouth, and to interpret the Assumptions in ways never intended. Yet, this is just the beginning. On this foundation, we could erect an economic edifice that is not only stable, but useful to analyze the problems we have in our society. But, of course, that would be much too simple. Harry -- Arthur wrote: If only it were all this simple. Arthur, We get our clothes from the tailor - or from Penny's or Marks and Sparks We get our meat from the butcher and our produce from the greengrocer. We get our milk from the milkman. Isn't this more sensible than keeping two cows - one to slaughter - growing 17 different vegetable, running up tee-shirts on the sewing machine, and spending a couple of weeks producing an ill-fitting suit? So, why does this all change at the docks? Free Trade is not a political policy. It is natural for humans to exchange. Protection is a policy that tries to prevent this natural cooperation from happening. How simple this all is. Why make it complicated? Perhaps because that's the way the Neo-Classicals make a living. Harry ** Harry Pollard Henry George School of LA Box 655 Tujunga CA 91042 Tel: (818) 352-4141 Fax: (818) 353-2242 ***
Economics as a science (was Re: Double-stranded Economics)
Hi Harry and Arthur, For the time being, let me take just one strand from your (HP's) latest mail and attempt to show how economics can be used as a science. This will never make the whole story at all times as we (HP and KH) both agree -- human nature is also involved -- but the overall structure over the longer term ought to be scientifically analysable *and* predictions made with a high degree of confidence: At 12:48 31/01/02 -0800, you wrote: (HP) You are right to separate the two strands. However, my separation would be different. The science you speak of I think is mostly mathematics. Mathematics is a great tool, but is never better than its premises. And they are often highly suspect. These scientists have drawn around themselves a self consistent world which is not part of the real world. (As is said, Arthur, to an economist, reality is a special case!) This is why they are completely unable to predict. I will attempt to prove that the composition of world trade will be largely predictable over the long term (that is, subject to temporary wayward swings of, what Greenspan calls irrational exuberance) . - My five basic premisses are as follows -- the first two contributed by you (with which I obviously agree). I think these premisses are reasonable but I'm not going to attempt to justify these here: 1. Man's desires are unlimited; 2. Man seeks to satisfy his desires with the least exertion; 3. Ricardo's Law of Comparative Advantage holds; 4. As world-wide competitiveness increases, all national currencies (or a single world currency in due course) will increasingly represent the economic (that is, energy) efficiency of operations of supply of goods and services in any country, region, city, whatever; 5. As world-wide competitiveness increases, then the pattern of spending of all customers on staple goods and services will become increasingly similar. Proof: Let the world consists of two countries only -- X and Y. Let X and Y have similar standards of living and similar patterns of consumer spending at a given instant. Let each country produce goods and services A,B,C,D,E,F,G,H. Let the efficiency of production of country X is in the order: A,B,C,D,E,F,G,H; and that the efficiency of production of country Y is E,F,G,H,A,B,C,D. Then, clearly, the standard of living of both countries can be maximised when country X makes and exports A,B,C,D only to country Y, and country Y makes and exports E,F,G,H only to country X. This can now be generalised to all goods and services and to all countries, regions, cities and, indeed individual producers and consumers. Therefore: Given enough computing power, then the overall pattern of world trade can be predicted. -- Now the above can't account for new discoveries and innovative goods and services. But, given that important new ones come along now and again, then, as soon as they become incorporated in one statistically valid region (that is, one with enough consumers to give a sensible sample), then a reformulation of future world trade can be arrived at. -- This has some important consequences: 1. Maximising world trade is desirable for all; 2. However, the shunting of production or service operations around the world (say, on the basis of the cost of labour only) by individual corporations with a narrow range of products is not desirable, nor stable, over the long term. This is the valid core of the argument of the anti-globalisation protesters and if they were to confine themselves to this point only then I would agree wholeheartedly with them. 3. Ideally, each country, region, city, of individual (any entity with aspirations) should not copy the staple operations of others but should maximise those operations which are unique to it/he/she (or to which it/he/she is especially benefited by location, climate, etc.). Very good examples of the dangers of not doing this are those of the 'copycat countries' of Asia which tried to replicate the production of consumer goods of other more established countries. They may succeed very well for a while with temporary increases in efficiency, particularly if they have a large domestic market, but unless they can show clear efficiency advantages over the longer term then they're in trouble as regards exports. Today, for example, Japan is not able to invest profitably at the present time because its present production mix is too similar to America's and doesn't seem to be developing anything which gives it a clear comparative advantage. The lesson is that all entities should specialise in what they are already particularly good at, or in the unique benefits which their region possesses. (As the pattern of consumer spending becomes increasingly similar, or aspired to, in all countries, this explains why tourism is becoming increasingly important to all countries, developed and undeveloped -- and speciality holidays even more so.) This isn't to say that they shouldn't
RE: Economics as a science (was Re: Double-stranded Economics)
