History UsefulNotes / Capitalism

28th Jun '16 9:48:44 PM FurryKef
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For the sake of simplicity modern mainstream economic models assume [[ViewersAreGeniuses a completely rational consumer: one that always looks for the best, lowest price before buying, provided that finding it out isn't too costly]]. Actual human behaviour (sharply) diverges from this assumption because we rarely have perfect information, powers of reasoning, or self-control. Still, it is a necessary asumption.

to:

For the sake of simplicity modern mainstream economic models assume [[ViewersAreGeniuses a completely rational consumer: one that always looks for the best, lowest price before buying, provided that finding it out isn't too costly]]. Actual human behaviour (sharply) diverges from this assumption because we rarely have perfect information, powers of reasoning, or self-control. Still, it is a necessary asumption.
assumption.
26th May '16 8:26:25 PM Akool713
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One sector of the economy where the market consistently fails to deliver cost-efficiency is that of public goods. These are goods such as infrastructure, education, and healthcare which benefit the economy as a whole and everyone it it - but which it is unwise or inefficient to buy or sell in the conventional sense. Another factor is that of externalities, where economic activity benefits or harms those who are not involved in it. For instance, schooling benefits and pollution harms society as a whole.

to:

One sector of the economy where the market consistently fails to deliver cost-efficiency is that of public goods. These are goods such as infrastructure, education, and healthcare which benefit the economy as a whole and everyone it in it - but which it is unwise or inefficient to buy or sell in the conventional sense. Another factor is that of externalities, where economic activity benefits or harms those who are not involved in it. For instance, schooling benefits and pollution harms society as a whole.
25th Apr '16 7:35:01 PM MAI742
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* John Maynard Keynes: Keynes was the most important economist of the 20th century, and was the first to develop Macro-Economic policies capable of flattening out the boom-and-bust cycle. He did more than most, if not all, to get the world out of TheGreatDepression. The first capitalist thinker to seriously propose extensive government intervention in the economy, or at least, the first with a serious following (see the Keynesian schools below). Nearly all major world leaders of capitalist countries, whether on the right or the left, use macroeconomic policies that are, to varying degrees, influenced by Keynes' books. Despite his reputation in some circles as a leftist, he was [[CriticalResearchFailure definitely not]] a socialist. Whereas economists before Keynes were more focused on keeping inflation low, Keynes was [[TheGreatDepression obviously more focused on promoting general economic activity]]. He proposed that deficit spending by government could be used as direct economic stimulus to help get economies out of recessions, and believed that regulation should be used to surgically remove and prevent the market failures which caused the last recession. What Smith is to the basic free-market model, and microeconomics, Keynes is to the basic mixed-market model, and macroeconomics. His most important work is ''The General Theory of Employment, Interest, and Money'' (shortened: ''The General Theory'') in 1936. His lack of micro-economic focus is now agreed to have made his theories imperfect.
* Milton Friedman: Probably the second most important economist of the 20th century. Friedman's ideas have contributed more than anyone else's to the massive stock-market bubbles which resulted in The Great Recession of 2008. Friedman believed that government intervention in the economy was an immoral infringement upon the freedom of its citizens, and developed theories which reflected that view. Where Keynes saw the financial sector as something which had to be restricted in order to avoid distorting and screwing up the 'real' economy, Friedman thought the financial sector could be harnessed to drive spectacular growth. Friedman believed that if banks were not prevented from making risky loans, then an economic boom financed by debt would result. Once this became or threatened to become a crisis, the government would then loan massive amounts of money to the banks so that the real value of the debts would be wiped out and the cycle could begin again. Friedman was an economic adviser to UsefulNotes/RonaldReagan, and he also highly influenced MargaretThatcher and other Neo-Liberal leaders. Basically, he is to Neo-Liberals what Keynes is to Social Liberals and Socialists. Among his most important contributions to economic theory are his "natural rate of unemployment" and what would eventually be called stagflation. [[note]] an economic period of high inflation and rising unemployment, leading to lower growth), saying that trying to prevent one of them will eventually cause ''both'' of them to rise [[/note]] Crucially, he argued that the only tool governments needed to promote growth and prevent depressions was an extremely aggressive use of the money supply ('Monetarist' policy). Though he disagreed with Keynes' methods, he claimed to have been influenced by Keynesian economics and called Keynes' ''The General Theory'' "a great book." He argued that government regulation of the financial sector constituted tyranny and an infringement of 'basic liberties', assuming it didn't outright lead to Commmunism, so he's really popular with Libertarians. He also led to the USA having a solely volunteer military.

to:

