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I'm a little concerned that Economics as a formal branch of mathematics is totally ignored here in favor of the social science, which came after the mathematical models. I'm also not sure it makes sense to call "scarcity" the fundamental concept underlying economics; I might have chosen rationality, comparability of values, or efficiency. No mention at all of important concepts like Pareto optimality, revealed preference, marginal utility? I'm just a dabbler, but surely there's someone here with a better background in mathematical economics that could do a reasonable job fixing this? --LDC
Scarcity is in fact fundamental. If goods aren't scarce we can have all we want of them and so there is no need for economics. All the other terms-- like marginal utility, efficiency -- LDC mentions become important because we have scarcity.
Further, mathematics is just a tool albeit a a very important one -- not an end in itself -- in economics. First and foremost, Economics is a social sciense. Historically, economics as a social science came first and the use of mathematics was introduced gradually.
You are quite right - there is a mathematical side of economics (or as one of my professors would say hardcore econometrics). I could write up about 30-40 pages and subpages on the subject. It will take up some time though, and the real problem is to stick to the theoretical side and not to engage oneself into discussions about which view is right or wrong - we would clearly miss the point here. Anyway, you are the first person that has borught this up and I'm grateful for that. WP
Bad review of economics section
Someone wrote a bad review of economics section at kuro5hin:
Not if it's from September 2001, as it appears to be. The economics section here now bears simply no resemblance to what was here then. It's now really quite good, and contains a wide variety of topic coverage. The main page economics is not good enough, among other things it simply fails to explain scarcity well enough. Someone should dig around in the older versions to find a better explanation.
I put in a brief section on econometrics and added a little to the network effects section. Could add more, and may do so later. No guarantee it's totally precise and correct, but if I could do that off the top of my head, I'd probably be writing a textbook rather than updating Wiki b/c I felt like it ...
Some topics I think would be worthwhile (off the top of my head):
Game theory (linking to John Nash etc), pareto optimality, exchange rate theory (pegged, float, dirty-float), Bretton Woods, Neo-Keynesian school, Milton Friedman, the Austrian School, utility theory, revealed preference, cardinality and ordinality, simple supply and demand, oligopoloy / monopoly theory and competition, contestability, sunk costs, interest rates, money supply, the concept of a market, Walras and the concept of the auction, the business cycle, random walks, determinism and predictablity in economics (linking to chaos theory), financial markets, and theories of regulation and taxation.
Off the top of my head though - I might come back to do some of them if I've got the time. Haven't really thought about most of this stuff for a few years now ...
Yikes, I agree, those are all important. But let's get to neutral on the structure first. I think the Fundamentals and History section are better up front because they simply don't take sides or introduce 'capitalism vs. not' - actually they frame the idea of political economy almost perfectly, and show how animal (instinctual swaps) to hunter-gatherer to more complex trade build up... a very even beginning, but kind of out of place at the very very end - 24
That said, many people will come here wanting to do a crash course in Economics 101 and so political economy, fundamentals, foundations, etc., should be nothing but links up front for them... hard to know how to handle this.
On the other hand, some university-educated former peasant in Cambodia with 5000 words of English will come here wanting to know why "Economics" is destroying his village and country, and that market has less support from neutral sources.
I'd say, err heavily on the side of neutrality, since that improves articles and gives something that can't be provided elsewhere - a neutral point of view. Fundamentals would go first, mention the concerns of the non-capitalist schools, end with the concept of political economy, link off to capitalism, and then proceed to explain how that political economy's terms are applied in the present: the rest of the article. Is that fair enough?
My vote would be for keeping this article fairly short, and essentially just saying: here are all the articles we have on economics here in Wikipedia, with brief uncontroversial explanations. More controversial ideas, like, say, Marx vs Neoclassical, should go in the respective articles so that it is very clear who is saying what. Dated April 5, 2002 by User:Enchanter
if that's the approach, then ONLY the Fundamentals section and a laundry list of different theories of political economy would go here. Since good old capitalism is the most prevalent, we can lay out the way it defines the major branches of economics: macro, micro, resource. And the theories classical, neoclassical, Keynes, etc.. But really that's more or less what the article is now. I agree completely that this article must not *COMPARE* different economic models, as that is the role of political economy anyway. This is also exactly what is done in factors of production, capital, means of production. So these five files have managed to be very neutral, and avoided taking sides extremely carefully. Tough since neoclassical/libertarian, classical/conservative, Marxist/socialist, green/environmental schools *PRETEND* they are talking about different things... but clearly and obviously aren't on micro-level.
so, I think the whole controversy is about macro, and that we should say that it is only about macro. In micro you can see a clean classical -> Marxist or neoclassical -> green transition with only very minor quirks of difference between the four. In Macro, basically, everything is religion. Dated April 5, 2002 by User:24.150.61.63
If anything, I think the article could be slimmed down with, for example, some of the history stuff going in history of economic thought. Dated April 5, 2002 by User:Enchanter
There's only one paragraph of history here now, and yes it should link to history of economic thought. I agree the whole article needs editing, but I can't see any content that can be omitted and still leave the casual reader roughly understanding the scope of real economics.
how about this. Fundamentals takes you from the simple difference between animals (who don't trade except for some apes who engage in prostitution...!) and the earliest human societies which trade loosely and informally, e.g. in hunter gatherer bands. That distinction is important to understanding that economics is not somethign made up by economists, as many people now believe. That section would take you up to political economy and explain that the most dominant political econmy is this thing capitalism which may be itself part of evolution or it may be just one way to do things (we should NOT take a side on THIS!) among humans (since trade is "our thing" that makes us unique I would hope we have a choice about it - but maybe not).
then, the *MICRO* concepts are introduced loosely with links to the other articles: factors of production, capital, etc.. Actually the way the micro articles are laid out is very good now and I think it is possible to explain each and every macro theory laying out how it sees each micro "style of capital" or whatever. MACRO is a dog no matter what you do, the fields don't agree, they don't want to agree, and politics is all over - see green economists or anti-globalization movement for a good list of current debates.
what I think we can't do is just slough this off on the reader with a list of links... as if the subject is too hot to handle. It isn't, the Fundamentals and the Micro factors of production are seen the same by all schools, even the Marxists - they just resist the term "human capital". Dated April 5, 2002 by User:24.150.61.63
Nitpicks
Rewrite improves it significantly, one nitpick: there is not enough focus on the thing economics is actually about - the formation, administration and optimization of *markets*, e.g. commodity markets. Mostly a matter of language, but all these players and studies are clustered around things, and those things are markets.
Another minor nitpick is that the Fundamentals section used to nicely bridge between the idea that economics is about the human ability to choose and trade, whereas the exactly same allocation of resources in other animals is guided mostly by instinct and is studied in biology and ecology. In the old wording, that bridged neatly to the hunter-gatherer society stuff. In the new one, it's a bit harder to tell how anyone could believe that hunter-gatherer society can be irrelevant if animal behavior and ecology are relevant... where is the bridge? This whole matter may need a rewrite to make the extreme views clear - I presume Margulis' flat statement that economics is ecology for humans is one such extreme. Is there another extreme saying that economics is the pinnacle of human activity coming directly from god, contrary in all ways to our animal nature, or whatever? Seems to me I've seen quotes like that...
Replaced scarcity, not because it isn't in the textbooks, but because "choices under scarcity" is just a verbose defintition of "trade". I vote for clarity.
"capitalism" doesn't belong on front page, i agree. Dated April 8, 2002 by User:142.150.129.50
I think it does. The vast majority of the world's population is now living under a regime of neoclassical economic assumptions applied via various institutions under a political economy of capitalism. If you read those articles, and commodity markets and instructional capital, but especially factors of production you will see a subtext of assumptions that basically explain, to popular satisfaction, why capitalism is popular. We need to think more about the m:three billionth user here.
This is very very important, as 10000 indymedia authors will get here soon, and if we don't have solid material on these issues, they'll just tear up every article with polemic and create chaos. You might also wish to review anti-globalization movement and green economists to see the basic conflicts in poli sci that are driving this. of course, if you find any of that wildly out of line with your own thinking, by all means cite and correct, but please try to avoid the wholesale cut-outs that more ignorant people here are engaged in... personally I NEVER remove a line of any article written by anyone else, but work with it and try to work its point of view in citing where it comes from.
The most credible players on a values-neutral and state-neutral economics are in the UK, of course. Oliver Harding at the London Health Observatory which is engaged in measuring well-being in the UK for the Blair government's U.K. Social Exclusion Unit, seems to have drawn the hardest lines around social capital rather than letting it fuzz out like Paul Adler (the global guru on this) has. Also, Nigel Nicholson of the London Business School wrote an article called "how hardwired is human behavior" - highly recommended, hits on the "fundamentals" problems hard. I don't know how the London School of Economics has characterized the issues in moral purchasing or intellectual capital but it's obviously key to understanding how they see this "brand versus flag versus label" thing that confuses so many in America (where e.g. Coca-cola is all three at once ;-))
you will notice, from all those question marks, that no one here seems to know much about the real world. On the other hand, put double square brackets around the name of any character in any Ayn Rand novel and you'll find an abundance. There is a serious m:Systemic Bias of Wikipedia as it stands. - 24
-speculation: in twenty years, economics will be incorporated as a branch of general systems theory. (doesn't belong on front page either) Dated April 8, 2002 by User:142.150.129.50
it's a common speculation especially among Gaians and terrist and Terran types. However, the objections are serious: we don't actually understand ecology enough to make it a branch of general systems theory, nor necessarily should we, as general systems assumes a "God's eye view" of events that is increasingly suspect thanks to body philosophers. Second, economics, ecology and systems/physics theory (especially anti-reductionists) just doesn't deal with ethics well enough - most economic choice is ethical, see moral purchasing. Also, read the early Amartya Sen, especially "economics and ethics" and most importantly "is internal consistency of choice bizarre?" where he asks key body philosophy of action/body questions in context of economics. Sen is a heavyweight. He will do something quite new in the next 20 years. Let's not contradict it here:
Thus, my speculation is that economics, ecology, ethics, and physics will all combine into a new thing to *REPLACE* general systems theory. First there is that thing called "bionomics" which works for what biological stuff we can see, and then a more rigorous thing that works as a foundation ontology. But that does not belong on the front page either. All we're doing here is documenting the field as it is, trying to be even between classical, neoclassical, Marxist and green approaches. I'd say the UN backing for the idea of "natural capital" and the heavy influence of the greens makes them a first-class school (of green economists) even though they lack a clear political economy of their own (which your theory here would have to be).