Hmmm... Let's take a wee look at the first two of those first premises as posited by Keith... 1. Man's desires are unlimited; 2. Man seeks to satisfy his desires with the least exertion; Does that also and necessarily include, scientifically of course,: 1. Woman's desires are unlimited; 2. Women seek to satisfy their desires with the least exertion; (or do we suddenly find ourselves in some nasty messy confusions of meaning, structured misunderstanding, nuance, he said/she said... etc.etc. which I believe is partially the point being made by the Post-Autistic Economists. MG -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of Keith Hudson Sent: February 1, 2002 4:21 AM To: Harry Pollard Cc: [EMAIL PROTECTED]; [EMAIL PROTECTED] Subject: Economics as a science (was Re: Double-stranded Economics) Hi Harry and Arthur, For the time being, let me take just one strand from your (HP's) latest mail and attempt to show how economics can be used as a science. This will never make the whole story at all times as we (HP and KH) both agree -- human nature is also involved -- but the overall structure over the longer term ought to be scientifically analysable *and* predictions made with a high degree of confidence: I will attempt to prove that the composition of world trade will be largely predictable over the long term (that is, subject to temporary wayward swings of, what Greenspan calls irrational exuberance) . - My five basic premisses are as follows -- the first two contributed by you (with which I obviously agree). I think these premisses are reasonable but I'm not going to attempt to justify these here: 1. Man's desires are unlimited; 2. Man seeks to satisfy his desires with the least exertion; 3. Ricardo's Law of Comparative Advantage holds; 4. As world-wide competitiveness increases, all national currencies (or a single world currency in due course) will increasingly represent the economic (that is, energy) efficiency of operations of supply of goods and services in any country, region, city, whatever; 5. As world-wide competitiveness increases, then the pattern of spending of all customers on staple goods and services will become increasingly similar. Proof: Let the world consists of two countries only -- X and Y. Let X and Y have similar standards of living and similar patterns of consumer spending at a given instant. Let each country produce goods and services A,B,C,D,E,F,G,H. Let the efficiency of production of country X is in the order: A,B,C,D,E,F,G,H; and that the efficiency of production of country Y is E,F,G,H,A,B,C,D. Then, clearly, the standard of living of both countries can be maximised when country X makes and exports A,B,C,D only to country Y, and country Y makes and exports E,F,G,H only to country X. This can now be generalised to all goods and services and to all countries, regions, cities and, indeed individual producers and consumers. Therefore: Given enough computing power, then the overall pattern of world trade can be predicted. -- Now the above can't account for new discoveries and innovative goods and services. But, given that important new ones come along now and again, then, as soon as they become incorporated in one statistically valid region (that is, one with enough consumers to give a sensible sample), then a reformulation of future world trade can be arrived at. -- This has some important consequences: 1. Maximising world trade is desirable for all; 2. However, the shunting of production or service operations around the world (say, on the basis of the cost of labour only) by individual corporations with a narrow range of products is not desirable, nor stable, over the long term. This is the valid core of the argument of the anti-globalisation protesters and if they were to confine themselves to this point only then I would agree wholeheartedly with them. 3. Ideally, each country, region, city, of individual (any entity with aspirations) should not copy the staple operations of others but should maximise those operations which are unique to it/he/she (or to which it/he/she is especially benefited by location, climate, etc.). Very good examples of the dangers of not doing this are those of the 'copycat countries' of Asia which tried to replicate the production of consumer goods of other more established countries. They may succeed very well for a while with temporary increases in efficiency, particularly if they have a large domestic market, but unless they can show clear efficiency advantages over the longer term then they're in trouble as regards exports. Today, for example, Japan is not able to invest profitably at the present time because its present production mix is too similar to America's and doesn't seem to be developing anything which gives it a clear comparative advantage. The lesson is that all entities should specialise in what they are already particularly good
RE: Economics as a science (was Re: Double-stranded Economics)
Somewhat correct with the following assumptions: That countries produce according to their resource endowment (the wine and cloth argument from Ricardo vis a vis Portugal and England) But in the networked knowledge age we find that resource endowment is also intelligence and knowhow and economies can develop in ways that wouldn't have been guessed, given their natural resource endowment. Consider Singapore or South Korea. The latter doing very well in ranges of technoology intensive products. Or India with its software industry. And what would Keith's outline tell China: do what you have always done, play to your resource strengths and leave high tech to the west? Also resource rich countries can do quite poorly given internal commercial and cultural considerations, viz., Argentina. The outline below offered by Keith is appropriate for a relatively fixed pattern of natural resource endowment. Somewhat as the early British writers saw things and appropriate too for their view of England vis a vis the rest of the trading world. arthur -Original Message- From: Keith Hudson [mailto:[EMAIL PROTECTED]] Sent: Friday, February 01, 2002 4:21 AM To: Harry Pollard Cc: [EMAIL PROTECTED]; Cordell, Arthur: ECOM Subject: Economics as a science (was Re: Double-stranded Economics) Hi Harry and Arthur, For the time being, let me take just one strand from your (HP's) latest mail and attempt to show how economics can be used as a science. This will never make the whole story at all times as we (HP and KH) both agree -- human nature is also involved -- but the overall structure over the longer term ought to