Jay wrote:
>>Harry Pollard wrote:
>>The Classical Political Economy I teach has two Basic Assumptions. The
>>whole science rests on these two assumptions. In half century of teaching
>>adults, no-one has successfully responded to "Come up with two examples of
>>people not described by both Assumptions".
>>
>>They are:
>>
>>"Man's desires are unlimited";
>>
>>"Man seeks to satisfy his desires with the least exertion".
>
>Explicitly define "desires" and "least exertion".
I don't mind the dictionary description of the term 'desire' - 'conscious
impulse toward an object or experience that promises enjoyment or
satisfaction in its attainment'.
'Want' is often confused with desire. 'Desire' may be described as 'want
with intention to satisfy'. One may 'want' to be a film star. (In fact,
lots of people want to be a film stars.) But, if you take acting lessons,
perhaps get an agent and haunt the Hollywood studios, perhaps it can then
be said "You desire to be a film star."
The dictionary suggests 'to exert' is 'to put forth' - 'to put (oneself)
into action or to tiring effort'.
'Exertion' is 'a laborious or perceptible effort'.
I would simply say that when we do something we are exerting ourselves. In
this context, both mental and physical exertion are included in the term.
To remove the non-essentials we say that if the exertion produces nothing
with exchange value. The product that has exchange value we call 'Wealth'.
The exertion that produces it is named 'Labor'.
>What economists usually do is the opposite of science.
What has that to do with anything? However, I won't ask for anymore than a
ballpark figure of 'usually'.
>Rather than beginning with a hypothesis that contains
>explicit definitions of key terms and then trying to
>falsify their hypothesis through experiment, they
>intentionally leave key terms ambiguous. This allows
>them to adjust definitions of key terms to fit whatever
>point they are trying to make while taking full advantage
>of the normative and emotive (political) value of the terms.
It seems to me you are describing many Global Warming advocates.
>Here is the classic:
>
>"Adam Smith's key insight was that both parties to an
> exchange can benefit and that, so long as cooperation
> is strictly voluntary, no exchange will take place
> unless both parties do benefit." [p. xv, Milton and Rose
> Friedman, FREE TO CHOOSE; AVON, 1979; ISBN 0-380-52548-8]
>
>Although Friedman is one of the most influential economists
>of the twentieth century, he is lying. Economists do not
>even define the word "benefit" -- let alone measure it.
We tend to do things that we believe will be of benefit to us.
(Actually, see the Assumptions above.)
I doubt the trading benefit can be measured. All we know is that if you
invest exertion in trading you expect a return for it. (Otherwise you
wouldn't trade.)
Strangely enough, when goods exchange their value is the same. If I trade
my new 10 speed bicycle for your old pen - at that place and time their
market value was the same. So, why invest exertion in trading when each of
us gets the same value as we gave? All we apparently finish up with is the
same value less the cost of exertion.
As well as market value there is something called personal value - the
Austrians call it subjective value. When your personal value of something
in the market is greater than market value, you'll exchange. If your
personal value is less than market value you won't trade.
The only time a trade will take place is when the personal values of both
traders are greater than market. At the conclusion of the trade, each
traders personal values have increased.
How much - who knows? It's not worth bothering with. A thousand other
trades have occurred while you think about it.
So, Friedman was hardly lying. He was just describing something we all know.
Harry
*****************************
Harry Pollard (818) 352-4141
Henry George School of Los Angeles
Box 655
Tujunga CA 91042
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