welcome, and as you seem intelligent, I'd like your speculation on this - we have a problem brewing in commodity money over how to treat the gold standard. I suspect we just can't use the terms "commodity money", "fiat money" or "credit money" which are approximations disputed in the various theories, and should refer to the backing and clearing process directly, i.e. credit clearing, commodity clearing, and fiat clearing, describing how settlement occurs. That would assume that all three types of assurance could be involved in "backing", and that what really mattered for purposes of money was not "backing versus clearing versus tokens" but the clearing process as it relates to trust at the point of trade. If you agree, you might wish to rewrite commodity money and fiat money this way, looking at the diffs in the history and at the talk to see what disputes have been arising there and in military fiat. It won't take you long to see what the problem is - a bunch of folks who seem to believe history started with 1776 (Smith, USA) and no experience of the post-classical schools are citing off old textbooks with non-neutral definitions. This is fine in micro-economics, there's no difference in how the theories treat factors of production or means of production ultimately, but for macro, it's obviously a complete disaster, and I'm too busy with other stuff to fix the damage they seem to be doing.
So, you're welcome to wade in. To see the issue clearly, read this gold standard = fiat in disguise which is an anti-fiat rant: "as long as you price your gold in fiat dollars and not in silver, or you price your silver in fiat dollars and not in gold, you are a part of the problem." As you know, the vast majority of the cranks believe this, and they're about to get here in the dozens at least. So we have to pre-answer this type of question, and avoid ideological bias of claiming that money is "all credit" or "all commodity" or "all fiat" - thus the clearing or backing terminology is essential. -24
ALL of the above could use more citation and qualification, as it is very hard to write a totally neutral text that doesn't take sides on issues of state or values. And whose terms the classical, neoclassical, Marxist and green gurus would at least all recognize and not hack up. Which must be our objective, if we wish wiki to have the most citable and most trusted text on the subject anywhere in the world.
And if that's not what we want, why the hell are we here?
---
Anyway if you truly don't give a shit, thanks for your input so far. ;-) - 24
I'm a little concerned that Economics as a formal branch of mathematics is totally ignored here in favor of the social science, which came after the mathematical models. I'm also not sure it makes sense to call "scarcity" the fundamental concept underlying economics; I might have chosen rationality, comparability of values, or efficiency. No mention at all of important concepts like Pareto optimality, revealed preference, marginal utility? I'm just a dabbler, but surely there's someone here with a better background in mathematical economics that could do a reasonable job fixing this? --LDC
Scarcity is in fact fundamental. If goods aren't scarce we can have all we want of them and so there is no need for economics. All the other terms-- like marginal utility, efficiency -- LDC mentions become important because we have scarcity.
Further, mathematics is just a tool albeit a a very important one -- not an end in itself -- in economics. First and foremost, Economics is a social sciense. Historically, economics as a social science came first and the use of mathematics was introduced gradually.
Why not the allocation of resources, period? Whether they're 'scarce' or not isn't really relevant and too often a matter of opinion. There are plenty of doctors in the US, for example, but their distribution is hardly optimal. It's economic, however.
Because the allocation of non-scarce resources is generally rather trival. If the resource is non-scarce give everyone who wants it as much as they want. In situations where it is interesting like patents and copyright, the time required to create them is scarce. As an amateur economist, I would define scarcity as something that has an opportunity cost so in that economic sense doctors are scarce since there is something else that would be useful for them to do (say like be a doctor in a different county). Jrincayc 03:49, 29 Jul 2003 (UTC)
First sentence
The first sentence has no verb: "Economics (formally known as political economy) the governance of the production, distribution and consumption of wealth and the various related problems of scarcity, finance, debt, taxation, labor, law, inequity, poverty, pollution, war, etc. " ...I am going to insert the word studies for now. Feel free to fix it differently. Kingturtle 04:54, 19 Aug 2003 (UTC)
Bad review of economics section
Someone wrote a bad review of economics section at kuro5hin:
This comment could help the section to improve?
joao
Not if it's from September 2001, as it appears to be. The economics section here now bears simply no resemblance to what was here then. It's now really quite good, and contains a wide variety of topic coverage. The main page economics is not good enough, among other things it simply fails to explain scarcity well enough. Someone should dig around in the older versions to find a better explanation.
"Economists are sometimes referred to as Methodological Individualists."
Hmmm... It sounds like you're saying that the two terms are synonyms, which is certainly not the case. Are you saying that all economists are MIs? Or that some people say that all economists are MIs? From the 5 minutes of Googling on the subject, I don't see why economists should necessarily be MIs. Axlrosen 23:54, 20 Nov 2003 (UTC)
I agree that it doesn't make sense. Striking: Economists are sometimes referred to as Methodological Individualists. from the page. The link to Homo economicus fills the role that I think they are trying to get much better. Jrincayc 03:36, 21 Nov 2003 (UTC)
The article as it stands in December 2003 is now balanced by "framing economics", an introduction that lays out the reasons why economic models do not fully explain human behavior (failing to deal with ethics, ecology and energy economics, how labour and welfare are actually produced, etc.) This could be abbreviated and some of it moved as criticism to Homo economicus. However, these qualifying statements need to be made, and stronger qualifying statements can be found at http://natcap.org - somewhere in there you can find a list of "the 15 bad assumptions made by economics itself."
The question of political economy as questioning the assumptions versus economics as putting them into models is also dealt with in that section.
Law and economics should also be mentioned as a way to apply economic models to law. It may be that these methods do not describe choice in the real world at all, but only in artifical/industrial/legal worlds created by humanity.
These parts of the article remain in the minds of those who, while prepared to comment that they are missing, are unprepared to add them to the article. You could do us all a favour by adding them yourself. Cheers -- Derek Ross dated December 11, 2003.
Actually, I believe this anonymous IP is banned user EofT. If so, he could do us all a favour by trying to getting Jimbo's permission to edit, instead of trying to poke holes in our soft security. It's soft, but it ain't weak. -- Cyan 20:36, 11 Dec 2003 (UTC)
What you believe is what you believe, for your own reasons and in advance of your own agenda, which apparently includes censoring economic material that is of grave interest to everyone dying for poor economic organization on this planet at present.
There will be no begging for "permission", certainly not for conveying essential information like this. The GFDL terms are not being followed, so, there is no obligation to "respect" any "rules" made by sysops. There is also no "trying", what matters is mostly getting through, and will continue to get through. Using 142.*.*.* IPs bald-faced like this is mostly to wake up people like you to the kind of garbage (liars, libellers, spin doctors) you have allied yourself with - look into the actual origins of this idiocy, what was actually said to User:RK and User:Maveric149, and you will realize you are on the wrong side, Cyan, and that User:Netesq, User:Cunctator, etc., are right to call for vast and deep changes to this "mailing list" system.
There is very great controversy about how supply and demand questions, ethics questions, and ecology interact to restrict and frame economic questions. These questions are usually dealt with in the field called political economy.
The article on economic choice deals with what constitutes an economic, rather than a moral, political, or personal type of choice.
I agree sorta with the premis, and there has been a controversy over applying economics to various decisions. On the other hand this is not balanced as written, and I am not sure what a supply and demand question is. I personally think that controversy over economics should not go as part of the initial summary, but should instead go into a seperate section on the page if such is considered necessary. Jrincayc 21:57, 14 Dec 2003 (UTC)
I'd like to stress that there is substational information about alternative and in many cases obscure approaches to economics on Wikipedia. In fact, the alternatives are overall given more attention than mainstream economics in a variety of articles. The problem with the article on economics has always been that it has tended to be dominated by people who dislike the subject. I'm fine with criticism of economics, but the subject should first be given a clean, uninterrupted presentation, just like all the alternatives (green economics, natural capitalism and what have you). -- User:Galizia dated December 14, 2003
This is just not true. If anything the material overall is still balanced towards the so-called "mainstream" neoclassical view, which is by no means accepted in most forums outside the US. If what you say were true, there would be articles on the vast fields of labour economics and welfare economics which have been leading even to Swedish Bank Prizes lately (Amartya Sen the most obvious example). There'd be attention paid to labour theory of value and labor theory of value being about the same thing, and, there'd be discussion of David Ricardo as having founded that theory, not just a firm politicized dismissal.
It is not just dislike that drives most criticism, it's a basic belief that economics is false - there is no such thing as a commodity and no such thing as a product and no such thing as supply and no such thing as demand - that the quantifications applied in the contracts on commodity markets etc., are simply based on nothing, utterly ungrounded in anything but the authority that writes and enforces them. There have been street protests by economics students in Europe on this grounds.
There are no more "alternatives", if you look at the discourse taking place at the UN and even at the World Bank, it is a question of deciding which of the ecology-driven approaches is the "mainstream"... the term natural capital for instance is now in wide use at both institutions. No one believes, for instance, that GDP has any valid economic basis whatsoever. There is NO argument for that - its creators argue that it is not relevant for the purposes politicians and bankers use it for.