be scientifically analysable *and* predictions made with a high degree of confidence: At 12:48 31/01/02 -0800, you wrote: (HP) You are right to separate the two strands. However, my separation would be different. The science you speak of I think is mostly mathematics. Mathematics is a great tool, but is never better than its premises. And they are often highly suspect. These scientists have drawn around themselves a self consistent world which is not part of the real world. (As is said, Arthur, to an economist, reality is a special case!) This is why they are completely unable to predict. I will attempt to prove that the composition of world trade will be largely predictable over the long term (that is, subject to temporary wayward swings of, what Greenspan calls irrational exuberance) . - My five basic premisses are as follows -- the first two contributed by you (with which I obviously agree). I think these premisses are reasonable but I'm not going to attempt to justify these here: 1. Man's desires are unlimited; 2. Man seeks to satisfy his desires with the least exertion; 3. Ricardo's Law of Comparative Advantage holds; 4. As world-wide competitiveness increases, all national currencies (or a single world currency in due course) will increasingly represent the economic (that is, energy) efficiency of operations of supply of goods and services in any country, region, city, whatever; 5. As world-wide competitiveness increases, then the pattern of spending of all customers on staple goods and services will become increasingly similar. Proof: Let the world consists of two countries only -- X and Y. Let X and Y have similar standards of living and similar patterns of consumer spending at a given instant. Let each country produce goods and services A,B,C,D,E,F,G,H. Let the efficiency of production of country X is in the order: A,B,C,D,E,F,G,H; and that the efficiency of production of country Y is E,F,G,H,A,B,C,D. Then, clearly, the standard of living of both countries can be maximised when country X makes and exports A,B,C,D only to country Y, and country Y makes and exports E,F,G,H only to country X. This can now be generalised to all goods and services and to all countries, regions, cities and, indeed individual producers and consumers. Therefore: Given enough computing power, then the overall pattern of world trade can be predicted. -- Now the above can't account for new discoveries and innovative goods and services. But, given that important new ones come along now and again, then, as soon as they become incorporated in one statistically valid region (that is, one with enough consumers to give a sensible sample), then a reformulation of future world trade can be arrived at. -- This has some important consequences: 1. Maximising world trade is desirable for all; 2. However, the shunting of production or service operations around the world (say, on the basis of the cost of labour only) by individual corporations with a narrow range of products is not desirable, nor stable, over the long term. This is the valid core of the argument of the anti-globalisation protesters and if they were to confine themselves to this point only then I would agree wholeheartedly with them. 3. Ideally, each country, region, city, of individual (any entity with aspirations
RE: Economics as a science (was Re: Double-stranded Economics)
One more problem with Keith's outline. It is a static analysis assuming things remain the same. And in the world of Ricardo we could make that assumption. Things are dynamic, and when we mix in knowledge, knowhow, internal commercial and cultural ways of doing business---well the static analysis is misleading. arthur -Original Message- From: Keith Hudson [mailto:[EMAIL PROTECTED]] Sent: Friday, February 01, 2002 4:21 AM To: Harry Pollard Cc: [EMAIL PROTECTED]; Cordell, Arthur: ECOM Subject: Economics as a science (was Re: Double-stranded Economics) Hi Harry and Arthur, For the time being, let me take just one strand from your (HP's) latest mail and attempt to show how economics can be used as a science. This will never make the whole story at all times as we (HP and KH) both agree -- human nature is also involved -- but the overall structure over the longer term ought to be scientifically analysable *and* predictions made with a high degree of confidence: At 12:48 31/01/02 -0800, you wrote: (HP) You are right to separate the two strands. However, my separation would be different. The science you speak of I think is mostly mathematics. Mathematics is a great tool, but is never better than its premises. And they are often highly suspect. These scientists have drawn around themselves a self consistent world which is not part of the real world. (As is said, Arthur, to an economist, reality is a special case!) This is why they are completely unable to predict. I will attempt to prove that the composition of world trade will be largely predictable over the long term (that is, subject to temporary wayward swings of, what Greenspan calls irrational exuberance) . - My five basic premisses are as follows -- the first two contributed by you (with which I obviously agree). I think these premisses are reasonable but I'm not going to attempt to justify these here: 1. Man's desires are unlimited; 2. Man seeks to satisfy his desires with the least exertion; 3. Ricardo's Law of Comparative Advantage holds; 4. As world-wide competitiveness increases, all national currencies (or a single world currency in due course) will increasingly represent the economic (that is, energy) efficiency of operations of supply of goods and services in any country, region, city, whatever; 5. As world-wide competitiveness increases, then the pattern of spending of all customers on staple goods and services will become increasingly similar. Proof: Let the world consists of two countries only -- X and Y. Let X and Y have similar standards of living and similar patterns of consumer spending at a given instant. Let each country produce goods and services A,B,C,D,E,F,G,H. Let the efficiency of production of country X is in the order: A,B,C,D,E,F,G,H; and that the efficiency of production of country Y is E,F,G,H,A,B,C,D. Then, clearly, the standard of living of both countries can be maximised when country X makes and exports A,B,C,D only to country Y, and country Y makes and exports E,F,G,H only to country X. This can