* John Maynard Keynes: Keynes was the most important economist of the 20th century, and was the first to develop Macro-Economic policies capable of flattening out the boom-and-bust cycle. He did more than most, if not all, to get the world out of TheGreatDepression. The first capitalist thinker to seriously propose extensive government intervention in the economy, or at least, the first with a serious following (see the Keynesian schools below). Nearly all major world leaders of capitalist countries, whether on the right or the left, use macroeconomic policies that are, to varying degrees, influenced by Keynes' books. Despite his reputation in some circles as a leftist, he was [[CriticalResearchFailure definitely not]] a socialist. Whereas economists before Keynes were more focused on keeping inflation low, Keynes was [[TheGreatDepression obviously more focused on promoting general economic activity]]. He proposed that deficit spending by government could be used as direct economic stimulus to help get economies out of recessions, and believed that regulation should be used to surgically remove and prevent the market failures which caused the last recession. What Smith is to the basic free-market model, and microeconomics, Keynes is to the basic mixed-market model, and macroeconomics. His most important work is ''The General Theory of Employment, Interest, and Money'' (shortened: ''The General Theory'') in 1936. His lack Unfortunately, in the 1950s-70s it transpired that Keynes had underappreciated the role of micro-economic focus is now agreed to have made his theories imperfect.
money in an economy, which brings us to...
* Milton Friedman: Probably the second most important economist of the 20th century. Friedman's ideas have contributed more than anyone else's to the massive stock-market bubbles which resulted in The Great Recession of 2008. Friedman believed started from the position that government intervention in the economy was an immoral infringement upon the freedom of its citizens, and developed theories which reflected and supported that view. Where Keynes saw had determined that the financial sector as something which had to be regulated and restricted in order to avoid prevent it from distorting and screwing up the 'real' economy, but Friedman thought hypothesized that the financial sector could be harnessed to drive spectacular growth. Friedman believed that if banks were not prevented from making risky loans, then enough of these would pay off that an economic boom financed by debt would result. Once this became or threatened to become a crisis, the government would then loan massive amounts of money to the banks so that the real value of the debts would be wiped out and the cycle could begin again. Friedman was an economic adviser to UsefulNotes/RonaldReagan, and he also highly influenced MargaretThatcher and other Neo-Liberal leaders. Basically, he is to Neo-Liberals what Keynes is to Social Liberals and Socialists. Among his most important contributions to economic theory are his "natural rate of unemployment" and what would eventually be called stagflation. [[note]] an economic period of high inflation and rising unemployment, leading to lower growth), saying that trying to prevent one of them will eventually cause ''both'' of them to rise [[/note]] Crucially, he argued that the only tool governments needed to promote growth and prevent depressions was an extremely aggressive use of the money supply ('Monetarist' policy). Though he disagreed with Keynes' methods, he claimed to have been influenced by Keynesian economics and called Keynes' ''The General Theory'' "a great book." He argued that government regulation of the financial sector constituted tyranny and an infringement of 'basic liberties', assuming it didn't outright lead to Commmunism, so he's really popular with Libertarians. He also led to the USA having a solely volunteer military.
25th Apr '16 7:18:04 PM MAI742
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* John Maynard Keynes: Keynes was the most important economist of the 20th century, and was the first to develop Macro-Economic policies capable of flattening out the boom-and-bust cycle. More concretely, he did more than anyone else to get the world out of TheGreatDepression. The first capitalist thinker to seriously propose extensive government intervention in the economy, or at least, the first with a serious following (see the Keynesian schools below). Nearly all major world leaders of capitalist countries, whether on the right or the left, use macroeconomic policies that are, to varying degrees, influenced by Keynes' books. Despite his reputation in some circles as a leftist, he was [[CriticalResearchFailure definitely not]] a socialist. Whereas economists before Keynes were more focused on keeping inflation low, Keynes was [[TheGreatDepression obviously more focused on promoting general economic activity]]. He proposed that deficit spending by government could be used as direct economic stimulus to help get economies out of recessions, and believed that regulation should be used to surgically remove and prevent the market failures which caused the last recession. What Smith is to the basic free-market model, and microeconomics, Keynes is to the basic mixed-market model, and macroeconomics. His most important work is ''The General Theory of Employment, Interest, and Money'' (shortened: ''The General Theory'') in 1936. His lack of micro-economic focus is now agreed to have made his theories imperfect.
* Milton Friedman: Probably the second most important economist of the 20th century. Friedman's ideas have contributed more than anyone else's to The Great Recession of 2008, though they may have been accidentally or wilfully misinterpreted by some policymakers. Friedman agreed with the Keynesian impulse to eliminate the waste and disruption caused by periods of unsustainable economic growth and depressions. However, he totally disagreed with Keynes' methods. Friedman believed that government intervention in the economy was an immoral infringement upon the freedom of its citizens, and developed theories which reflected that view. Where Keynes focused on demand/consumption as the root of all economic activity, Friedman believed that more productive results could be achieved by focusing on production/supply. More specifically, rather than seeing it as something which had to be restricted in order to avoid distorting or screwing up the 'real' economy Friedman thought that the financial sector could be harnessed to drive spectacular growth. Friedman believed that if banks were not prevented from making risky loans, then an economic boom financed by debt would result. Once this inevitably resulted in a crash and general economic crisis, the government should then loan massive amounts of money to the banks so that the real value of the debts would be wiped out and the cycle could begin again. Friedman truly believed that this model would give all the benefits of the 'boom' part of the cycle and none of the downsides of the 'bust'. Friedman was an economic adviser to UsefulNotes/RonaldReagan, and he also highly influenced MargaretThatcher and other Neo-Liberal leaders. Basically, he is to Neo-Liberals what Keynes is to Social Liberals and Socialists. Among his most important contributions to economic theory are his "natural rate of unemployment" and what would eventually be called stagflation (an economic period of high inflation and rising unemployment, leading to lower growth), saying that trying to prevent one of them will eventually cause ''both'' of them to rise. Most importantly, he argued that the only area of the economy that governments should regulate is the monetary supply, which should be controlled extremely aggressively. Though he disagreed with Keynes' methods, he openly said he was influenced by Keynesian economics and called Keynes' ''The General Theory'' "a great book." He argued that government control of the banking sector constituted tyranny and an infringement of 'basic liberties', if not outright lead to Commmunism, so he's really popular with Libertarians. He also led to the USA having a solely volunteer military.

