On Feb 6, 2013, at 9:52 AM, Jim Devine wrote: > Mathematical Vindication of Ricardo on Machinery > > by Samuelson, Paul A > > Abstract > Ricardo is shown to be right that machinery can hurt wages and reduce > output. A dramatic robot example reveals Knut Wicksell's error in > believing that Pareto optimality calls for no drop in total output > from a viable invention. Under Ricardo's axiom that labor supply > adjusts to keep wages at the subsistence level, he can correctly > deduce on a market-clearing basis a rise in his net product (rent plus > interest), while the greater drop in population and total wages > results in a reduction in his gross product (rent plus interest plus > wages). Copyright 1988 by University of Chicago Press.
What pure and TIMELESS neoclassical nonsense! The presumed decline in population because wages fall below "subsistence" (Ricardo includes the cost of raising children in subsistence) is portrayed as INSTANTANEOUS (if the process was assumed to be taking place in time, the mechanism would take a GENERATION to be effective)! _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