now be generalised to all goods and services and to all countries, regions, cities and, indeed individual producers and consumers. Therefore: Given enough computing power, then the overall pattern of world trade can be predicted. -- Now the above can't account for new discoveries and innovative goods and services. But, given that important new ones come along now and again, then, as soon as they become incorporated in one statistically valid region (that is, one with enough consumers to give a sensible sample), then a reformulation of future world trade can be arrived at. -- This has some important consequences: 1. Maximising world trade is desirable for all; 2. However, the shunting of production or service operations around the world (say, on the basis of the cost of labour only) by individual corporations with a narrow range of products is not desirable, nor stable, over the long term. This is the valid core of the argument of the anti-globalisation protesters and if they were to confine themselves to this point only then I would agree wholeheartedly with them. 3. Ideally, each country, region, city, of individual (any entity with aspirations) should not copy the staple operations of others but should maximise those operations which are unique to it/he/she (or to which it/he/she is especially benefited by location, climate, etc.). Very good examples of the dangers of not doing this are those of the 'copycat countries' of Asia which tried to replicate the production of consumer goods of other more established countries. They may succeed very well for a while with temporary increases in efficiency, particularly if they have a large domestic market, but unless they can show clear efficiency advantages over the longer term then they're in trouble as regards exports. Today, for example, Japan is not able to invest profitably at the present time because its present
RE: Economics as a science (was Re: Double-stranded Economics)
Hi Arthur, At 08:40 01/02/02 -0500, you wrote: (AC) Somewhat correct with the following assumptions: That countries produce according to their resource endowment (the wine and cloth argument from Ricardo vis a vis Portugal and England) Yes. This would have a direct relationship with high efficiency, or low opportunity costs or at purchasing parity as economists are wont to say. (AC) But in the networked knowledge age we find that resource endowment is also intelligence and knowhow and economies can develop in ways that wouldn't have been guessed, given their natural resource endowment. Consider Singapore or South Korea. The latter doing very well in ranges of technoology intensive products. Or India with its software industry. Yes, indeed. A very good point. 'Clustering' (or the 'Silicon Valley' effect). I thought of mentioning this in my original message but decided not to for reasons of brevity. (Purely as an aside, it's going to be interesting whether China is going to be as good at software development as India has been in Bangalore. I was reading some weeks ago in the FT that several delegations of Chinese politicians and academics have been to visit some of the large software firms in India [and aparently being welcomed!] -- obviously seeing whether they could transplant these sorts of operations in China. Also, I've read that Microsoft is setting up a research outfit in China.) (AC) And what would Keith's outline tell China: do what you have always done, play to your resource strengths and leave high tech to the west? Well, if they're going to do what they've done so far (say, since 1850 or thereabouts when they had a well-developed, though small, steel industry) then I doubt whether they'd improve on the standard of living of the west, no matter how well they lifted themselves up by their bootstraps. But I imagine that they aspire to improving on our standards. So I'd guess that they'd want to take PC and software production (for example) as far as they could take it (which they are doing, of course) in case they prove themselves superior to, say, Silicon Valley or Singapore. Besides any number of innovative sideshoots could possibly spring up from the PC which we can hardly guess at at the moment, and they wouldn't want to be left behind if there are significant developments here. Also, China isn't terribly well-endowed with oil or coal resources. Altogether, I think we can expect startling developments in China. It has had a respect for scholarship going back 2,500 years to Confucius and an amazing capacity for innovation. Since Mao's Cultural Revolution has died a death China's universities have become transformed. I think we can see it scooping up Nobel prizes and innovating in a way that other Asian countries have not been able to do so far. (AC) Also resource rich countries can do quite poorly given internal commercial and cultural considerations, viz., Argentina. Yes, the lack of an entrepreneurial culture is the thing that's held Argentina back ever since it entered the developed world economy with a whoosh on the back of meat and grain products. From 1850 to 1914 it became the fourth largest economy in the world, but once the meat trade took a bashing because of WWI its economy has declined ever since because it had nothing else to take up the slack. When one thinks of the length of time it took for all the necessary cultural and conceptual strands to come together before the Industrial Revolution took off in England (a couple of centuries at least) then implanting modern economic development in many countries is a great deal more difficult than envisaged until very recent years. Large World Bank projects can't succeed unless there's a cultural preparedness. This is the mistake that the WB and IMF has made hitherto. (I suppose it means that, more than anything else, education must be accelerated in many countries, before other scehems have a chance of success.) (AC) The outline below offered by Keith is appropriate for a relatively fixed pattern of natural resource endowment. Somewhat as the early British writers saw things and appropriate too for their view of England vis a vis the rest of the trading world. This is a fascinating point because it's possible that what we presently consider to be the natural resource endowment may change considerably in the next decade or two. Solar technology could transform the prospects of many barren countries. Keith -Original Message- From: Keith Hudson [mailto:[EMAIL PROTECTED]] Sent: Friday, February 01, 2002 4:21 AM To: Harry Pollard Cc: [EMAIL PROTECTED]; Cordell, Arthur: ECOM Subject: Economics as a science (was Re: Double-stranded Economics) Hi Harry and Arthur, For the time being, let me take just one strand from your (HP's) latest mail and attempt to show how economics can be used as a science. This will never make the whole story at all times as we (HP and KH) both agree -- human nature is also involved
