In 1996 (the year of his Nobel Prize—and of his death), William Vickrey wrote the Fifteen Fallacies of Financial Fundamentalism, where he questioned the notions that budget deficits impoverish future generations, savings stimulate investment, government borrowing competes with private investment, policy should target the NAIRU, and structural policies are the best means to reduce unemployment.
By: Andrea Terzi
When real values transfer by contract
Social systems organized within a system of property rights and a hierarchy relationship between the state and the people provide the setting for a powerful stream of contractual (legally enforceable) transactions. These provide by far the most important (yet not unique) platform for giving and receiving values in modern economies. Read the rest of this entry »
By: Andrea Terzi
Private and commonly shared measures of value
Under any of the three means of transferring values discussed above, anyone giving or receiving subjectively measures the values of the objects exchanged: each individual, whether acting by force, gift, or contract, has a private belief of what something is worth. In hierarchy and gift-with-reciprocity systems, value may indeed remain exclusively an individual estimate of worthiness, as these systems can function with no commonly shared and publicly known measures of value, or “prices.” Read the rest of this entry »
The third Mecpoc Symposium was held on April 20, 2010, at Franklin College Switzerland. The proceedings consist of papers submitted by the guest speakers and transcripts of the speakers’ remarks.
By: Andrea Terzi
Labor and output
For value to be transferred (in any of the transferring systems described above), it must first be created. Creation of value in a social system is a process by which something that some people care about receiving is made available to the transferring process. Newly created valuable entities include the provision of labor services, i.e., human effort at the disposal of another person or production unit, and the output of a production process. Read the rest of this entry »
U.S. Treasury Secretary Geithner warned that the national debt, now standing at $14 trillion, will (some time between March and May) hit the limit set by U.S. Congress last year at $14.3 trillion. He warned that failure to raise the limit would cause a default by the U.S.
He chooses to ignore the fact that if the limit were hit and it could not issue any more securities, the U.S Treasury would only default if it refused to request that the Fed honors all payments due, as explained here. Read the rest of this entry »
By: Andrea Terzi
Values transferred
The economic dimension of a social system is to be found in the activity of transferring valuable things and performing valuable actions. While the terms “exchange” or “trade” define a reciprocal action, it is best to consider, at a more general level, how value is transferred. In social systems, not all values being transferred entail reciprocal action. Read the rest of this entry »
U.S. Public Debt: What it is exactly – Who owes what and to whom – Why it matters.
In: Special Projects
This is a subject where there’s a lot of confusion, don’t you agree? This is why we are inviting students to send us questions, queries and concerns about the size of the U.S. public debt.
A group of students from Franklin College Switzerland sent us a bunch of questions, including the following set, which begins our discussion. More will follow. Read the rest of this entry »
Whenever the health of the U.S. economy is debated these days, one of the topics that consistently surfaces is the size of the U.S. public debt. As a special topic of exploration, we have chosen to offer a series of posts where we aim to clarify and answer questions, doubts, queries, and concerns regarding the U.S. public debt.
Here are some links on the issue, ranging from those that (irresponsibly) spread the debt fears and those that take care to explain the true nature of public debt. Read the rest of this entry »
By: Andrea Terzi
Economics is about giving and receiving
Within the social sciences, different disciplines overlap significantly with respect to their subject matter. Common themes in economics, such as money, production, consumption, or income distribution, fall within the realm of economics as much as they fall within other disciplines such as history, archeology, sociology, philosophy, or anthropology. Yet, each of these fields of knowledge looks at a specific dimension of the social world through its own glasses. The specific lens that economics looks through when studying the social world defines the economic dimension of social matters. Read the rest of this entry »
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