to:

* John Maynard Keynes: Keynes was the most important economist of the 20th century, and was the first to develop Macro-Economic policies capable of flattening out the boom-and-bust cycle. More concretely, he He did more than anyone else most, if not all, to get the world out of TheGreatDepression. The first capitalist thinker to seriously propose extensive government intervention in the economy, or at least, the first with a serious following (see the Keynesian schools below). Nearly all major world leaders of capitalist countries, whether on the right or the left, use macroeconomic policies that are, to varying degrees, influenced by Keynes' books. Despite his reputation in some circles as a leftist, he was [[CriticalResearchFailure definitely not]] a socialist. Whereas economists before Keynes were more focused on keeping inflation low, Keynes was [[TheGreatDepression obviously more focused on promoting general economic activity]]. He proposed that deficit spending by government could be used as direct economic stimulus to help get economies out of recessions, and believed that regulation should be used to surgically remove and prevent the market failures which caused the last recession. What Smith is to the basic free-market model, and microeconomics, Keynes is to the basic mixed-market model, and macroeconomics. His most important work is ''The General Theory of Employment, Interest, and Money'' (shortened: ''The General Theory'') in 1936. His lack of micro-economic focus is now agreed to have made his theories imperfect.
* Milton Friedman: Probably the second most important economist of the 20th century. Friedman's ideas have contributed more than anyone else's to the massive stock-market bubbles which resulted in The Great Recession of 2008, though they may have been accidentally or wilfully misinterpreted by some policymakers. Friedman agreed with the Keynesian impulse to eliminate the waste and disruption caused by periods of unsustainable economic growth and depressions. However, he totally disagreed with Keynes' methods.2008. Friedman believed that government intervention in the economy was an immoral infringement upon the freedom of its citizens, and developed theories which reflected that view. Where Keynes focused on demand/consumption as saw the root of all economic activity, Friedman believed that more productive results could be achieved by focusing on production/supply. More specifically, rather than seeing it financial sector as something which had to be restricted in order to avoid distorting or and screwing up the 'real' economy economy, Friedman thought that the financial sector could be harnessed to drive spectacular growth. Friedman believed that if banks were not prevented from making risky loans, then an economic boom financed by debt would result. Once this inevitably resulted in became or threatened to become a crash and general economic crisis, the government should would then loan massive amounts of money to the banks so that the real value of the debts would be wiped out and the cycle could begin again. Friedman truly believed that this model would give all the benefits of the 'boom' part of the cycle and none of the downsides of the 'bust'.again. Friedman was an economic adviser to UsefulNotes/RonaldReagan, and he also highly influenced MargaretThatcher and other Neo-Liberal leaders. Basically, he is to Neo-Liberals what Keynes is to Social Liberals and Socialists. Among his most important contributions to economic theory are his "natural rate of unemployment" and what would eventually be called stagflation (an stagflation. [[note]] an economic period of high inflation and rising unemployment, leading to lower growth), saying that trying to prevent one of them will eventually cause ''both'' of them to rise. Most importantly, rise [[/note]] Crucially, he argued that the only area of the economy that tool governments should regulate is the monetary supply, which should be controlled needed to promote growth and prevent depressions was an extremely aggressively. aggressive use of the money supply ('Monetarist' policy). Though he disagreed with Keynes' methods, he openly said he was claimed to have been influenced by Keynesian economics and called Keynes' ''The General Theory'' "a great book." He argued that government control regulation of the banking financial sector constituted tyranny and an infringement of 'basic liberties', if not assuming it didn't outright lead to Commmunism, so he's really popular with Libertarians. He also led to the USA having a solely volunteer military.
25th Apr '16 7:11:08 PM MAI742
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To a certain extent, an economy can function without being made (controlled) to do so. If there is competition in a sector of th economy, supply will naturally increase or decrease to meet demand. An important concept at economics' inception in the 18th-19th centuries, The Hand was later discovered to have imperfect reach, dexterity, and strength. The extent to which governments should compensate for the hand's shortcomings is a matter of some debate, with some arguing that the hand should be replaced (Marxists) and others that it should be supplemented by government (Socialists and Social Liberals). Others still contend that the problem is with human behaviour and society, whose failings are marring theoretical perfection of The Hand (Classical Liberals/Neo-Liberals).