RE: Economics as a science (was Re: Double-stranded Economics)
Hi Arthur, At 08:40 01/02/02 -0500, you wrote: (AC) Somewhat correct with the following assumptions: That countries produce according to their resource endowment (the wine and cloth argument from Ricardo vis a vis Portugal and England) Yes. This would have a direct relationship with high efficiency, or low opportunity costs or at purchasing parity as economists are wont to say. (AC) But in the networked knowledge age we find that resource endowment is also intelligence and knowhow and economies can develop in ways that wouldn't have been guessed, given their natural resource endowment. Consider Singapore or South Korea. The latter doing very well in ranges of technoology intensive products. Or India with its software industry. Yes, indeed. A very good point. 'Clustering' (or the 'Silicon Valley' effect). I thought of mentioning this in my original message but decided not to for reasons of brevity. (Purely as an aside, it's going to be interesting whether China is going to be as good at software development as India has been in Bangalore. I was reading some weeks ago in the FT that several delegations of Chinese politicians and academics have been to visit some of the large software firms in India [and aparently being welcomed!] -- obviously seeing whether they could transplant these sorts of operations in China. Also, I've read that Microsoft is setting up a research outfit in China.) (AC) And what would Keith's outline tell China: do what you have always done, play to your resource strengths and leave high tech to the west? Well, if they're going to do what they've done so far (say, since 1850 or thereabouts when they had a well-developed, though small, steel industry) then I doubt whether they'd improve on the standard of living of the west, no matter how well they lifted themselves up by their bootstraps. But I imagine that they aspire to improving on our standards. So I'd guess that they'd want to take PC and software production (for example) as far as they could take it (which they are doing, of course) in case they prove themselves superior to, say, Silicon Valley or Singapore. Besides any number of innovative sideshoots could possibly spring up from the PC which we can hardly guess at at the moment, and they wouldn't want to be left behind if there are significant developments here. Also, China isn't terribly well-endowed with oil or coal resources. Altogether, I think we can expect startling developments in China. It has had a respect for scholarship going back 2,500 years to Confucius and an amazing capacity for innovation. Since Mao's Cultural Revolution has died a death China's universities have become transformed. I think we can see it scooping up Nobel prizes and innovating in a way that other Asian countries have not been able to do so far. (AC) Also resource rich countries can do quite poorly given internal commercial and cultural considerations, viz., Argentina. Yes, the lack of an entrepreneurial culture is the thing that's held Argentina back ever since it entered the developed world economy with a whoosh on the back of meat and grain products. From 1850 to 1914 it became the fourth largest economy in the world, but once the meat trade took a bashing because of WWI its economy has declined ever since because it had nothing else to take up the slack. When one thinks of the length of time it took for all the necessary cultural and conceptual strands to come together before the Industrial Revolution took off in England (a couple of centuries at least) then implanting modern economic development in many countries is a great deal more difficult than envisaged until very recent years. Large World Bank projects can't succeed unless there's a cultural preparedness. This is the mistake that the WB and IMF has made hitherto. (I suppose it means that, more than anything else, education must be accelerated in many countries, before other scehems have a chance of success.) (AC) The outline below offered by Keith is appropriate for a relatively fixed pattern of natural resource endowment. Somewhat as the early British writers saw things and appropriate too for their view of England vis a vis the rest of the trading world. This is a fascinating point because it's possible that what we presently consider to be the natural resource endowment may change considerably in the next decade or two. Solar technology could transform the prospects of many barren countries. Keith -Original Message- From: Keith Hudson [mailto:[EMAIL PROTECTED]] Sent: Friday, February 01, 2002 4:21 AM To: Harry Pollard Cc: [EMAIL PROTECTED]; Cordell, Arthur: ECOM Subject: Economics as a science (was Re: Double-stranded Economics) Hi Harry and Arthur, For the time being, let me take just one strand from your (HP's) latest mail and attempt to show how economics can be used as a science. This will never make the whole story at all times as we (HP and KH) both agree -- human nature is also involved
Re: Economics as a science (was Re: Double-stranded Economics)
