History UsefulNotes / Economics

5th Jun '16 6:26:49 PM TheBigBopper
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This violent collision leaves a few absolutes to take refuge behind, and a wide open mine field for catastrophic assumptions and mistakes, and prime FlameBait. There are a fair number of widely divergent economic schools of thought, each with a reasonable claim to accuracy, and each which believes the others to fail economics forever. The major difference between this schools is in what they decide to grossly oversimplify in their bid to understand something. This is probably one of the reasons why economics is sometimes called "the dismal science". (And few agree on that term... Economists will claim their science isn't dismal, and many other fields will claim it's not a science. The dance goes on.) [[note]]The origin of the term, "the dismal science" for economics, is from how during the time of slavery, John Stuart Mill and his fellow economists supported the equality between all men and the abolishment of the slavery, and Thomas Carlyle was afraid that the economics would cause the decadence of the society. [[http://aprendeenlinea.udea.edu.co/revistas/index.php/lecturasdeeconomia/article/viewFile/7874/7415 Source (in Spanish)]][[/note]].

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This violent collision leaves a few absolutes to take refuge behind, and a wide open mine field for catastrophic assumptions and mistakes, and prime FlameBait. There are a fair number of widely divergent economic schools of thought, each with a reasonable claim to accuracy, and each which believes the others to fail economics forever. The major difference between this these schools is in what they decide to grossly oversimplify in their bid to understand something. This is probably one of the reasons why economics is sometimes called "the dismal science". (And few agree on that term... Economists will claim their science isn't dismal, and many other fields will claim it's not a science. The dance goes on.) [[note]]The origin of the term, "the dismal science" for economics, is from how during the time of slavery, John Stuart Mill and his fellow economists supported the equality between all men and the abolishment of the slavery, and Thomas Carlyle was afraid that the economics would cause the decadence of the society. [[http://aprendeenlinea.udea.edu.co/revistas/index.php/lecturasdeeconomia/article/viewFile/7874/7415 Source (in Spanish)]][[/note]].
15th Apr '16 11:30:57 PM Adeon
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** All economies are 'unhealthy'.
17th Mar '16 8:27:15 PM Bissek
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** ''Destruction Equals Employment'': or when someone says "breaking windows is good for the economy because people will then buy new windows, thus increasing business done by glaziers." The ignored opportunity cost is that the money used to repair windows could've been used to buy other things and the business would've gone to other merchants. On a larger scale, the belief that "war is economically productive" ignores the opportunity cost of spending resources on building bombs instead of building something else. Of course, this is profitable for the arms industry, but for the economy as a whole it isn't. There's also the minor matter that society's poorer by what was destroyed; the resources spent replacing it are used to restore lost wealth, and the society will not be able to recover whatever the damaged areas would have produced in the time between the destruction and the rebuilding had they not been damaged in the first place. A ''Raubwirtschaft'' economy based on plunder often works in the short term (Assuming the nation in question is successful in plundering others - attempting this economic model while being unable to seize resources from outside sources is worse than useless) but is unsustainable in the long run as existing territory becomes depleted of resources and conquering new territories is not possible - or would cost you more than you could rob. Cases in point: TheRomanEmpire and ThoseWackyNazis.

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** ''Destruction Equals Employment'': or when someone says "breaking windows is good for the economy because people will then buy new windows, thus increasing business done by glaziers." The ignored opportunity cost is that the money used to repair windows could've been used to buy other things and the business would've gone to other merchants. On a larger scale, the belief that "war is economically productive" ignores the opportunity cost of spending resources on building bombs instead of building something else. Of course, this is profitable for the arms industry, but for the economy as a whole it isn't. There's also the minor matter that society's poorer by what was destroyed; the resources spent replacing it are used to restore lost wealth, and the society will not be able to recover whatever the damaged areas would have produced in the time between the destruction and the rebuilding had they not been damaged in the first place.place (A bombed factory will not produce anything while being repaired, so if it takes a week to repair the damage from a bomb, the company doing the repairs might be better off, but the company that owns the factory is poorer by both the repair bill and the loss of a week's production). A ''Raubwirtschaft'' economy based on plunder often works in the short term (Assuming the nation in question is successful in plundering others - attempting this economic model while being unable to seize resources from outside sources is worse than useless) but is unsustainable in the long run as existing territory becomes depleted of resources and conquering new territories is not possible - or would cost you more than you could rob. Cases in point: TheRomanEmpire and ThoseWackyNazis.
17th Mar '16 8:20:19 PM Bissek
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** ''Destruction Equals Employment'': or when someone says "breaking windows is good for the economy because people will then buy new windows, thus increasing business done by glaziers." The ignored opportunity cost is that the money used to repair windows could've been used to buy other things and the business would've gone to other merchants. On a larger scale, the belief that "war is economically productive" ignores the opportunity cost of spending resources on building bombs instead of building something else. Of course, this is profitable for the arms industry, but for the economy as a whole it isn't. There's also the minor matter that society's poorer by what was destroyed; the resources spent replacing it are used to restore lost wealth. A ''Raubwirtschaft'' economy based on plunder often works in the short term but is unsustainable in the long run as existing territory becomes depleted of resources and conquering new territories is not possible - or would cost you more than you could rob. Cases in point: TheRomanEmpire and ThoseWackyNazis.