to:

To a certain extent, an economy can function without being made (controlled) to do so. If there is competition in a sector of th the economy, supply will naturally increase or decrease to meet demand. An important concept at economics' inception in the 18th-19th centuries, The Hand was later discovered to have imperfect reach, dexterity, and strength. The extent to which governments should compensate for the hand's shortcomings is a matter of some debate, with some arguing that the hand should be replaced (Marxists) and others that it should be supplemented by government (Socialists and Social Liberals). Others still contend that the problem is there are no (big) problems with human behaviour and society, whose failings are marring theoretical perfection of The Hand Hand, or [[JumpingOffTheSlipperySlope that fixing The Hand's problems inevitably leads to a Marxist-type Controlled Economy]] (Classical Liberals/Neo-Liberals).



* John Maynard Keynes: Keynes is one of the most influential economists of the 20th century. The first capitalist thinker to seriously propose extensive government intervention in the economy, or at least, the first with a serious following (see the Keynesian schools below). Nearly all major world leaders of capitalist countries, whether on the right or the left, use macroeconomic policies that are, to varying degrees, influenced by Keynes' books. Despite his reputation in some circles as a leftist, he was [[CriticalResearchFailure definitely not]] a socialist. Whereas economists before Keynes were more focused on keeping inflation low, Keynes was [[TheGreatDepression obviously more focused on economic downturns]]. He proposed that deficit spending by government could be used as direct economic stimulus to help get economies out of recessions, and believed that regulation should be used to surgically remove the economic behaviors that caused the last recession. What Smith is to the basic free-market model, and microeconomics, Keynes is to the basic mixed-market model, and macroeconomics. His most important work is ''The General Theory of Employment, Interest, and Money'' (shortened: ''The General Theory'') in 1936.Most of his ideas fall under the Broken Windows Fallacy.
* Milton Friedman: Probably the second most important economist of the 20th century. Friedman broke the Keynesian domination of economic thinking that had been in place since the 1930's, and brought back the free-market principles of Adam Smith. He was an economic adviser to UsefulNotes/RonaldReagan, and he also highly influenced MargaretThatcher and other right-leaning leaders. Basically, he is to the right what Keynes is to the left. Among his most important contributions to economics are his theory of a "natural rate of unemployment" and what would eventually be called stagflation (an economic period of high inflation and rising unemployment, leading to lower growth), saying that trying to prevent one of them will eventually cause ''both'' of them to rise. Most importantly, he argued that the only area of the economy that governments should regulate is the monetary supply, which should be controlled aggressively. Often called the leading opponent to Keynes; this isn't really true, and Friedman, though he disagreed with Keynes' "initial" conclusions, openly said he was influenced by Keynesian economics and called Keynes' ''The General Theory'' "a great book." He argued that increased government influence in the economy would undermine basic liberties, so he's really popular with Libertarians. He also led to the US having a solely volunteer military, by the way.

to:

* John Maynard Keynes: Keynes is one of was the most influential economists important economist of the 20th century.century, and was the first to develop Macro-Economic policies capable of flattening out the boom-and-bust cycle. More concretely, he did more than anyone else to get the world out of TheGreatDepression. The first capitalist thinker to seriously propose extensive government intervention in the economy, or at least, the first with a serious following (see the Keynesian schools below). Nearly all major world leaders of capitalist countries, whether on the right or the left, use macroeconomic policies that are, to varying degrees, influenced by Keynes' books. Despite his reputation in some circles as a leftist, he was [[CriticalResearchFailure definitely not]] a socialist. Whereas economists before Keynes were more focused on keeping inflation low, Keynes was [[TheGreatDepression obviously more focused on promoting general economic downturns]]. activity]]. He proposed that deficit spending by government could be used as direct economic stimulus to help get economies out of recessions, and believed that regulation should be used to surgically remove and prevent the economic behaviors that market failures which caused the last recession. What Smith is to the basic free-market model, and microeconomics, Keynes is to the basic mixed-market model, and macroeconomics. His most important work is ''The General Theory of Employment, Interest, and Money'' (shortened: ''The General Theory'') in 1936.Most His lack of micro-economic focus is now agreed to have made his ideas fall under the Broken Windows Fallacy.
theories imperfect.
* Milton Friedman: Probably the second most important economist of the 20th century. Friedman's ideas have contributed more than anyone else's to The Great Recession of 2008, though they may have been accidentally or wilfully misinterpreted by some policymakers. Friedman broke agreed with the Keynesian domination impulse to eliminate the waste and disruption caused by periods of unsustainable economic thinking growth and depressions. However, he totally disagreed with Keynes' methods. Friedman believed that government intervention in the economy was an immoral infringement upon the freedom of its citizens, and developed theories which reflected that view. Where Keynes focused on demand/consumption as the root of all economic activity, Friedman believed that more productive results could be achieved by focusing on production/supply. More specifically, rather than seeing it as something which had been to be restricted in place since order to avoid distorting or screwing up the 1930's, 'real' economy Friedman thought that the financial sector could be harnessed to drive spectacular growth. Friedman believed that if banks were not prevented from making risky loans, then an economic boom financed by debt would result. Once this inevitably resulted in a crash and brought back general economic crisis, the free-market principles government should then loan massive amounts of Adam Smith. He money to the banks so that the real value of the debts would be wiped out and the cycle could begin again. Friedman truly believed that this model would give all the benefits of the 'boom' part of the cycle and none of the downsides of the 'bust'. Friedman was an economic adviser to UsefulNotes/RonaldReagan, and he also highly influenced MargaretThatcher and other right-leaning Neo-Liberal leaders. Basically, he is to the right Neo-Liberals what Keynes is to the left. Social Liberals and Socialists. Among his most important contributions to economics economic theory are his theory of a "natural rate of unemployment" and what would eventually be called stagflation (an economic period of high inflation and rising unemployment, leading to lower growth), saying that trying to prevent one of them will eventually cause ''both'' of them to rise. Most importantly, he argued that the only area of the economy that governments should regulate is the monetary supply, which should be controlled extremely aggressively. Often called the leading opponent to Keynes; this isn't really true, and Friedman, though Though he disagreed with Keynes' "initial" conclusions, methods, he openly said he was influenced by Keynesian economics and called Keynes' ''The General Theory'' "a great book." He argued that increased government influence in control of the economy would undermine basic liberties, banking sector constituted tyranny and an infringement of 'basic liberties', if not outright lead to Commmunism, so he's really popular with Libertarians. He also led to the US USA having a solely volunteer military, by the way.military.
23rd Apr '16 5:10:05 AM MAI742
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Marxists, Socialists and Social Liberals, and Neo-Liberals disagree on what constitutes a market failure. Unsurprisingly, Marxists consider them damning indictments of the entire Capitalist system and definitive proof of the need for a government-directed economy. Socialists and Social Liberals believe that market failures must be addressed in order to ensure the smooth functioning of Capitalism, which they consider a flawed but still workable system. Lastly, Neo-Liberals consider few if any market failures to be worth addressing, as they consider Capitalism a (near-)perfect system which is being failed by present-day human values and society.

to:

Marxists, Socialists and Social Liberals, and Neo-Liberals disagree on what constitutes a market failure. Unsurprisingly, Marxists consider see them everywhere, considering them damning indictments of the entire Capitalist system and definitive proof of the need for a government-directed economy. Socialists and Social Liberals believe that market failures must be addressed in order see many, believing there is much room for government intervention to ensure the smooth functioning of Capitalism, which they consider a flawed but still workable system. Lastly, over the obvious flaws in Capitalism. Neo-Liberals consider see few if any market failures to be worth addressing, as they consider or none, holding that Capitalism is a (near-)perfect system which is being failed by present-day human values and society.
23rd Apr '16 5:06:48 AM MAI742
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The definition of Capitalism accepted by most is a system wherein certain individuals (the capitalist class) own the means of production and guide the economy. Various competing definitions have been created by supporters of capitalism and opposers of capitalism, but they are irrelevant here.

to:

The definition of Capitalism accepted by most is a system wherein certain individuals (the capitalist class) own the 'the means of production production' and guide the economy. Various competing definitions have been created by supporters of capitalism and opposers of capitalism, but they are irrelevant here.