From: [EMAIL PROTECTED] Sent: Friday, February 01, 2002 8:40 AM Subject: RE: Economics as a science (was Re: Double-stranded Economics) Arthur said: (snip) And what would Keith's outline tell China: do what you have always done, play to your resource strengths and leave high tech to the west? Also resource rich countries can do quite poorly given internal commercial and cultural considerations, viz., Argentina. (snip) ECONOMIC TRACKING OR POOR INTELLECTUAL PRODUCTIVITY: This kind of tracking is typical of 19th century thought. It has a parallel in the last forty years educational tracking where children are tested and tracked according to their "intellectual" IQ. The only problem is that children, who don't accept the model and continue on their own, often do well in the very areas that they were moved away from by the scientists. Unfortunately, it is not always legal or humanitarian. The assumption is that they will be happiest getting the most for the least. That failure has created a crisis in educational testing in the U.S. with colleges rejecting the use ofstandardized tests in favor of their more practical academic tests created for theeducational and cultural approach of their institution (yesterday's NYTimes). Generalized Intellectual IQ , as well as most psycho-therapeutic processes function on the assumption that human systems are OK and that the individual is the problem. Thatindividuals musteitherbe "broken" and remade to fit the Ideal System(the New Birth assumption) orthe Humanist argument thatindividual systems are also OK and that the problem is in finding the right fit between the two, hence IQand otherSTANDARDIZED tests will accomplish that goal. The only problem is that both assumes a static system when in fact the one constantamong humans is thata static reality is a rigid dogmatic one. Instead of a learning/developing systemboth the individual and the group system "calcifies" and becomes rigid.It seems to me that this goes against nature and that growth and change are the only real given.That it is the growingor what the Aztecs called "Ollin" or educational movement, that is the rule of game. The problem is in the learning systems of the culture and their Poor Intellectual Productivity. For example: HOW STRENGTH BECOMES WEAKNESS AND EXAMPLE: On a physical level, we can compare it to the use of the spine in animals. If a person does not have enough rigidity in their spine we call them "spineless." We are uncomfortable with a human who moves like a snake and yet the thalidomide children who suffered the lack of limbs learned to climb stairs with their spines. There is even a wonderful singer who shows such a powerful use of the voice and breath that we are amazed. He is a thalidomide baby and his spine is powerful in that way. That power makes his spinal nerves available to him in ways that voice teachers are amazed by. We teachers haveall kinds of physical exercises to develop the same openness, flexibility and strength in normal people but rarely achieve it due to the uncomfortableness of the normal person with their spine. Our work is, unfortunately not pedagogical but therapeutic or as we say "the unteaching of improper habits taught by cultural and linguistic ideals taughtafter the child learned to walk." Why did the child do it? Because the people they loved and admired did it and they were the best success stories they knew. Such conditioning begins immediately as the child imprints on the parent's bad habits as soon as they can stand. Normal parents who would see their children truly exercising their spines would think them an aberration orcall such movements "writhing" and equate them with pain. "Honey, are you OK? How do you feel? Are you sick? You seem uncomfortable..." etc, etc. When German Jew Elsa Gindler and the Australian F.M. Alexander began to do research in these areas in the early 20th century, they were (and in many places still are) considered on the fringe of science. Today both the dance and million dollar athletes have changed that with a resultant great leap forward in the medical practice of physical therapy. But Hitler considered Gindler not only to be repugnant as a Jew but her theories about physical potential were not "upright" enough for his image of soldiers marching in the act of physical bonding. Gindler escaped Germany and the rest of us benefited mightily at his foolishness.In that tradition the actual words for the spinegrew out of a need for the spine to act,NOT like a digital rope, but like a rigid bar that would withstand the physical blows of an enemy. In the burst of entertainment interest sports such rules created copious injuries in professional athletes and yet were associated with "truth, dignity and upright character" while a natural sp
RE: Economics as a science (was Re: Double-stranded Economics)
Mike, I said originally: Man's desires are unlimited. Man seeks to satisfy his desires with the least exertion. (Gender sensitive people can change Man to People.) So, change it to people. No problem. Incidentally, Man and Mankind used to mean people before the feminists decided to try witchcraft (or warlockcraft). Harry __- Michael wrote: Hmmm... Let's take a wee look at the first two of those first premises as posited by Keith... 1. Man's desires are unlimited; 2. Man seeks to satisfy his desires with the least exertion; Does that also and necessarily include, scientifically of course,: 1. Woman's desires are unlimited; 2. Women seek to satisfy their desires with the least exertion; (or do we suddenly find ourselves in some nasty messy confusions of meaning, structured misunderstanding, nuance, he said/she said... etc.etc. which I believe is partially the point being made by the Post-Autistic Economists. MG ** Harry Pollard Henry George School of LA Box 655 Tujunga CA 91042 Tel: (818) 352-4141 Fax: (818) 353-2242 ***
RE: Economics as a science (was Re: Double-stranded Economics)
Arthur, We get our clothes from the tailor - or from Penny's or Marks and Sparks We get our meat from the butcher and our produce from the greengrocer. We get our milk from the milkman. Isn't this more sensible than keeping two cows - one to slaughter - growing 17 different vegetable, running up tee-shirts on the sewing machine, and spending a couple of weeks producing an ill-fitting suit? So, why does this all change at the docks? Free Trade is not a political policy. It is natural for humans to exchange. Protection is a policy that tries to prevent this natural cooperation from happening. How simple this all is. Why make it complicated? Perhaps because that's the way the Neo-Classicals make a living. Harry _ Arthur wrote: Somewhat correct with the following assumptions: That countries produce according to their resource endowment (the wine and cloth argument from Ricardo vis a vis Portugal and England) But in the networked knowledge age we find that resource endowment is also intelligence and knowhow and economies can develop in ways that wouldn't have been guessed, given their natural resource endowment. Consider Singapore or South Korea. The latter doing very well in ranges of technoology intensive products. Or India