Marxist economists, who were more influential a few decades ago, often feel that each era of history obeys its very own set of laws, and that contemporary economics can only be applied to industrialized societies.
was replaced with:
Marxist economic theory asserts that each historical era has a unique "dialectical" tension, and that economic formulations can only be applied to societies which have the same "objective" means of production.
The first actually makes sense to me. Is there any advantage to the second? It looks like it might be more precise, but it doesn't make much sense to me. Jrincayc 14:24, 11 Jan 2004 (UTC)
The new description is harder to understand. It requires that the reader know what dialectic and objective mean as used by Marx/Hegel. It also illiminates the comment about the declining influence of Marxist economics since the fall of communist USSR. mydogategodshat 00:44, 12 Jan 2004 (UTC)
Reverted back to original wording. I would probably would like the change better if it included a link on objective and dialectical to the definition that Marx/Hegel have. Jrincayc 02:15, 13 Jan 2004 (UTC)
The original wording is both weaker and less precise. First Marxists don't "feel", their theory states clearly. Second, the original wording does not say why Marxist economics says as it does. Yes the terms are used in the particular marxist sense, which is why their are quotes aroud them.
Can you write it in such a way that the reader can understand it without knowledge of specialized Marxist/Hegelian terminology? mydogategodshat 02:15, 14 Jan 2004 (UTC)
No more than one can explain Smith without explaining supply and demand in context. Some words are primary. For marx, dialectical struggle over the means of production is, almost, as close to an axiom as one will get. Perhaps you could find someone more sympathetic to marxism than I am to find a simple way of explaining the theory. Absent this we should, at least, let Marx speak for himself.
This quote from the Marxism page says very much the same thing as my earlier revision:
"In the social production of their existence, men inevitably enter into definite relations, which are independent of their will, namely relations of production appropriate to a given stage in the development of their material forces of production. The totality of these relations of production constitutes the economic structure of society, the real foundation, on which arises a legal and political superstructure and to which correspond definite forms of social consciousness. The mode of production of material life conditions the general process of social, political and intellectual life. It is not the consciousness of men that determines their existence, but their social existence that determines their consciousness. "
All I've done is paraphrase this rather famous 'graf.
One word I have been banishing from economics pages is "modern". It's kind of ridiculous, in most countries you have a Marxist, Keynesian, monetarist and perhaps other analyses battling it out in the political sphere. Considering that economics is a SOCIAL science and not a real science, it seems to me the idea that say Milton Friedman's ideas are "modern" and Keynes (and his followers like Paul Krugman) and Marx (and his followers like the Monthly Review) are old-hat, classical, outdated and so forth seems to be slightly POV. Post-Galileo, most people will agree to a consensus on real sciences like astronomy, but a social science like economics will always be fraught with different camps as long as economic classes exist, and implying that economics is more like a science (once they dropped the word political from political economy and added the -ics), and that the ideas of Milton Friedman financed by the idle classes are "modern", and that Keynesian or Marxian ideas supported by many workers are outdated in some manner doesn't seem to fit. -- Lancemurdoch 04:19, 15 Jan 2004 (UTC)
There is a clear dividing line between economics in the 19th century, which based its practice in description, and the modern view which takes economics to be mathematically based - which is not to say scientific or not. This difference is primary, and not based on monetarism versus Keynesian theory. The basis of economics as the choice between scarce outcomes is something which no school of market economics seriously disputes. Now what, exactly, is scarce, and what the fundamental scarcities are, is open to enormous dispute, but "a form" is both vague and does not correctly capture that the overwhelming consensus among practicing economists is for the definition offered, which, literally, heads just about every text book on economics currently published.
This differs strongly from the 19th century defintions of political economy, which treated the subject as based in description of human activity - even if the ultimate subject of choices between mutually exclusive outcomes was the central question of the work.
I am all in favor of not piling on wasted adjectives which only serve to advance one particular view over others, but here, the word modern is used in its absolutely proper sense as the current tradition and theory of a discipline, and not being attached to a particular school, though I did note in the definition that it was modern market economics - that is all schools of economics centered on the operation of markets.
changing it back, there was no NPOV violation here.
Marxist economic theory asserts that each historical era has a unique "dialectical" tension that is determined by that society's "relations of production" (who owns what, who does what, and who receives what), relations that constitutes that societies economic structure. Analysis of any economic system must, according to Marx, be done within the framework of its relations of production, and the dialectical tension that this creates. mydogategodshat 06:16, 15 Jan 2004 (UTC)
I'm probably more familiar with Marx than the average person here and I have no idea of what dialectic means (Noam Chomsky says he has no idea what that word means as well, not for lack of trying to find out).
On the other hand I totally agree about the relations of production. To those not steeped in Marxian economics: the idea is that a commodity undergoes three phases - production, exchange and consumption. That people like Milton Friedman are focused on exchange, and to a lesser extent consumption, and to a large extent ignore production, is seen as ideological. The classical economists like Smith and Ricardo considered these now sort of verboten topics, as did Marx, in depth, but in the 21st century, among the economists employed by people who can afford to employ economists, "the laws which regulate the distribution of the produce of the earth" as Ricardo put it, hold little interest, and focus is on exchange (trade) and price, and to a lesser extent use and consumption.
Really, the problem is that in a Marxian, or perhaps even Ricardian sense, the feeling is that the focus is too narrow, and especially virtually ignores production.
As far as mathematics, well I can think of no better way to ignore a social relationship in a social science than mathematics. Marx saw economic systems of different eras like slavery, feudalism, capitalism. One could calculate how much cottons slaves picked, how much a slave cost to capture, ship, feed, breed. How much the slave cost at an auction, how many square meters of cotton a slave picked a day, what the price of cotton was, how it was traded to Britain which helped in its industrial revolution in textiles, how Eli Whitney's cotton gin increased slave productivity and the master's profits and so forth if one look over the account books of an American slavemaster's accountants books of 140 years ago. But all of that economic data, in the social science of political economy, would not explain some important relations of production. In fact, Haiti's slaves rose up and killed off their masters not long after the American revolution, which changed the economic system being studied.
I am not obsessed with adjectives, I, and many others, just don't like how this social science is portrayed as more like physics than literary theory, how theories favoring the rich are called "modern" while ones favoring workers are "old, outdated" and whatnot, and how the field of economics has been narrowed significantly since even bougeois liberals like Adam Smith began studying political economy. In my mind, narrowing economics to a narrow mathematical study of price at the point of exchange is inherently ideological. -- Lancemurdoch 09:45, 16 Jan 2004 (UTC)
This is some very good and productive discussion, and I'd like to first thank everyone for taking the time to elucidate where they are going.
I think the first of Lance's concerns - on "social science" itself - is best dealt with on that page. I've started a rather longish essay on the history of the modern concept, and welcome expansions and additions, particularly in areas involving the still controversial role of the idea. Economics isn't the place to fight this particular battle except by reference.
Dialectic - dialectic is actually a simple concept in Marx. There is the means of production, there is the ability to control the relationships that make up those means of production. Consciousness is the ability to create the relationships that run production. So if you can take a group of people, drop them someplace, and they can, for example, start a factory, then they have sufficient "consciousness" to run a factory. If a society has sufficient consciousness to run the production it is based on, then it possesses the "objective" means of producition. Basically, there is being able to do something, and there is the ability to organize it.
Dialect then is the process by which classes come to consciousness of production, and the struggle to control production once they do. The dominant class at an given time can be defined as the class "the people who know what the fuck they are doing". Against them are struggling people who actually are doing it, but don't know how to do it themselves.
To Marx then, history is a series of struggles, in each case the dominant class is overthrown by a new class that figures out how to produce and then says "what do we need these bums for?"
We then get into his analysis of profit and why surplus value is distributed more widely etc etc etc. But Dialectic is not, itself, problematic as a concept.
Production and Consumption I think Lance has hit on a core problem here: most critiques of current practice, both within and outside the field, center on what economics calls "value", which is another way of saying "underlying realities of production" and over "decision" which is another way of saying underlying psychology of consumption. Perhaps we can organize material which allows a general summary of these critiques - giving broad reference to all of the major work being done, that we know of - that centers around these and finding a place to put them. Again, economics doesn't seem to be the place, and instead, these questions seem to be about framing economics - where it fits in the general scheme of knowledge. Political Economy is the subject where more of this fits, since production issues are crucial to policy.
Once again, thank you for taking the time to work through this, I am very confident we can produce a final article which hits the mark and broadens, rather than narrows, the focus. For myself I am going to concentrate on economic modelling and the mathematics, simply because it is something everyone ought to know, and wiki is rather short on good explanations. People need to know what it is economics is "really" about, in terms of what it does, before they can start sorting the real critiques from the rants of cranks.
Especially because there are enough cranks on the internet to deal with.
I agree that the fundamental assumptions of economics are very important to include in our articles. It is always difficult to know where to put content as broad and as fundamental as value theory. There is an interesting article at Anthropological theories of value which still need some work, and there is a section of the Wealth article Wealth#The Anthropological view of Wealth that goes into these issues somewhat. There is also Economic anthropology which is a mere stub (and not a very good one).
Looked at it, it is basically what I call a "But But But!" page, which references a critique of the mainstream view without exploring it, and provides a link to some yet more minority position. To integrate it means really giving a good exigesis of the views of anthropology with respect to wealth - which go a lot farther than an anthropological critique of economics - and finding places to link with economics, sociology etc. etc. More work - fun fun fun. I'm going to focus on doing a section on the basic math of mainstream economics (supply and demand curves!) and continuing with the political economy section creating links into as many other disciplines as possible so that people will be able to get a sense of how all of this holds together. But back to that evil original research stuff for the time being. Stirling Newberry 19:11, 17 Jan 2004 (UTC)
As for dialectic, this is a term Marx borrowed from Hegel. He took Hegel's system of historical change (thesis, antisythesis, and synthesis, ultimately culminating in the Ideal) and applied it to the means of production. mydogategodshat 16:25, 17 Jan 2004 (UTC)
And Hegel borrowed from Aristotle. Marx' use of the term, while it is in the Hegelian tradtion is different in key ways. For Hegel the dialectic was an expression of metaphysical reality. For Marx, it is rooted in the struggle over the objective means of production. hence "Materialist Dialectic".