First of all, we must note that all modern mainstream economic models assume [[ViewersAreGeniuses a completely rational consumer. One that would always look for the best, lowest price before buying, provided that finding it out isn't too costly]]. This assumption is the basis for almost everything coming up.

to:

First For the sake of all, we must note that all simplicity modern mainstream economic models assume [[ViewersAreGeniuses a completely rational consumer. One consumer: one that would always look looks for the best, lowest price before buying, provided that finding it out isn't too costly]]. This Actual human behaviour (sharply) diverges from this assumption because we rarely have perfect information, powers of reasoning, or self-control. Still, it is the basis for almost everything coming up.
a necessary asumption.



The concept behind the invisible hand is if there is competition in an economy, each member of that economy can pursue their own self-interests and create general prosperity for all. An important concept early in the history of economic thought, this is a contested idea today.

to:

The concept behind the invisible hand is if To a certain extent, an economy can function without being made (controlled) to do so. If there is competition in an a sector of th economy, each member of that economy can pursue their own self-interests and create general prosperity for all. supply will naturally increase or decrease to meet demand. An important concept early at economics' inception in the history of economic thought, this 18th-19th centuries, The Hand was later discovered to have imperfect reach, dexterity, and strength. The extent to which governments should compensate for the hand's shortcomings is a contested idea today.
matter of some debate, with some arguing that the hand should be replaced (Marxists) and others that it should be supplemented by government (Socialists and Social Liberals). Others still contend that the problem is with human behaviour and society, whose failings are marring theoretical perfection of The Hand (Classical Liberals/Neo-Liberals).



The price of something is determined by supply and demand. A higher quantity of a product means it is less likely a buyer will pay an outrageous amount of money for it because they can walk down the street and get it for a cheaper price. If the seller is the only one in possession of the product then that seller is the only way the buyer can get the product. If the buyer refuses to pay the seller's price the seller will just move onto a different customer who is willing to buy it.

If there is high demand for a product sellers can get more money out of the product because if desired badly enough buyers will pay whatever price. If there isn't high demand for a product sellers are forced to lower prices[[note]]or expand advertising[[/note]] in order to raise demand.

Higher demand for a product causes the price to go up. Less demand for a product cause the price to go down. Higher supply of a product causes the price to go down. Lower supply of a product causes the price to go up.

to:

The price All economic activity is the product of something is the abstract factors of demand and supply. These manifest themselves as the physical actions of consumption and production, respectively.

Prices are
determined by supply and demand. A higher quantity of a product means it is less likely a buyer will pay an outrageous amount of money for it because they can walk down the street and get it for a cheaper price. If the seller is the only one in possession of the product then that seller is the only way the buyer can get the product. If the buyer refuses to pay the seller's price the seller will just move onto a different customer who is willing to buy it.

If there is high
demand for a product and supply, of which demand is more important. High demand allows sellers can get more money out of the product because to sell products for high prices. But if desired badly enough buyers will pay whatever price. If there isn't high demand for a product product, sellers are forced to lower prices[[note]]or expand advertising[[/note]] in order have incentives to raise demand.

Higher
demand for that product (e.g. advertising), reduce production, (as a last resort) lower prices, or some combination thereof. However, for when modelling general activity it is often simplest to assume that prices are determined solely by the relationship between supply and demand.

Or in short, higher
demand for a product causes the price to go up. Lower supply of a product also causes the price to go up. Less demand for a product can cause the price to go down. Higher supply of a product causes can likewise cause the price to go down. Lower supply of a product causes the price to go up.
down.