with its software industry. And what would Keith's outline tell China: do what you have always done, play to your resource strengths and leave high tech to the west? Also resource rich countries can do quite poorly given internal commercial and cultural considerations, viz., Argentina. The outline below offered by Keith is appropriate for a relatively fixed pattern of natural resource endowment. Somewhat as the early British writers saw things and appropriate too for their view of England vis a vis the rest of the trading world. arthur -Original Message- From: Keith Hudson [mailto:[EMAIL PROTECTED]] Sent: Friday, February 01, 2002 4:21 AM To: Harry Pollard Cc: [EMAIL PROTECTED]; Cordell, Arthur: ECOM Subject: Economics as a science (was Re: Double-stranded Economics) Hi Harry and Arthur, For the time being, let me take just one strand from your (HP's) latest mail and attempt to show how economics can be used as a science. This will never make the whole story at all times as we (HP and KH) both agree -- human nature is also involved -- but the overall structure over the longer term ought to be scientifically analysable *and* predictions made with a high degree of confidence: At 12:48 31/01/02 -0800, you wrote: (HP) You are right to separate the two strands. However, my separation would be different. The science you speak of I think is mostly mathematics. Mathematics is a great tool, but is never better than its premises. And they are often highly suspect. These scientists have drawn around themselves a self consistent world which is not part of the real world. (As is said, Arthur, to an economist, reality is a special case!) This is why they are completely unable to predict. I will attempt to prove that the composition of world trade will be largely predictable over the long term (that is, subject to temporary wayward swings of, what Greenspan calls irrational exuberance) . - My five basic premisses are as follows -- the first two contributed by you (with which I obviously agree). I think these premisses are reasonable but I'm not going to attempt to justify these here: 1. Man's desires are unlimited; 2. Man seeks to satisfy his desires with the least exertion; 3. Ricardo's Law of Comparative Advantage holds; 4. As world-wide competitiveness increases, all national currencies (or a single world currency in due course) will increasingly represent the economic (that is, energy) efficiency of operations of supply of goods and services in any country, region, city, whatever; 5. As world-wide competitiveness increases, then the pattern of spending of all customers on staple goods and services will become increasingly similar. Proof: Let the world consists of two countries only -- X and Y. Let X and Y have similar standards of living and similar patterns of consumer spending at a given instant. Let each country produce goods and services A,B,C,D,E,F,G,H. Let the efficiency of production of country X is in the order: A,B,C,D,E,F,G,H; and that the efficiency of production of country Y is E,F,G,H,A,B,C,D. Then, clearly, the standard of living of both countries can be maximised when country X makes and exports A,B,C,D only to country Y, and country Y makes and exports E,F,G,H only to country X. This can now be generalised to all goods and services and to all countries, regions, cities and, indeed individual producers and consumers. Therefore: Given enough computing power, then the overall pattern of world trade can be predicted. -- Now the above can't account for new discoveries and innovative goods and services. But, given that important new ones come along now and again, then, as soon as they become incorporated in one
Re: Economics as a science (was Re: Double-stranded Economics)
"Man's desires are unlimited." Human desires are limited by many things. Imagination, experience, love, hate, empathy, morality, poverty, boredom, blindness, deafness, taste, or a lack of any of the above. I'm sure that I could think more seriously about it if I wanted to. Since most of these authorities were based in their own experience, imagination, love, hate, poverty, boredom, talent, perceptions and history, I have no doubt that a different body, mind, heart, spirit and history would come up with different aphorisms relating to desire. Especially if the object of your desire is procreative. I will say instead that"one's desires are limited to their knowledge of themselves." Is avirgin teenager desiring sex or does their inexperiencemean that they desire something else? Just because they use the word does not mean that what they "say", is a true desire. However, I will give you that they believe it to be unlimited. Now if you mean that "Man" or "Human" as a generality, rather than an individual, then you must say that Man or Hu-man's desires are limited by their being. For example they wouldn't desire the soundscape inhabited by dogs or the visual world of a bee since we don't know either. To desire something you don't know is too amorphous.To desire what you cannot know is a useless proposition. You can only desire what you know, what your symbols describe and what your perceptions percieve. The ability to image-ine a desire is based upon such a thing. Harry, its just too romantic for me. Like adolescent melancholia. "Man seeks to satisfy his desires with the least exertion." Whywould a human seek to satisfy their desires with the least exertion? I would suggest that such a thing might be a good definition of what you do not desire but are being forced to do for some reason. I can think of many experiences where sacrifice is more important than a laziness of exertion. Running for example, unless you are a CEO who is doing it for your heart and desire to finish to do what you really want. People who do things from a sense of pleasure do not seek to stop but to continue. Do you want to satisfy your lover with the least possible exertion? Sounds pretty boring to me. aphorisms are just sound bites. If you wish to find the balance that is necessary to complete a work of art or whatever then that is not a matter of exertion but of disgression and sensitivity. Exertion is a perfect term for a 19th century philosopher who has made his way across America too fast and unhappily. Doing it right, no less and no more is a matter of art. Most people do not ascribe to that at all but simply to do the task until they are tired and stop. We could say that the person who is concerned with just the right amount is a classicist while the person who wishes to go on forever is a romantic. What I would call your statement is inaccurate and hyper-rational but not logical. I could enjoy this much too long for what is good for me or what I need to do. Ray
