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Showing posts with the label Marx

And the parting on the left is now the parting on the right

I appreciate Marx and Engels more and more over time (although I assure you I am not on the verge of becoming a Marxist!): while they weren't happy with the then current social system, they were scathing about utopians who had not even bothered to understand classical economics and yet were proposing fairy-tale fixes for what ailed the world. I would like to resurrect Engels in particular to unleash his sarcasm on Matthew Hutson of Slate , who seems to think market prices should be arrived at by measuring some objective fact about two things offered on the market, and then making sure their price ratio reflects that measured ratio: "But a quick look at the data shows the limitations of raw smarts and stick-to-itiveness as an explanation for inequality. The income distribution in the United States provides a good example. In 2012 the top 0.01 percent of households earned an average of $10.25 million, while the mean household income for the country overall was $51,000. Are...

The Macroeconomist as Weatherman

Imagine that, over the past 200 years, there have been a bunch of meteorologists studying the weather. What has happened, though, is that one of them, living in Florida, has focused on thunderstorms. He came up with a pretty good model of thunderstorms, but then announced, "The weather is made up of a series of thunderstorms: to be safe, people need to install lots of lightening rods everywhere, and very good drainage so that streets and creeks don't flood." Another fellow lived in Oklahoma, and he focused on tornadoes. He developed a pretty good model of tornadoes, and then declared. "The weather is characterized by periods of calm followed by tornadoes: to remain safe, people need good solid basements and very sturdy wooden shutters." A third meteorologist lived in California. His studies focused on seasonal variations in rain. He developed a good model of those, and then professed that "Human weather problems can be solved, if only people find ways ...