Market failures are instances when the market left alone does not produce the most efficient system to be put in place. The classical market failures are public goods[[note]]Goods that are non-excludable (such as public roads and bridges that one cannot easily restrict the use of)[[/note]], externalities[[note]]production or consumption of a good has spillover costs or effects not borne by producer or consumer. Schooling has positive externalities; pollution is a common negative externality[[/note]], and natural monopoly[[note]]Due to increasing returns to scale, it is most efficient to have a single producer of the good. Utility companies, which have enormous fixed costs in plants and machinery, are the typical natural monopoly[[/note]]. Left and right-wing economists have differing opinions on what constitutes a market failure. The general tendency among left-wing economists is to see more market failures, and to hold an optimistic view of government intervention, and the tendency among the right is to see fewer market failures, and to see more government failures when government chooses to intervene. Due to market failures, the existence of the invisible hand is debated by capitalists and anti-capitalists alike.

to:

Market failures are instances when sectors of the economy where Invisible Hand simply does not work, and tendencies within economies as a whole which prevent the smooth functioning of the Invisible Hand without government intervention.

One sector of the economy where
the market left alone does consistently fails to deliver cost-efficiency is that of public goods. These are goods such as infrastructure, education, and healthcare which benefit the economy as a whole and everyone it it - but which it is unwise or inefficient to buy or sell in the conventional sense. Another factor is that of externalities, where economic activity benefits or harms those who are not produce involved in it. For instance, schooling benefits and pollution harms society as a whole.

Finally, in the wider economy there is a natural tendency towards the formation of monopolies (one party is the sole producer of a good) and cartels (all producers of a good cooperate to set production and prices). The first cause is the drive towards profit: cooperation or merger with rival producers is more profitable than competition. Secondly, larger operations are more efficient. Efficiency begets efficiency until ultimately,
the most efficient system to be put in place. The classical market failures are public goods[[note]]Goods that are non-excludable (such as public roads form of production - monopoly - results. Both monopolies and bridges that one cannot easily restrict cartels give sellers the use of)[[/note]], externalities[[note]]production or consumption power to dictate prices independently of a good has spillover costs or effects not borne by producer or consumer. Schooling has positive externalities; pollution is a common negative externality[[/note]], and natural monopoly[[note]]Due to increasing returns to scale, it is most efficient to have a single producer of demand, which the good. desire for profit encourages them to exercise. Utility companies, which have enormous fixed costs in plants and machinery, are the typical natural monopoly[[/note]]. Left monopoly.

Marxists, Socialists
and right-wing economists have differing opinions Social Liberals, and Neo-Liberals disagree on what constitutes a market failure. The general tendency among left-wing economists is to see more Unsurprisingly, Marxists consider them damning indictments of the entire Capitalist system and definitive proof of the need for a government-directed economy. Socialists and Social Liberals believe that market failures, and to hold an optimistic view of government intervention, and the tendency among the right is to see fewer market failures, and to see more government failures when government chooses must be addressed in order to intervene. Due to ensure the smooth functioning of Capitalism, which they consider a flawed but still workable system. Lastly, Neo-Liberals consider few if any market failures, failures to be worth addressing, as they consider Capitalism a (near-)perfect system which is being failed by present-day human values and society.

Lately, realisations of the true extent of market failures have caused
the existence of the invisible hand is to become debated by capitalists and anti-capitalists alike.
25th Jan '16 9:31:46 AM DDRMASTERM
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*** There is even some debate as to what someone can actually own, such as intellectual property. Supporters say that as it was made by someone, the idea belongs to the creator. If creators did not own their own ideas other people could steal them and use someone else's ideas to make a lot of money at the expense of the creator. For example, if Alice were a small businesswoman who discovered a way to manufacture cars more efficiently, Bob, who already has a big business and thus all of the infrastructure in place, could take Alice's idea and apply it to his own plants. Now Alice has payed the R&D costs for the research but Bob is the one making the money on her idea. Opponents say that the reason we have property in the first place is to manage finite resources and define property as "something one person owns to the exclusion of other people owning it." For example, if Alice owned a pencil Bob could not use that pencil without first taking it from Alice. Ideas, on the other hand, are infinite, that is one person can have it and someone else can use it without diminishing the first person's 'ownership' of it. For example, if Alice owned a book and Bob copied it onto his own paper, both of them can still enjoy the book.It has also been studied multiple times as to whether or IP laws help innovation, with most studies actually showing neutral or negative effect.