Re: Economics as a science (was Re: Double-stranded Economics)
Free Trade is not a political policy. It is natural for humans to exchange. True but that is a very simple thing. What do you think about capital or speculation? Protection is a policy that tries to prevent this natural cooperation from happening. No, protection is just one of the strategies of trade. It is, like all conflict, a contraction meant to hold back nature until a more opportune time to negotiate takes place. It is no more unnatural than sticks piling up in a stream. In fact if you chart the flow of trade I suspect that you will find the same wave patterns as in other liquids with the corresponding contraction and resolution that we find in dissonance and consonance in music. How simple this all is. Why make it complicated? Perhaps because that's the way the Neo-Classicals make a living. What this means is that I am not convinced that you know of what you speak. It is one thing to declare a lack of complexity which would imply that you are competant at what you speak, it is another to actually prove it in practical action. Could you share your experience in the private world with some of these principles? What are your successes and failures? Also you could be a lot clearer on your definitions of such things as the kind of market you consider "free." It all seems like an exercise in "one up manship" rather than a pursuit of values. Cheers, Ray
RE: Economics as a science (was Re: Double-stranded Economics)
If only it were all this simple. -Original Message-From: Harry Pollard [mailto:[EMAIL PROTECTED]]Sent: Friday, February 01, 2002 3:34 PMTo: Cordell, Arthur: ECOM; [EMAIL PROTECTED]Cc: [EMAIL PROTECTED]Subject: RE: Economics as a science (was Re: Double-stranded Economics)Arthur,We get our clothes from the tailor - or from Penny's or Marks and SparksWe get our meat from the butcher and our produce from the greengrocer.We get our milk from the milkman.Isn't this more sensible than keeping two cows - one to slaughter - growing 17 different vegetable, running up tee-shirts on the sewing machine, and spending a couple of weeks producing an ill-fitting suit?So, why does this all change at the docks?Free Trade is not a political policy. It is natural for humans to exchange.Protection is a policy that tries to prevent this natural cooperation from happening.How simple this all is. Why make it complicated? Perhaps because that's the way the Neo-Classicals make a living. Harry_Arthur wrote: Somewhat correct with the following assumptions:That countries produce according to their resource endowment (the wine andcloth argument from Ricardo vis a vis Portugal and England)But in the networked knowledge age we find that resource endowment is alsointelligence and knowhow and economies can develop in ways that wouldn'thave been guessed, given their natural resource endowment. ConsiderSingapore or South Korea. The latter doing very well in ranges oftechnoology intensive products. Or India with its software industry. Andwhat would Keith's outline tell China: do what you have always done, play toyour resource strengths and leave high tech to the west? Also resource richcountries can do quite poorly given internal commercial and culturalconsiderations, viz., Argentina.The outline below offered by Keith is appropriate for a relatively fixedpattern of natural resource endowment. Somewhat as the early Britishwriters saw things and appropriate too for their view of England vis a visthe rest of the trading world.arthur-Original Message-From: Keith Hudson [mailto:[EMAIL PROTECTED]]Sent: Friday, February 01, 2002 4:21 AMTo: Harry PollardCc: [EMAIL PROTECTED]; Cordell, Arthur: ECOMSubject: Economics as a science (was Re: Double-stranded Economics)Hi Harry and Arthur,For the time being, let me take just one strand from your (HP's) latestmail and attempt to show how economics can be used as a science. This willnever make the whole story at all times as we (HP and KH) both agree --human nature is also involved -- but the overall structure over the longerterm ought to be scientifically analysable *and* predictions made with ahigh degree of confidence:At 12:48 31/01/02 -0800, you wrote:(HP)You are right to separate the two strands.However, my separation would be different.The "science" you speak of I think is mostly mathematics. Mathematics is agreat tool, but is never better than its premises. And they are oftenhighly suspect.These scientists have drawn around themselves a self consistent world whichis not part of the real world. (As is said, Arthur, to an economist,reality is a special case!)This is why they are completely unable to predict.I will attempt to prove that the composition of world trade will be largelypredictable over the long term (that is, subject to temporary waywardswings of, what Greenspan calls "irrational exuberance") .-My five basic premisses are as follows -- the first two contributed by you(with which I obviously agree). I think these premisses are reasonable butI'm not going to attempt to justify these here:1. Man's desires are unlimited;2. Man seeks to satisfy his desires with the least exertion;3. Ricardo's Law of Comparative Advantage holds;4. As world-wide competitiveness increases, all national currencies (or asingle world currency in due course) will increasingly represent theeconomic (that is, energy) efficiency of operations of supply of goods andservices in any country, region, city, whatever;5. As world-wide competitiveness increases, then the pattern of spending ofall customers on staple goods and services will become increasingly similar.Proof:Let the world consists of two countries only -- X and Y.Let X and Y have similar standards of living and similar patterns ofconsumer spending at a given instant.Let each country produce goods and services A,B,C,D,E,F,G,H.Let the efficiency of production of country X is in the order:A,B,C,D,E,F,G,H; and that the efficiency of production of country Y isE,F,G,H,A,B,C,D.Then, clearly, the standard of living of both countries can be maximised