Yes, from Aristotle he borrowed the notion of a teleological flow of history. mydogategodshat 16:25, 17 Jan 2004 (UTC)
By the way,the concept of "a final article" is one that we all learn to abandon here at Wikipedia. No sooner than you get an article just the way you want it, and someone will make changes to it. Colaborative authorship is an amazing process to see in action: It can be maddening too. mydogategodshat 02:07, 17 Jan 2004 (UTC)
As for final, on a subject like Economics - probably not. But getting to an island of stabilty would be nice, so that we can drill down deeper into the sub areas of economics - many of which are stubs or paraphrases of the definition. Marx is, of course, going to be problematic, especially since there is on overwhelming USA bias to contributors, and Marx is viewed differently in Europe than in the US. There he is more or less a classical labor theory of value economist who studies production. Here he's a satan against what is held dear. Hence there are always going to be "corrections" which represent the, well, libertarian leaning, consensus of internet Americans.
What I hope we can avoid is crude slapshots, these always come across badly, and don't present the case for a particular POV well, which is what NPOV writing should be aiming for: give everyone their best case, and let original research and the reader sort it out.
Another thing is that I think as far as mainstream or whatever to ask who is paying the bills. For example, Stephen Roach is a Morgan Stanley economist studying the "relationship between ends and scarce means which have alternative uses". Now imagine he did analysis and said one day to his boss "I think the drive for profit is creating inefficiency in matching scarce resources to their uses of highest utility, my analsis shows eliminating shareholders, prodit, dividends, rent, and interest, and handing over the companies, offices and factories to the people who work in them will have a better result". What would happen? He would be fired. Economists employed by the AFL-CIO come to different conclusions than ones employed by the US Chamber of Commerce, and the fact that the Chamber of Commerce can afford to employ more economists to forward their ideas doesn't make what they're saying any more true. -- Lancemurdoch 09:45, 16 Jan 2004 (UTC)
Roach has in fact said that. Econospeak is "market inefficiency due to insufficiently transparent flow of information" - id est fraud - and "market misallocation of resources due to temporary price anomolies" - id est "people were stupid enough to buy CMGi at 104, so who am I not to sell it to them?" and "distributed costs of capital accumulation" - id est "having a lot of poor people so that we can have more billionaires has got to lead to something bad at some point." - and "low probability high consequence events" - id est "we know that catastrophe is going to strike sometime, we can't price it, so the best thing to do is hope you are out of the market before it happens." A good deal of solid work has been done which points to why smooth statistical models don't see these rather obvious real world consequences, and ways of looking at them, mathematically, are coming into being see complexity etc.
While this isn't, yet, a consensus viewpoint, looking at the recent list of Nobel prize winners would suggest that the discipline is piling up counterexamples to the neo-classical consensus and we should document that. For the rest, that is under the heading of "original research" - which is where I need to be getting back to at the moment.
Thanks again, this has been very productive, and I hope this core can hack out the issues we have and produce some high quality work.
I think that can be understood without having previous knowledge of Marxist thought. Maybe someone not familiar with Marxist economics can tell us if this is clear to them. mydogategodshat 07:06, 15 Jan 2004 (UTC)
We really need an equation editor. This subject needs to have at least the simple equations laid out.
Some topics I think would be worthwhile (off the top of my head):
Off the top of my head though - I might come back to do some of them if I've got the time. Haven't really thought about most of this stuff for a few years now ...
C
Replaced scarcity, not because it isn't in the textbooks, but because "choices under scarcity" is just a verbose defintition of "trade". I vote for clarity.
I think the point of economics is to create those verbose definitions. It's not just "choice under scarcity" but also the NATURE of choice, the NATURE of scarcity. The Fundamentals section is good but has to make this clearer, and come up front.
The first sentence has no verb: "Economics (formally known as political economy) the governance of the production, distribution and consumption of wealth and the various related problems of scarcity, finance, debt, taxation, labor, law, inequity, poverty, pollution, war, etc. " ...I am going to insert the word studies for now. Feel free to fix it differently. Kingturtle 04:54, 19 Aug 2003 (UTC)
A problem with this definition is that it is simply wrong to say that what passes for economics today includes all the studies formerly (and now in parallel) known as political economy. While there is consensus on one concept of technical economics and its methods, and on capital types, the latter has yet to be completely integrated into monetary policy, fiscal policy, accounting and such - thus there are well-defined packages of accounting reform and monetary reform that seem to have no valid reasons NOT to happen, other than the fact that someone benefits from the inertia and failure to do so. In the 20th century this exact situation led to two very nasty wars, and a third nasty confrontation over economic systems, that between them, have characterized the whole global polity and most moves towards world government. Accordingly, we are obligated to present economics in its full depth, and with its full impact on human society, and the present page simply does not do that adequately.
Hell, we're talking about distribution potentially of air, water, and food here. Hard to get more important than that.
Controversy over Economics
Removed:
There is very great controversy about how supply and demand questions, ethics questions, and ecology interact to restrict and frame economic questions. These questions are usually dealt with in the field called political economy.
The article on economic choice deals with what constitutes an economic, rather than a moral, political, or personal type of choice.
I agree sorta with the premis, and there has been a controversy over applying economics to various decisions. On the other hand this is not balanced as written, and I am not sure what a supply and demand question is. I personally think that controversy over economics should not go as part of the initial summary, but should instead go into a seperate section on the page if such is considered necessary. Jrincayc 21:57, 14 Dec 2003 (UTC)
I'd like to stress that there is substational information about alternative and in many cases obscure approaches to economics on Wikipedia. In fact, the alternatives are overall given more attention than mainstream economics in a variety of articles. The problem with the article on economics has always been that it has tended to be dominated by people who dislike the subject. I'm fine with criticism of economics, but the subject should first be given a clean, uninterrupted presentation, just like all the alternatives (green economics, natural capitalism and what have you). -- Galizia
While there is an admirable set of articles on a lot of important questions like value of Earth (one way to assess economics is whether it values the things that humans actually value), the idea that this is somehow "given mroe attention" is just not true. The few such topics covered are absolutely basic, and even essentials like ecological yield were only covered recently.
If anything the material overall is still balanced towards the neoclassical view you wrongly call "mainstream", which is by no means accepted or acceptable in pure form in most forums outside the US. In the UK all economists must learn Marxist economics and the Marxist critique of capitalism. Joseph Alois Schumpeter is covered, etc..
But test what you say another way: If what you say were true, there would be articles on the vast fields of labour economics and welfare economics which have been leading even to Swedish Bank Prizes lately (Amartya Sen the most obvious example). There'd be attention paid to labour theory of value and labor theory of value being about the same thing, and, there'd be discussion of David Ricardo as having founded that theory, not just a firm politicized dismissal. These errors aren't corrected, so if anything that shows systematic bias against the less quantitative and technical economics.
Everyone dislikes scarcity. But it is not just dislike that drives most criticism, it's a basic belief that economics assesses scarcity falsely and thus its basic constructs are irrelevant - there is no such thing as a commodity and no such thing as a product and no such thing as supply and no such thing as demand.
Of course there is not any such thing. There is also no such thing as a person, no such thing as a light bulb, no such thing as a tree. But we have words for them because we find the concepts useful. Supply is a useful concept, demand is a useful concept, and concept of supply and the concept of demand exists (maybe not in your mind, but certainly in mine). Unless you are interested only in the philosophical concept of nihlism, stateing that they don't exist is not productive. All models are false, and we precieve the world by making models of it, so you can take the extreme view that everything that we precieve is false. Many of the models of economics are useful, as in they are true enough that they can be used some of the time. You just have to understand that what you have is a model, and then decide, is this the right model? Supply and demand is a fairly good model for wheat but a lossy model for love. Most of the ideas that have been thought of for economics in the past hundred years have been to figure out where the failings of economics is and then incorporate that into a new model. Explain exactly where the models of economics fails and you may have something useful, claiming that they fail in general is completly true and completely useless. Jrincayc 16:24, 17 Dec 2003 (UTC)
You only believe in these things if you are taught to take a God's eye view of them. The "alternative" position is that quantifications applied in the contracts on commodity markets etc., are simply based on nothing, utterly ungrounded in anything but the authority that writes and enforces them. What is a "soybean" when there are breeding, genetic manipulation, pesticide use, and other comprehensive outcome differences that really and truly matter even to the consumer but aren't reflected in the numbers? There have been street protests by economics students in Europe on this grounds - that what they are taught is pure nonsense. No one believes, for instance, that GDP has any valid economic basis whatsoever. There is NO argument for that - its creators argue that it is not relevant for the purposes politicians and bankers use it for.
Yes, GDP has some severe problems. For example, I take care of my kid, no contribution to GDP. I pay some body else to take care of my kid, contribution to GDP, even if they do a worse job. Similarly, I have to buy a lock for my door, contribution to GDP. I can leave my door unlocked and don't need to buy a lock, no contribution to GDP. I am open to suggestions for a better measure. Maybe next time you come, you could work on writing well researched NPOV articles about Genuine Progress Indicator or Index of Sustainable Economic Welfare that do try to be more accurate measures. Jrincayc 16:35, 17 Dec 2003 (UTC)
There are no more "alternatives", if you look at the discourse taking place at the UN and even at the World Bank, it is a question of deciding which of the ecology-driven approaches is the "mainstream"... the term natural capital for instance is now in wide use at both institutions.