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*** There is even some debate as to what someone can actually own, such as intellectual property. Supporters say that as it was made by someone, the idea belongs to the creator. If creators did not own their own ideas other people could steal them and use someone else's ideas to make a lot of money at the expense of the creator. For example, if Alice were a small businesswoman who discovered a way to manufacture cars more efficiently, Bob, who already has a big business and thus all of the infrastructure in place, could take Alice's idea and apply it to his own plants. Now Alice has payed the R&D costs for the research but Bob is the one making the money on her idea. Opponents say that the reason we have property in the first place is to manage finite resources and define property as "something one person owns to the exclusion of other people owning it." For example, if Alice owned a pencil Bob could not use that pencil without first taking it from Alice. Ideas, on the other hand, are infinite, that is one person can have it and someone else can use it without diminishing the first person's 'ownership' of it. For example, if Alice owned a book and Bob copied it onto his own paper, both of them can still enjoy the book. It has also been studied multiple times as to whether or IP laws help innovation, with most studies actually showing neutral or negative effect.
25th Jan '16 9:31:15 AM DDRMASTERM
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*** There is even some debate as to what someone can actually own, such as intellectual property. Supporters say that as it was made by someone, the idea belongs to the creator. If creators did not own their own ideas other people could steal them and use someone else's ideas to make a lot of money at the expense of the creator. For example, if Alice were a small businesswoman who discovered a way to manufacture cars more efficiently, Bob, who already has a big business and thus all of the infrastructure in place, could take Alice's idea and apply it to his own plants. Now Alice has payed the R&D costs for the research but Bob is the one making the money on her idea. Opponents say that the reason we have property in the first place is to manage finite resources and define property as "something one person owns to the exclusion of other people owning it." For example, if Alice owned a pencil Bob could not use that pencil without first taking it from Alice. Ideas, on the other hand, are infinite, that is one person can have it and someone else can use it without diminishing the first person's 'ownership' of it. For example, if Alice owned a book and Bob copied the it onto his own paper, both of them can still enjoy the book.It has also been studied multiple times as to whether or IP laws help innovation, with most studies actually showing neutral or negative effect.

to:

*** There is even some debate as to what someone can actually own, such as intellectual property. Supporters say that as it was made by someone, the idea belongs to the creator. If creators did not own their own ideas other people could steal them and use someone else's ideas to make a lot of money at the expense of the creator. For example, if Alice were a small businesswoman who discovered a way to manufacture cars more efficiently, Bob, who already has a big business and thus all of the infrastructure in place, could take Alice's idea and apply it to his own plants. Now Alice has payed the R&D costs for the research but Bob is the one making the money on her idea. Opponents say that the reason we have property in the first place is to manage finite resources and define property as "something one person owns to the exclusion of other people owning it." For example, if Alice owned a pencil Bob could not use that pencil without first taking it from Alice. Ideas, on the other hand, are infinite, that is one person can have it and someone else can use it without diminishing the first person's 'ownership' of it. For example, if Alice owned a book and Bob copied the it onto his own paper, both of them can still enjoy the book.It has also been studied multiple times as to whether or IP laws help innovation, with most studies actually showing neutral or negative effect.
24th Jan '16 1:08:08 PM jate88
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Market failures are instances when the market left alone does not produce the most efficient system to be put in place. It is hotly debated whether or not market failures do exist without government involvement; the classical market failures are public goods[[note]]Goods that are non-excludable (such as public roads and bridges that one cannot easily restrict the use of)[[/note]], externalities[[note]]production or consumption of a good has spillover costs or effects not borne by producer or consumer. Schooling has positive externalities; pollution is a common negative externality[[/note]], and natural monopoly[[note]]Due to increasing returns to scale, it is most efficient to have a single producer of the good. Utility companies, which have enormous fixed costs in plants and machinery, are the typical natural monopoly[[/note]]. Left and right-wing economists have differing opinions on what constitutes a market failure. The general tendency among left-wing economists is to see more market failures, and to hold an optimistic view of government intervention, and the tendency among the right is to see fewer market failures, and to see more government failures when government chooses to intervene. Due to market failures, the existence of the invisible hand is debated by capitalists and anti-capitalists alike.

to:

Market failures are instances when the market left alone does not produce the most efficient system to be put in place. It is hotly debated whether or not market failures do exist without government involvement; the The classical market failures are public goods[[note]]Goods that are non-excludable (such as public roads and bridges that one cannot easily restrict the use of)[[/note]], externalities[[note]]production or consumption of a good has spillover costs or effects not borne by producer or consumer. Schooling has positive externalities; pollution is a common negative externality[[/note]], and natural monopoly[[note]]Due to increasing returns to scale, it is most efficient to have a single producer of the good. Utility companies, which have enormous fixed costs in plants and machinery, are the typical natural monopoly[[/note]]. Left and right-wing economists have differing opinions on what constitutes a market failure. The general tendency among left-wing economists is to see more market failures, and to hold an optimistic view of government intervention, and the tendency among the right is to see fewer market failures, and to see more government failures when government chooses to intervene. Due to market failures, the existence of the invisible hand is debated by capitalists and anti-capitalists alike.
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