to:

** ''Destruction Equals Employment'': or when someone says "breaking windows is good for the economy because people will then buy new windows, thus increasing business done by glaziers." The ignored opportunity cost is that the money used to repair windows could've been used to buy other things and the business would've gone to other merchants. On a larger scale, the belief that "war is economically productive" ignores the opportunity cost of spending resources on building bombs instead of building something else. Of course, this is profitable for the arms industry, but for the economy as a whole it isn't. There's also the minor matter that society's poorer by what was destroyed; the resources spent replacing it are used to restore lost wealth. wealth, and the society will not be able to recover whatever the damaged areas would have produced in the time between the destruction and the rebuilding had they not been damaged in the first place. A ''Raubwirtschaft'' economy based on plunder often works in the short term (Assuming the nation in question is successful in plundering others - attempting this economic model while being unable to seize resources from outside sources is worse than useless) but is unsustainable in the long run as existing territory becomes depleted of resources and conquering new territories is not possible - or would cost you more than you could rob. Cases in point: TheRomanEmpire and ThoseWackyNazis.
14th Mar '16 10:40:53 AM ayjazz
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As for homo reciprocans, in real life, a human may buy from a firm, or sell to someone someone that has "done wrong" in someone else's eyes, [[ValuesDissonance but they may either not see it as wrong]], may not even ''know'' about the wrong doing, feel that the issue isn't something they could change, [[ApatheticCitizens or they simply]] [[TheyJustDidntCare do not care about it.]] Another possibility is that a person might support a boycotted business due to [[TheComplainerIsAlwaysWrong beliefs that the boycotters]] [[https://en.wikipedia.org/wiki/Chick-fil-A_same-sex_marriage_controversy#Chick-fil-A_Appreciation_Day are the ones that are wrong.]] Another wrench in the homo reciprocans idea is that a human being might be in a position in which the costs of helping the community would be too high for them to handle. A person might shop at a big box store because of cheaper prices that they can afford, even though a better choice for the community would be the mom and pop shop in the neighborhood. However, since they cannot afford the latter, they'll do business with the former.

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As for homo reciprocans, in real life, a human may buy from a firm, or sell to someone someone that has "done wrong" in someone else's eyes, [[ValuesDissonance but they may either not see it as wrong]], may not even ''know'' about the wrong doing, feel that the issue isn't something they could change, [[ApatheticCitizens or they simply]] [[TheyJustDidntCare do not care about it.]] Another possibility is In someways, the boycott can backfire if there are enough people that a person might will support a boycotted business due to [[TheComplainerIsAlwaysWrong beliefs that the boycotters]] [[https://en.wikipedia.org/wiki/Chick-fil-A_same-sex_marriage_controversy#Chick-fil-A_Appreciation_Day are the ones that are wrong.]] Another wrench in the homo reciprocans idea is that a human being might be in a position in which the costs of helping the community would be too high for them to handle. A person might shop at a big box store because of cheaper prices that they can afford, even though a better choice for the community would be the mom and pop shop in the neighborhood. However, since they cannot afford the latter, they'll do business with the former.
11th Jan '16 10:36:48 AM ayjazz
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This violent collision leaves a few absolutes to take refuge behind, and a wide open mine field for catastrophic assumptions and mistakes, and prime FlameBait. There are a fair number of widely divergent economic schools of thought, each with a reasonable claim to accuracy, and each which believes the others to fail economics forever. The major difference between this schools is in what they decide to grossly oversimplify in their bid to understand something. This is probably one of the reasons Thomas Carlyle called economics "the dismal science". (And few agree on that term... Economists will claim their science isn't dismal, and many other fields will claim it's not a science. The dance goes on.) [[note]]Actually the reason why Carlyle called the economics "the dismal science" was because John Stuart Mill and his fellow economists supported the equality between all men and the abolishment of the slavery, and Carlyle was afraid that the economics would cause the decadence of the society. [[http://aprendeenlinea.udea.edu.co/revistas/index.php/lecturasdeeconomia/article/viewFile/7874/7415 Source (in Spanish)]][[/note]].

to:

This violent collision leaves a few absolutes to take refuge behind, and a wide open mine field for catastrophic assumptions and mistakes, and prime FlameBait. There are a fair number of widely divergent economic schools of thought, each with a reasonable claim to accuracy, and each which believes the others to fail economics forever. The major difference between this schools is in what they decide to grossly oversimplify in their bid to understand something. This is probably one of the reasons Thomas Carlyle called why economics is sometimes called "the dismal science". (And few agree on that term... Economists will claim their science isn't dismal, and many other fields will claim it's not a science. The dance goes on.) [[note]]Actually [[note]]The origin of the reason why Carlyle called the economics term, "the dismal science" was because for economics, is from how during the time of slavery, John Stuart Mill and his fellow economists supported the equality between all men and the abolishment of the slavery, and Thomas Carlyle was afraid that the economics would cause the decadence of the society. [[http://aprendeenlinea.udea.edu.co/revistas/index.php/lecturasdeeconomia/article/viewFile/7874/7415 Source (in Spanish)]][[/note]].
14th Oct '15 9:57:15 AM chc232323
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Added DiffLines:

** Finally, as a resource becomes less available to meet demand, the incentives to develop replacements rises. Furthermore, science reveals new methods to replace those resources over time, and demand for replacements can lead to the necessary R&D to make those replacements more efficient. Fossil fuels serve as an excellent example. Humans don't necessarily want oil and coal; we want warm houses, the power to move our vehicles, lubricants, plastics, and other products that are based on fossil fuels. As the costs - including pollution, environmental damage, and moral concerns - of these fuels rise, the incentive to meet those needs in other manners rises.
28th Sep '15 12:57:20 PM BoredMe
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Added DiffLines:

*** Needless to say, there's one flaw in this potential concern: The fact that the United States is, by far, the most militarily powerful nation on Earth.
18th Sep '15 7:45:07 AM FordPrefect
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However these concepts are used to describe behaviors and concepts in an economic system and not necessarily does it describe how things will play out in reality. Human beings can be one side at times, the other side at other times, or some wild combination. Human beings may try to purchase or sell at the best price for them possible, but they may buy a product that is cheaper because it is cheaper, then have it cause trouble for them and cost more in the long run due to low quality, or perhaps a person might buy from from a producer because they are friends with the producer, and not because of product/service quality or price, or they prefer that brand due to false perceptions, or they simply don't have the time or resources available to research the best possible trade and are picking this one out of convenience, or they believe it is a better buy due to some other reason, be that reason be rational or not. A criticism of homo economicus is that real humans do not always know what is best for them in the long-run, and may perform an action due to its short term benefits, but run into problems when unforeseen (or willfully ignored) long-term costs rear their ugly heads. Also, homo economicus runs on the idea of actors having perfect information available, while real humans do not.

to:

However these concepts are used to describe behaviors and concepts in an economic system and do not necessarily does it describe how things will play out in reality. Human beings can be one side at times, the other side at other times, or some wild combination. Human beings may try to purchase or sell at the best price for them possible, but they may buy a product that is cheaper because it is cheaper, then have it cause trouble for them and cost more in the long run due to low quality, or perhaps a person might buy from from a producer because they are friends with the producer, and not because of product/service quality or price, or they prefer that brand due to false perceptions, or they simply don't have the time or resources available to research the best possible trade and are picking this one out of convenience, or they believe it is a better buy due to some other reason, be that reason be rational or not. A criticism of homo economicus is that real humans do not always know what is best for them in the long-run, and may perform an action due to its short term benefits, but run into problems when unforeseen (or willfully ignored) long-term costs rear their ugly heads. Also, homo economicus runs on the idea of actors having perfect information available, while real humans do not.
18th Sep '15 7:38:48 AM FordPrefect
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# '''Third World Countries: Paradise of rich nations' investments''': Ah... Third World Countries, with their cheap labor supply, lax regulations, and prime materials just waiting to get exploited. With such advantages, wouldn't the average Joe invest his life savings into opening a business in say... Somalia? As you probably answered... not so, normally, the reason labor is cheap in [=TWC=]s is because the workforce is also unskilled, lax regulations also usually mean a high crime rate or even political instability. That's why it's usually the big businesses the ones that take the plunge to do the tremendous investments in [=TWC=]s, since they can absorb the cost of giving training to the workforce and providing security for their investments.

to:

# '''Third World Countries: Paradise of rich nations' investments''': Ah... Third World Countries, with their cheap labor supply, lax regulations, and prime materials just waiting to get exploited. With such advantages, wouldn't the average Joe invest his life savings into opening a business in say... Somalia? As you probably answered... not so, normally, the reason labor is cheap in [=TWC=]s is because the workforce is also unskilled, lax regulations also usually mean a high crime rate or even political instability. That's why it's usually the big businesses the ones that take the plunge to do the tremendous investments in [=TWC=]s, since they can absorb the cost of giving training to the workforce and providing security for their investments.
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