Also, look at the lack of detailed articles on subjects such as those linked from market system - there is no detailed discussion of how an energy market differs from a debt market for instance, or even what collateral is. So the neoclassical assumptions that all contracts for all services are equally commodifiable, and that perfect competition assumptions can apply to imperfect/real situations of unequally distributed power, are both being baldly accepted. Else "we" would surely "need", and "have", articles on these detailed differences.
As it is such considerations are ghetto-ized in separate articles on energy economics that don't have the detail on how the energy trading mechanics of the real world actually work. This doesn't mean that energy economics is "alternative", it means that the impact of energy on the rest of economics has been censored/ignored. It means that energy has been treated as if it were no different than any other "commodity' - but of course "we" don't seen to be starting any foreign wars for control of oh say soybeans... nor putting trillion dollar budgets together for military devices that burn solar power... These issues dominate the political economy today, so it's pretty clear that economics articles that pretend these things are just part of some "free market" where people are making voluntary choices, is idiotic at worst, and ideological at best. User:EntmootsOfTrolls
EntmootsOfTrolls, I think that you could make some valuable contributions. Unfortunately, your behaviour overshadows your contributions. For example, the comments about economics are helpful to me to see where you are coming from (even if I disagree with quite a few of them). On the other hand (I'm an economist, so I have to say this), your removeal of the comment from Cyan and your combative strategy don't help things. I will gladly post any well researched, NPOV, GFDL articles that you email me that are appropriate material for an encyclopedia and will attribute them to you (I would love to see a good article on the World3 model (from Limits to Growth) and good articles on alternative measures to GDP and the problems with GDP). Since you claim that your banning was unfair, I am also willing to read your reason why you believe this. Good Day. Jrincayc 16:57, 17 Dec 2003 (UTC)
Dealing with the impact of energy on economics is certainly worth treatment, but then, this is an area where I have some degree of expertise. Wiki's not paper, we can cover the emerging ideas in xaos theory and scarcity which a more staid publication could not. I'd like to open a discussion on how to do this, without distracting from the presentation of the status quo, which, after all, is what people go to an encyclopedia for.
I would be very interested in an article on chaos theory in economics if you can write one. The only thing to beware of is you can't get too close to the edge. If you do someone will delete the page claiming that it is primary research. They believe we should restrict our articles to well established knowledge. mydogategodshat 02:28, 16 Jan 2004 (UTC)
I think we could at least write a stub which points to its existence, references some of the work being done, and go from there. For reference, I am currently at work on a book entitled The Fourth Republic which argues that there is a visible relationship between the basis of monetary exchange systems and constitutional law in the US, and it makes use of a certain amount of both xaos theory and political economy versus economic theory. A careful and reasonable presentation of the conflicts within economics, as well as a solid presentation of economic thinking itself, is, I believe, useful, because if done properly, it will give people an idea not merely of what is, but the directions that are being pointed to for the future. Stirling Newberry 18:28, 16 Jan 2004 (UTC)
The following material removed from the article
Economic Theory As A Degenerate Science
Steve Keen a senior lecturer in economics in the University of Western Sydney claims in his book "debunking economics" that current mainstream economic theory is a degenerate science closer to the field of astrology than the field of astronomy.
Keen argues that the very mathematical foundation of economics is flawed. While the theory of supply and demand is correct, the mathematics is used incorrectly in the basic foundation of economics.
In particular, the supply and demand graphs shows two straight lines intersecting each other. The point where the straight upward slooping supply line intersect the downward slooping demand line is where the economic exchange is suppose to take place.
The problem as immediately spotted by physicists, mathematicians and engineers is that in real life, lines representing natural phenomena is never a straight line but curves.
Keen says, the market demand curve can’t be smooth – at best it’s jagged, going up and down with price – while the supply "curve" is at best a horizontal line which probably slopes down rather than up.
(This guy Keen is a quack. He is claiming that firms will want to produce more product when price (and profits) goes down and they will want to produce less when selling price (and profits) goes up! He also claims the demand curve rises in places. For this to happen the income effect would have to be greater than the substitution effect and there is very little empirical evidence to support this (see here for an explanation). What actually happens is that the demand curve falls at varying rates (see here). mydogategodshat 11:25, 3 Feb 2004 (UTC) )
If the supply and demand graphs are calculated properly with actual curved supply and demand lines, then an amazing solution may occur. The supply curve may intersect the demand curve at multiple points. That is to say that there may be multiple solutions or points of stability (known as attractors).
Conscious that he might be dismissed as a ranting marginalised lunatic, Keen says his arguments are not based on ideologies, but on mathematics.
Keen says, most introductory economics textbooks present a sanitised, uncritical rendition of conventional economic theory, and the courses in which these textbooks are used do little to counter this mendacious presentation. Students might learn that "externalities" reduce the efficiency of the market mechanism but they will not learn that the "proof" that markets are efficient is itself flawed.
The minority which continues on to further academic training is taught the complicated techniques of economic analysis, with little to no discussions of whether these techniques are actually intellectually valid. The enormous critical literature is simply left out of advanced courses while glaring logical shortcomings are glossed over with specious assumptions. However, most students accept these assumptions because their training leaves them both insufficiently literate and insufficiently numerate.
Equilibrium, he says, has become a religion – anything which is non market is not as good as anything which is market, therefore every move we make towards market will make us better, so it’s an ideology not a reality.
The reality is that the market doesn’t work in equilibrium and that’s the thing that economists can’t comprehend. They are stuck in a 19th century mathematical world, where everything works in equilibrium and they can’t cope with anything other than that.
The main problem I have with this material is that it is not a critique of economics. It is a critque of the simplifing assumptions used in first year economics to make difficult concepts easier for new students to understand. It is true that in first year economics curves are linear, there is no mention of multiple equilibria, all supply curves slope upwards to the right, and there are many assumptions made that are not critically assessed. But when you go beyond first year, these simplifying assumptions are relaxed. Demand curves have price points. It is possible to have a downward sloping to the right supply curve, but only in very resticted situations (only industry supply curves, not individual; only in the long run, not in the short run; and only when the long run average cost curve is decining over all relevent output levels). There are instances of multiple equilibria (labour markets and foriegn trade markets).
This article needs a "Criticisms" section, but this is not it.
mydogategodshat 21:22, 3 Feb 2004 (UTC)
The one valuable point made by this contributor is that economist generally do not adequately assess the fundamental assumptions upon which models are built. mydogategodshat 21:34, 3 Feb 2004 (UTC)
Thank you, Mydogate, for putting this in talk. Wikipedia managed to become very slow for me right before I had to leave for work. I think Steve Keen has some points, but I think he is exaggerating when he states that economics as a whole is degenerate. I don't think that the critque should go on the front economics section, but I think either an article on Steve Keen, or on problems with typical economic assumptions would be fine to create as a separate article. Jrincayc 03:06, 4 Feb 2004 (UTC)
Agreed, I would like to see both a short "criticisms" section in this article and also full length articles on the topics. My problem is not with the topics but with the content. I am not familiar with Keens work, but I doubt if this material is an accurate representation of it. Maybe someone that is familiar with Keens could paste this material to a new article and fix it.mydogategodshat 04:12, 4 Feb 2004 (UTC)
Added "Critics" to the "Also See" section. Added Steve_Keen as a link to a separate wiki page. - drnobody
Thanks for the link to Keen's web site. I checked out some of his articles. I particularly liked the way he critiqued infiniticimal output here [1]. I think I will read some of his stuff in detail when I have the time. mydogategodshat 23:36, 4 Feb 2004 (UTC)
---
Quotes from above:
"Replaced scarcity, not because it isn't in the textbooks, but because "choices under scarcity" is just a verbose defintition of "trade". I vote for clarity. "
"I think the point of economics is to create those verbose definitions. It's not just "choice under scarcity" but also the NATURE of choice, the NATURE of scarcity. The Fundamentals section is good but has to make this clearer, and come up front. "
Quote 1 is incorrect, choice has little to do with trade and everything to do with scarcity. Choice occurs directly because of scarcity, since if I had everything i wanted (no scarcity) then I would no longer need to *choose* between alternatives. To go further, choice is usually considered a 1 person exercise while trade is at least 2, or more.
I glaced over the article and I see that a lot of stuff in political economy isn't included in here and could, and should, be moved over. --ShaunMacPherson 13:00, 6 Feb 2004 (UTC)
---
A quote:
"Economics explicitly does not deal with free abundant inputs -"
I am not sure if this sentence is correct, but at the very least the term 'abundant' is incorrect. The opposite of scarce (finite) is not 'abundant' but closer to limitless / infinite.
As for free, economics looks at free inputs all the time, sun, air are usually considered 'free' for the taking. As well as pure public goods are necessarily 'free goods', usually paid for by tax however, because no market can exist for a pure public good (i.e. national defense).
[edit]Economics is a social science that studies human resource making activity. Humans make resources to support their life. Human life on this Earth needs supply. The three basic supply, food, clothing and housing then a wide variety other goods, products and services. The supply, these resources is made in the economy of a society. Economics studies how the economy works. How the products, goods and serives are made, traded and distributed.
Maybe this was written by a non-english writer, but I have to challenge some of the terminology. Generally in economics, resources are things that are used rather than made. Also to say that economics studies how things are made is misleading. The study of how things are made is industrial engineering. Economics studies how things are made only in the very restricted sense of how scarce resources are allocated in a production process. I do however agree tautologically that "economics studies how the economy works". :)
I could as well just edit it, but I'd guess editing wars are frowned upon. So I'm new around here, and, as a non-logged in user, I made some minor changes to the article, most notably in the definitions of microeconomics and macroeconomics. The phrase "which constructs economic phenomena from the behavior of individual actors and firms" was changed to "which constructs economic behavior from the behavior of individual actors and firms" - which makes no sense.
Previously, the page said something about "microeconomics studying the behavior of individual actors", which would rule general equilibrium theory out.
