Economic Theory

[grasping the after wind]

Semantics.

Words mean things.

 

[quatona]

The economy is base on the exchange of labor through the medium of money. The product or service involved really isn't that important.

So you´d support the idea that the government paying for completely useless work is the way to help the economy?

 

[Resha Caner]

Words mean things.

Sure. And bread has value to me. If it doesn't mean that to you, then the word has different meanings for us. But don't try to tell me what it means to me. It's not as if I'm making up a usage that is unfamiliar.

 

[Resha Caner]

Cool. I am all for public money spent on weapons to be changed into value-creating purposes.

If we could do it without the military, I'd be all for it.

 

[quatona]

If we could do it without the military, I'd be all for it.

So we have the determining factor: If the product helps creating value, it doesn´t matter who it is that is publicly supported. If it doesn´t, it´s wasted money no matter whom the government gives it to.

Anyway, I don´t see how the military is needed for it. It could be any research company. After all, it´s all tax money.

 

[grasping the after wind]

Sure. And bread has value to me. If it doesn't mean that to you, then the word has different meanings for us. But don't try to tell me what it means to me. It's not as if I'm making up a usage that is unfamiliar.

You say bread has value to you then somehow come up with the strange notion that because bread has value to you I have a different meaning of the word value than you do. I do not see how that makes logical sense. Bread is not value and value is not bread. Bread may well have value to you. That is a perfectly reasonable subjective opinion to take but the two are not synonyms. What value you place on a thing is completely subjective the value is not created it is assigned.

 

[Resha Caner]

So we have the determining factor: If the product helps creating value, it doesn´t matter who it is that is publicly supported. If it doesn´t, it´s wasted money no matter whom the government gives it to.

That sounds like a reasonable principle. It might be hard to implement though.

Anyway, I don´t see how the military is needed for it. It could be any research company. After all, it´s all tax money.

Unless it's a philanthropic research organization of some sort, they will be motivated by profit, which drives them to eliminate risk and is thereby counterproductive to a lot of research. I've spent almost 30 years experiencing that.

The military has different objectives, and is therefore willing to take risks that others won't.

 

[quatona]

That sounds like a reasonable principle. It might be hard to implement though.

Most definitely.
Well, I am not a strategist, and I was under the impression that you were asking about economic principles (as opposed to concrete strategies to implement them).

Unless it's a philanthropic research organization of some sort, they will be motivated by profit, which drives them to eliminate risk and is thereby counterproductive to a lot of research. I've spent almost 30 years experiencing that.

The military has different objectives, and is therefore willing to take risks that others won't.

The reason the military isn´t driven by profit and is willing to take risks that others won´t is the very fact that it is 100% government/tax payer funded.

 

[Resha Caner]

What value you place on a thing is completely subjective ...

I never said it wasn't. As for the rest of your statement ... the fact that you don't understand a commonly used business term, and must therefore for some odd reason make it a philosophical issue is something I have absolutely no interest in. Pound away.

 

[Resha Caner]

The reason the military isn´t driven by profit and is willing to take risks that others won´t is the very fact that it is 100% government/tax payer funded.

That might be a factor, but it's not the only one. Another is that once you've been wounded, you're motivated to prevent future wounds. And there's the whole patriotic thing. Finally, the military tends to attract risk takers. Some people are adrenaline junkies, some are very cautious.

 

[quatona]

That might be a factor, but it's not the only one. Another is that once you've been wounded, you're motivated to prevent future wounds. And there's the whole patriotic thing. Finally, the military tends to attract risk takers. Some people are adrenaline junkies, some are very cautious.

So the government has to decide which group is more important to fund financially. Ok.

 

[grasping the after wind]

I never said it wasn't. As for the rest of your statement ... the fact that you don't understand a commonly used business term, and must therefore for some odd reason make it a philosophical issue is something I have absolutely no interest in. Pound away.

Enough of you then Have Fun and God Bless.

 

[OldWiseGuy]

So you´d support the idea that the government paying for completely useless work is the way to help the economy?

The way to help the economy is to recover the capital now circulating in the global economy. Then people can do what they will with it, even haul rocks around.

 

[Eudaimonist]

Is all economic value rooted in labor?

No.

Labor is needed in the vast majority of cases, but it's not enough. There is also a need for resources, know how, and the sort of leadership and social structures needed for production to take place.


eudaimonia,

Mark

 

[quatona]

The way to help the economy is to recover the capital now circulating in the global economy. Then people can do what they will with it, even haul rocks around.

That´s completely besides the point. The initial question was: Does goverment/tax-payer money given to organizations/businesses who pay people for hauling rocks around help the economy?

 

[Ana the Ist]

Sure, there are other interconnected factors. Labor can become more efficient, and thereby we need less of it. As such, I can flip your rhetorical question around: If there is demand, and no labor to meet the demand ...

I'm not sure what you're thinking of as a "demand" without labor?

If you're talking about a job that's needed and few have the skills for it...typically the value of that labor goes up. It goes up because of the demand though.

 

[OldWiseGuy]

That´s completely besides the point. The initial question was: Does goverment/tax-payer money given to organizations/businesses who pay people for hauling rocks around help the economy?

However we spend the money is the economy regardless of any 'value' created.

 

[brainstormer]

Right after the recession, I created something I called New Economy from Nineteen New Educational Principles
You can find it if you search for Concepts for Economic Empowerment by Robert Pearson.

Here is number 14 which relates to the discussion:

14) We should be focusing on "creating value" not only "earning money." For example, imagine digging up some of one's lawn area and preparing the area for a nut and fruit tree orchards and other gardening area. This will create a substantial amount of "wealth" each year for one's household without having to bring in more money to buy things. There are many such improvements one can make and even invent for other people. There are low income but ready now electric car conversions that people have done for virtually every make of car.

 

[OldWiseGuy]

Right after the recession, I created something I called New Economy from Nineteen New Educational Principles
You can find it if you search for Concepts for Economic Empowerment by Robert Pearson.

Here is number 14 which relates to the discussion:

14) We should be focusing on "creating value" not only "earning money." For example, imagine digging up some of one's lawn area and preparing the area for a nut and fruit tree orchards and other gardening area. This will create a substantial amount of "wealth" each year for one's household without having to bring in more money to buy things. There are many such improvements one can make and even invent for other people. There are low income but ready now electric car conversions that people have done for virtually every make of car.

Individuals creating value for themselves by various means without the need for (much) spending has always been going on. However not everyone has the abilities or the desire to do this. I make things myself if what I need is not available, or if the quality of same is so poor that I don't see the value in it, or if I just have a better idea for the thing. I also make things just because I enjoy doing it.

 

[Gene2memE]

Three pages in an no-one has mentioned marginal utility yet? Or exchange value concepts? (OldWiseGuy has come closest, he wins an internet hug). C'mon ladies and gentlemen, this is high school economics.

Consider this quote by Marx - "Nothing can have value, without being an object of utility". Marx was the man that developed the modern formulation of the labour theory of value - which is where most of this discussion has been centered. Yet even he recognised that labour and inputs alone don't comprise the sole basis (or even most of the basis) of value.

The solution to this discussion can be found in economic text books, from the 1870s and 1880s. Look up Jevons, Walras and Menger.