I'm thinking of "Microeconomics builds a theory of economics phenomena starting from its microfoundations - the behaviour of individual families and firms". Somehow, it seems the word "phenomena" is frowned upon, but it's really precisely what I mean here - see phenomenology.
If the talk pages don't show any activity on this in a few hours, I'll edit it again. The old version was imprecise, and the version which replaced mine makes no sense.
I have introduced a definition of microeconomics that mirors the logical structure of the macroeconomics definition. mydogategodshat 01:00, 10 Mar 2004 (UTC)
Your statement that general equalibrium is not macroeconomics is interesting. There is no doubt that gen equl is microeconomics. But this is not the same as claiming that it is not macroeconomics. It certainly deals with macroeconomic topics, even though it is built using microeconomic techniques.mydogategodshat 01:10, 10 Mar 2004 (UTC)
More Capitalism
I am a "newbie" so you can take what I have to say with however much salt you care to.
I was startled, first of all, to find that the word "capitalism" is nowhere actually mentioned in the body of Wikipedia's Economy citation (except in the reference list at the bottom). Capitalism seems instead to have the status of a subcategory in the Business citation. Marxist, Marxism, Marxian, Karl Marx, on the other hand /are/ cited, some more than once.
Whatever happened to good old capitalism guys?
Stirling Newberry Most of the article is a discussion of capitalist economics - starting with Smith, Ricardo, moving through Marshall and Keynes, with some references to later work. However it is worth pointing out the difference between market and capitalism - the two are not the same, and emphasizing that economics is focused primarily on capitalist markets, and to a lesser extent socialist ones.
The authors seem to have carried NPOV to a new and near pathological extreme, as though in an article on psychotherapy, Freud had been banished to the Medicine category and the text was chock full of Jungian philosophy.
Stirling Newberry I think this statement is a bit extreme and insulting.
Your article seems more of a battleground than a source of information on Economics aimed at someone that actually wants to know how it is practised in the world as we know it. Last I looked capitalism was /the/ major economic system on the planet and the End of History was nigh. No problem with discussing its shortcomings but shouldn't one at least mention it?
Stirling Newberry And this one definitely is. The article goes into great detail about the primary activity of economists - making models, collecting data and using supply and demand curves with measurable variables to understand collective behavior.
Wgoetsch 22Mar04
As much as I like salt, particularly with french frys, I have to admit that "newbies" can add a perspective that "long timers" miss, and in this instance I agree with user:wgoetsch in some regards. Wikipedia articles do tend to be idiological battlegrounds with everyone adding a paragraph on their particular school of thought. And I agree that there is no economics in this article. There is little in this article about WHAT economists do or HOW they do it. This is not an economics article and is not intended to be one, from what I can see. Instead, it is an overview of economic concepts as seen by various economic schools of thought and branches of economics. I have no problem with this because Wikipedia does have many good economics articles. See for example welfare economics, supply and demand, production theory, consumer theory, labour economics. These articles however, are of less interest to the general public. Labour economics for example has been a candidate for featured article status for several weeks, but it is not being voted for, presumably because so few Wikipedians are interested in "hard" economics.
You mentioned that capitalism was not mentioned in this article, so I added a bit.
"Missing Link" in the chapter 'Development of economic thought' by a reader from a Post-Communist country
2 April 2004
In our country we haven't had luck to have Ludwig von Mises or any other "Austrian Economist", who would understand topics that no one can understand without embracing "Economic Subjectivism" (see my refutation of its refutation here: http://en.wikipedia.org/wiki/Talk:Economic_subjectivism ) instead of "Economic Objectivism", and we experienced the hyperinflation similar to the German's hyperinflation in 1920's before the collapse of Communism in our country.
After that our economists have been luckily smart enough and didn't accept Monetarism (that was suggested by USA economists) which destroyed some Latino-American economies.
Here is something about "Austrian Economics" that I propose to be inserted after the paragraph on Marxism in the chapter Development of economic thought:
British "objective-cost theory of value" conceptualization inadvertedly led to the "double valuedness" of any object. Any product had two kinds of values at the same time (bread, for example, though higher in "use value" than diamonds, was somehow lower in "exchange value").
This very concept of 'double valuedness' enabled Marx to conceptualize market economy as internally contradictive economic system, a system badly misdirecting resources into "production for profit" (by exploatating the very difference between the "exchange value" and "use value") instead of directing resources (which then communist states did by central planning or by self-managed arrangements in communist Yugoslavia) for "production for use".
As can be seen, British economists' "objective-cost theory of value" conceptualization led to rise of the theory of capitalist exploitation of both natural resources and working class, while they did not deal with the same topics as Marx at all, such as money, capital or business cycles, there were at the same time Austrian economics (founded by Carl Menger who wrote his "Principles of Economics" at roughly the same time as Marx did his "Kapital"), which were first to clash directly with "double valuedess" approach.
Hyperinflation (which later destroyed German economy and made dissapointed German people quite eager to accept Adolf Hitler as their rescuer) was spared the Austrian country mainly due to this Austrian economics approach in 1920s led by Ludwig von Mises, who rejected "double valuedness".
That's one POV, it doesn't happen to accord with much of the evidence on the ground, however.
With annexation of Austria by Germany and Nazi terror Ludwig von Mises emigrated to the United States. There, however, at a time when every communist and social democratic exile from Europe was given a high academic post, the leading Austrian economist Mises was refused such a job, even more, the dean of New York University's Graduate School of Business, Sawhill, has lobbied good students not to take Mises's 'right-wing, reactionary' classes. Neither Mises lived to see the fellow Austrain economist Friedrich Hayek wining the Nobel prize in 1974.
A reader from a Post-Communist country
P.S.
I'd like to appologize for my English. My writing in English language is not very good. I understand it very well, though.
Stirling Newberry All I can say is "are you joking?" the economics sections of Wikipedia lean very heavily towards the Austrian school, much more so than practicing economicsts. There is ample coverage - in some cases more than ample coverage - of Austrian concepts, links to mises and other liberatarian/austrian/"classical liberal" sites. The mainstream of economics is focused on mathematical modelling based on collection of data. The Austrian school is certainly part of the overall economic dialog and is referenced. If someone has specific concepts which are important that need to be included, by all means do so.
I find this bias a little puzzling myself.CSTAR 04:31, 23 Jun 2004 (UTC)
A Reader from a Post-Communist Country 11 Avg 2004
There is clear enough distinction between all the economics sections of Wikipedia and the particular section, the 4th Chapter - Development of economic thought section! Or it is not?? Only this particular section was what I have commented.
And, I must ask you, if this particular section is leaning heavily towards the Austrian school, as Stiling Newberry is trying to convince me (it is I, who should ask him his "are you joking?" question), why he doesn't say something about the actual leaning of this - remember - particular section towards a particular School of Thought, namely the School that inspired the economic experiments that have put many Central European (as well East German) countries that were once parts of the Austro-Hungarian empire, and before WW II economically not so behind their neighbouring countries, now in year 2004 in a position where Old Europe is afraid of our workers seeking better economic conditions elsewhere because of consequences of this economic experiments.
Any statistical analysis of the text (for example the ratio between the number of words that are used in paragraphs that talk about the particular School that you academics in the capitalist countries who yourself never had to live its experiments, love to write about in this particular section, and the number of words about Austrian Economics in this particular section) can be used to show it. In the following paragraph I have counted 129 words!:
In the 19th century, Karl Marx synthesized a variety of schools of thought involving the social distribution of resources, including the work of Adam Smith, as well as socialism and egalitarianism, and used the systematic approach to logic taken from philosopher Hegel to produce "Das Kapital". His work was the most widely adhered-to critique of market economics during much of the 19th and 20th centuries. The Marxist paradigm of economics is not generally held in high regard by market economists, though some concepts from his work are occasionally used in mainstream contexts, particularly in labor economics and in political economy. The term Marxian is in some contexts used to describe work which accepts concepts from his work but does not necessarily subscribe to the political thrust of Marxist thought.
Then there is another 78 words added at the end of another paragraph that IMHO should only say something about whether economics can be applied to all forms of society or not, without any particular School's opinion... however there is added an opinion of one School only. It is I, again, who should state "I find this bias a little puzzling myself" statement, not CSTAR (or Newberry or any of you - academics in the capitalist countries - who, let me repeat, never had to live its experiments! And who never were forced to seek better economic conditions after the fall of some Utopic ideas of some School.)
Marxist economics asserts that history is divided into eras which are determined by which two classes, which are struggling to control the means of production - that is slaves and masters, peasants and royalty, wage workers and capitalists - and that mainstream economics only applies to those societies which are "objectively" industrial, that is to say, societies which are capable of industrial production based on their own knowledge and resources. (See Marxism, particularly "The Hegelian Roots of Marxism".)
And the closest to the mere mentioning of existence of the Austrian School (actually it mentions only general approach of supply-side, nothing more) is the following statement:
The neoclassical school was challenged by monetarism, formulated in the late 1940's and early 1950's by Milton Friedman and associated with the University of Chicago and also by supply-side economics.
As if there wouldn't be enough distasteful, we have to read yet more opinions held by Utopians in the same section again.
Marxist economics generally denies the trade-off of time for money. In the Marxist view, concentrated control over the means of production is the basis for the allocation of resources among classes. Scarcity of any particular physical resource is subsidiary to the central question of power relationships embedded in the means of production.
yours truly, A Reader from a Post-Communist Country
P.S.
I recommand you academics from Not-Post-Communist-Countries that you come live experiments of the Schools you lean to
and then seek better economic conditions in your neighbouring countries, if they would want you at all.
11 Aug 2004
I find the previous ad-hominem textual sequence quite amazing. I for one have lived in many capitalist experiments (I consider myself pro-capitalist by the way) in developing countries (having been born in one) which have resulted in massive income inequalities, social dissruption etc. The attitude which you seem to communicate, that only individuals who have experienced communism have direct empirical knowledge of failed economic systems is not accurate, scientific and frankly hardly collegial.CSTAR 13:40, 10 Aug 2004 (UTC)
Many people have problems distinguishing between economic theory, and the particular government they live under. Clearly our eastern European reader wants more rant fuel against the Soviet Empire. I imagine there are some who want more ranting against the evils of capitalism. These are not, largely, appropriate to "economics". Millions of people have died in famines caused by market economics, millions of people have died in famines caused by command economies, specifically Stalinism and its derivatives. There is an article on marxism where he can jump up and down. As for not "mentioning" the Austrian school, I will point out that a member of it (Robbins) is referenced in the header, that there is a section on marginalism (which is based primarily on Stenger's work) and references in the text, which is as much as the Chicago School gets. There's a whole article on the Austrian school that is linked to. Stirling Newberry 17:03, 10 Aug 2004 (UTC)
As I can see, now, thanks to Susurrus the main article on economics is not distastefully loaded with lengthy paragraphs on a particular School any more. Now they are where they deserve to be, in history (http://en.wikipedia.org/wiki/History_of_economic_thought).
A (now satisfied) Reader from a Post-Communist Country, 4. November 2004
Second paragraph: beliefs
Economists believe that incentives and preferences (tastes) together play an important role in shaping decision making. Sometimes a preference relation can be represented by a utility function. Concepts from the Utilitarian school of philosophy are used as analytical concepts within economics, though economists appreciate that society may not adopt utilitarian objectives.
Could we get rid of Economists believe-- This reminds me of a church. Shouldn't this be something like:
From the distinctive point of view of economic analysis incentives and preferences (tastes) together play an important role in decision making.
Also what meaning does the word "shaping" convey in the original version of the article? Wouldn't it be more informative to refer to a process of decision making (this I admit is idiosyntractic -- I believe in a process view human activity).
CSTAR 16:52, 17 May 2004 (UTC)
Economists doesn't believe.... They postulate that incentives and preferences etc. --212.45.33.21 17:04, 11 Aug 2004 (UTC)
Interesting. Good luck with it. I wonder if anyone will create: Economics: A Graphical and Intuitive Approach. Jrincayc 02:23, 9 Jun 2004 (UTC)
Externalization
I need to reference an article or section that is not present, one that explains the means by which costs are externalized and the effects of this. Examples could be the externalization of health costs by the coal industry or the externalization of costs of defending, suppressing, and replacing countries and governments to ensure cheap motor fuels in the US. I could write something about this but it would not be from the viewpoint of an economics expert. Please notify me when this is available so that I can link to it. Thanks, Leonard G. 21:57, 2 Jul 2004 (UTC)
I believe the phenomenon you're looking for is already discussed at externality. Isomorphic 23:35, 2 Jul 2004 (UTC)
Adam Smith ain't a bad guy
But isn't this picture at the top completely misleading? Or am I just being too picky? CSTAR 01:24, 16 Jul 2004 (UTC)
No reason not to add pics of Ricardo and Marx. Any objections? Any other key figures mentioned in the intro that rate a picture? - David Gerard 10:20, 16 Jul 2004 (UTC)
I added the pic from a position of almost total ignorance on this topic. Please do replace it with a more suitable one! (I wanted to give this article a shot at being featured). Lupin 11:15, 16 Jul 2004 (UTC)
I've just added pics of Ricardo and Marx as well - the three "main thinkers" listed in the intro. There's no pic for Alfred Marshall. I think it looks nice :-) What do you all think? - David Gerard 12:01, 16 Jul 2004 (UTC)
The pictures are certainly better. It does look nice and avoids the impression of canonizing Adam Smith. But what about a picture of something like a supermarket checkout counter or a farmer's market or even the outside of large US discount retail store or even a French one (e.g. in Shenzhen) -- without the company logo (with a caption such as Globalization and the loss of jobs etc.)? CSTAR 13:52, 16 Jul 2004 (UTC)
I see no reason not to have each of these things. A pic of a bazaar. A pic of a reasonably canonical economic graph (both to make a point and say "mathematics"). A pic of these three dudes (possibly shift them down to the "Development of economic thought" section). We must have a good, relevant and eye-candy graph around. Do we have a suitable pic of a market? - David Gerard 14:24, 16 Jul 2004 (UTC)
A pic of a market at the top, dead white European males in "Development". Graph please, someone! - David Gerard 14:46, 16 Jul 2004 (UTC)
Wow, quick on the bazaar picture. I'm sure a PD picture of one of the commodities markets or stock exchanges could be found or someone could go take them. The Chicago Board of Trade is open to public viewing [2] and the Mercantile exchange is too [3]. Pictures of those trading floors might be a good addition. - Taxman 14:51, Jul 16, 2004 (UTC)
Possibly valuable reverted edit
For about 34 minutes, someone replaced the beginning of the article with this:
Economics began as a study of exchange in the hands of Adam Smith. (See Whately 1832). But the neoclassical revolution turned it into a study of allocation (See Robbins 1932). The current orthodoxy or mainstream thinks of economics as a study of allocation. In it, an isolated individual optimally allocates some existing wealth.
The allocation model uses formal mathematics to derive theorems of how allocation decisions are made under any conceivable situation. Mathematicians who do not understand economics issues may do very well as builders of abstract models of all conceievable scenarios. The problem: these have no relevance to real life.
But optimization is not all. Economists also want to know how new wealth is created through entrepreneurship. Neoclassical economics is inherently incapable of dealing with entrepreneurship (see Baumol 1968), which is often counter-optimizing. It just does not know how to deal with collective decision. Arrow's Impossibility Theorem ([click here]) says that it is impossible to formulate a social decision. This is a confession that neoclassical economics does not know how to analyze group decisions. Since all market decisions are group decisions among buyer, sellers, and often also intermediaries, neoclassical economics is unable to say anything meaningful about the market or market events. But it pretends to know everything.
The allocation model is under serious challenge by several heterodox approaches such as the Marxian, the Austrian, the Institutionalist and the Keynesian approaches. Since June 2000, students in prestigious schools in France, England, USA and in many other countries have revolted against the percieved autism of neoclassical economics. (Visit www.paecon.net) So wait to see major changes in this article.
Some of that material may be valuable to work in. Much of it seems to be ripped from somewhere (The click here note gives a clue towards that). Also the warning at the end of major changes seems to be ignorant, purposely or not, of the collaborative editing process we have here. I thought the matrial was, at a minimum, worth discussion. - Taxman 15:09, Jul 16, 2004 (UTC)
It's heavily POV. If someone feels that a particular point of view is worth documenting - Austrian, Keynesian or otherwise - then they should do so. However, the graf as written is a manifesto without substance. There are plenty of challenges to neo-classical economics - from Game Theory, xaos theory, "Total Progress Indicator", Green economics, Marxism, Marxian, Austrian, Neo-Keynesian - and many of these have been documented in wiki. The material doesn't have substance behind it. It could have been written by a LaRouchite. Further, misreading a standard theorum (in this case Arrow's) is usually a dead give away of a POV without sufficient substantiation. Thanks for dropping it here so it is recorded, but it isn't wiki, it's his web site.Stirling Newberry 16:15, 16 Jul 2004 (UTC)
What is the warning at the end of major changes? I was the one that reverted it the previous version. It is not clear if you are suggesting I made a major change in reverting and that I should have left it in the main article to discuss it? CSTAR 16:22, 16 Jul 2004 (UTC)
No, I'm only suggesting exactly what I did. Remove the heavily POV material to the talk page and discuss what of it has merit to go back in once it has been refactored. The material makes some good points and even provides references for some of it. Baumol 1968 might have valuable backing for the point the edit made, and he may have a good point about current orthodoxy focusing on allocation. I'm only suggesting that if there is even a chance that the material can add something to the article it should be brought to talk, not reverted without discussion. Leaving it in the article would keep the article from being NPOV, which is of course, not good. - Taxman 13:47, Jul 17, 2004 (UTC)
I agree that there should be further "interdisciplinary" discussion of alternative viewpoints. Some of the references in the "French section" are worth looking at, this even if some might cringe at a site which lists Bruno Latour as reference - the link fails, helas.(I have long since given up on poking fun at "post-modernists". Even though my original sympathies were with Sokal in that war, I think in the end the post-modernists got the last laugh and in the end who will be remembered -- Foucalt surely.). Robert Solow has a somewhat apologetic article in French and then there is this, from Ces merveilleux manuels américains
Tout le monde loue - pour leurs qualités pédagogiques, leur accessibilité et leur absence de formalisme - les ouvrages sur les "principes de l'économie" publiés ces dernières années par des auteurs américains réputés, tels Mankiw et Stiglitz. Couleurs, photos, extraits d'articles de journaux sur des problèmes d'actualité, raisonnements simples et décomposés à l'extrême : le produit est alléchant. Ces ouvrages connaissent des tirages très importants : Mankiw a touché plus de 2 millions de dollars avant même d'avoir écrit une seule ligne...
Translation
Everyone hails, by their pedagogical style, accessibility and absence of formalism, works on "Economic Principles, published in recent years by well-known american authors, such as Mankiw and Stigliz. Lots of color, photos, excerpts of journal articles on current day problems, simple and extremely incremental reasoning. These works have large numbers of copies sold; Mankiw has earned 2 million dollars even before writing a line
which, hey who can disagree with that? This is all very nice, but really, does any of this belong in an expository article on economics? This is mostly dedicated to the teaching of economics rather than economics itself.
But it gets a great deal of it wrong - economics, if by this you mean the study of economic behavior - goes back to Plato and Aristotle, who saw it through the tension between individual gain and the necessity for collective defense (see the evolution of the polis in Plato where the "feverish city" falls under attack because it has not ability to unify and defend itself). This viewpoint is the subtext of Wealth of Nations - note the title, the Wealth of Nations - and the importance of a social decision to engage in market behavior, which Smith outlines in Book I, and also in his other work. The name alone "Post Autism Economics" should be a clue that the writers of it are, shall we say, fringy. References mean nothing - every fringe group can site passages which show the evils of the past and where they came from. It's easy. As for "the study of exchange" and the "study of production" - that's the rough and ready distinction between "economics" and "political economy". Political economy assumes that political, collective, decision making manifests itself in measurable ways which alter economic relationships. What I don't see is anything in the passage which hasn't been dealt with in the various wiki articles. What's documentable here? A web site that declares economists and mathematicians are autistic? Replaced with what? A vague sense that people want something different? When the POV has something to document, and a visible sign that it has adherents and a self sustaining discourse, then it's worth documenting.
I'm very sympathetic to challenges to neo-classical economics - being the author of one - but by the same token, we have to have something to document here. If you feel the criticisms of the neo-classical synthesis need to be strengthened with some of the citations, by all means go ahead and do that. That's something that is documentable: POVs that question exchange as the basis. Stirling Newberry 14:06, 17 Jul 2004 (UTC)
Pictures
I would like to suggest we put the pictures up for a vote - enough people seem to have enough strong feelings about this to make it worth reaching a consensus. Stirling Newberry 16:17, 16 Jul 2004 (UTC)
Suggested have been:
The bazaar in action: Chichicasternango Market, Guatemala
I have seen no objection to the pics so far. Unless you're actually objecting here. The article clearly needs pictures, and there's nothing wrong with it having lots of pics, as long as they're all relevant and say something - David Gerard 16:26, 16 Jul 2004 (UTC)
I'm not objecting, but with 3 changes in less than 24 hours, and no a priori reason to have one over the other, it just seems better to discuss it than have people come along and decide "that's not economics, this is economics". Stirling Newberry 16:51, 16 Jul 2004 (UTC)
I can whip up an XFIG picture of something like an Edgeworth box, turnpike growth path etc. I gave up on the idea of digital camera and taking a picture of the outside of Walmart (I'm too chicken). I don't think the pictures at the top should be of people. I like the picture of the Chichicastenango market.CSTAR 16:37, 16 Jul 2004 (UTC)
The market pic's very, um, Economist, isn't it ... I'm assuming some of the harder economics articles, or related mathematics articles, will have graphs'n'stuff. If they don't, they should - David Gerard 16:42, 16 Jul 2004 (UTC)
Look nice that you choose picture, when i shoot it i wasn't really thinking that it was going to illustrate a Economics article. if you come up with an idea about an object or illustration that represent economics i would try to come-up with a picture. Cheers, Chmouel 18:13, 16 Jul 2004 (UTC)
The more specific economics articles do indeed have some good, crunchy graphs. Off the top of my head I remember labor economics as a good example. Isomorphic 00:45, 17 Jul 2004 (UTC)
I would add Keynes, since he basically started macroeconomics. In terms of graphs, I would use a supply and demand graph, since it's simple and ubiquitous and it's the first thing every intro student learns. All the ones at supply and demand are icky and pixellated, though. --Taak 22:13, 17 Jul 2004 (UTC)
We have a Keynes image, Image:Keynes.gif, but there is no copyright or attribution information on it so I'm reluctant to add it. A Keynes image that's GFDL or public domain would be ideal. (Fair-use or by-permission images are allowed on Wikipedia, but discouraged.) Image:Demand shift out.png has the right aesthetic qualities whilst being reasonably comprehensible at a glance - I'll see if there's somewhere sensible to put it - David Gerard 21:42, 18 Jul 2004 (UTC)
I've just added Image:Demand shift out.png in the relevant section. It does look a bit crappy and pixelated; anyone sufficiently motivated can draw a replacement for it and update the image - David Gerard 21:47, 18 Jul 2004 (UTC)
Does the following image look any less crappy? ANy minor edits are easy to make (even color!)
Antialiasing would be nice - the curves have nasty jaggies. Perhaps you could upload a bigger version and use wikipedia's thumbnailer? Lupin 08:17, 19 Jul 2004 (UTC)ft out.png]]
Here's a somewhat bigger example, perhaps better, although maybe this defeaning silence is a subtle hint. It's OK, I can take rejection. File:Supply-demand-humungous.pngsupply demandCSTAR 17:44, 19 Jul 2004 (UTC)
Looks good, I would just propose labeling the supply curve too to be accurate. - Taxman 18:31, Jul 19, 2004 (UTC)
I like it, but now that you bring it up, color would make it even more perfect. Best would be color and a non color method of differentiating the supply and demand, like dashes. That way print in B&W or color blind people could still tell the difference. Sorry to be picky. - Taxman 20:38, Jul 19, 2004 (UTC)
Should I replace the supply-demand picture? CSTAR 20:21, 21 Jul 2004 (UTC)
Well I was hoping for dashes in the supply line to facilitate making the difference between the two curves more obvious in the case if it was printed in B&W. Then the picture could be used for the supply and demand article too. And when I took you up on your offer of color, I was hoping you weren't thinking of those colors. :) Maybe something more along the lines of primary colors? Sorry to be picky, but I guess its easier while you're at it. - Taxman 21:11, Jul 21, 2004 (UTC)
Perfect as far as I'm concerned ;-) Now we just need a picture of Keynes that isn't of dubious copyright status ... - David Gerard 11:41, 22 Jul 2004 (UTC)
Oh, and if you're on a roll, the pixely things in supply and demand could probably do with being replaced similarly - David Gerard 11:46, 22 Jul 2004 (UTC)
Misc Errors
Hello, I think this sentence is incorrect: "There is some degree of tension between economics and ethics, another of the most basic social sciences, which tends to avoid quantification and emphasize balances of rights." Ethics isn't a social science, i.e. it hardly, if at all, conducts experiments or studies empirical findings as a science does. It is a humanity, like philosophy, in that it uses rational arguements to make its case. If it is agreed, then let's change social science to humanity or other equilivant word. --ShaunMacPherson 06:33, 3 Aug 2004 (UTC)
Polities vs. Politics
Someone inserted a query about the phrase "the economy of polities" into the article, wondering if it should read "the economy of politics." I don't know the actual quote, but from context the answer is probably that it's correct as written. I believe "polity" is a political entity such as a state. The use is therefore appropriate. Isomorphic 02:50, 4 Aug 2004 (UTC)
Well for one, the value of currency (fiat or otherwise) is based on a system of trust-- is that valiue intrinsic to the currency or to something else; I'm not sure that's what the problem with the original formulation, but the notion of intrinsic economic value is certainly dubious. CSTAR 23:18, 11 Aug 2004 (UTC)
Intrinsic value refers to the material fiat money is made of. Paper is intrinsically (almost) worthless as opposed to gold or silver. I don't think that's POV.--Fenice 10:03, 13 Aug 2004 (UTC)
I just saw that the quote comes from a caption without further explanation. As I said, I don't think it's POV. But the sentence is hard to understand in this context, so I support removing it.--Fenice 10:12, 13 Aug 2004 (UTC)
First the definition of the US dollar as a "fiat currency" is debateable - some say it is, and some say it isn't. Intrinsic value is another notion that is economically debatible, since many economists, do not believe there is any such thing as "intrinsic" value. It is certainly not an assertion to be made in a caption. It's POV - namely gold bug POV. Stirling Newberry 14:40, 13 Aug 2004 (UTC)
I don't quite follow how one can dispute that the dollar is fiat money. I must be one of those ultra-conservatives that the fiat money article says define fiat stringently. "Intrinsic value" does seem debatable, but I'm sure we could work around that. Maybe not at a length that would make it reasonable to include in the caption. - Nat Krause 15:20, 13 Aug 2004 (UTC)
There's a whole long article at fiat money on this. The difference between asset money and fiat money is controversial, and therefore not something to assert. More over the caption takes a very specific POV - namely that representative money has intrinsic value - and that is something that even many gold bugs don't agree with. Stirling Newberry 16:17, 13 Aug 2004 (UTC)
Would it be safe to say that most currencies today are not directly pegged to the value of precious metals? --Taak 04:31, 31 Aug 2004 (UTC)
It would also be safe to assert that most money isn't in the form of coinage. But the point is... What? Is this the most important fact about money? Or more to the point, is it the most important fact about money in relation to the discipline of economics? Or is it something that some people want to point out for their own POV? We've got gold standard, Austrian economics, money, fiat money, paper money, Bretton Woods, supply side economics, Austrian economicsmacroeconomics -- plenty of places to go into the subject in as much detail as is required for any one. If people feel it is important, add a sentence on monetary basis and the arguments over central banking and legal tender... Stirling Newberry 04:42, 31 Aug 2004 (UTC)
Clarification
The sentence regarding Say's Law struck me as cumbersome and in need of a little improvement. icut4u 22:03, 30 Aug 2004 (UTC)
Ethics and Social Science
Ethics is most certainly not a branch of the social sciences (unless one really means an ethnographic study of moral codes, which does not seem to be the case). Not in any university I know, and not even on the social science article the sentence references and that is linked hereto. Ethics is part of the humanties, specifically, philosophy. In fact, there is also a kind of quantificationin branches of ethics...for example, the application of game theory (Nozick, Williams, and others) and, in metaethics, where philosophers make use of formal, logical construction. I corrected the sentence to reflect these facts.icut4u 04:32, 4 Sep 2004 (UTC)
Phillips Curve and Inflation
Phillips Curve:
Phillips Curve shows the relation ship between increase in money wage and the unemployment rate.It depict very important point about the rate of increase of inflation and the rate of unemployment.This is really a wonderful theory and talk about the historical data and its relationship with unemployment.The following diagram represent this relationship
Faraz Akhtar
Utopia Theory
That was recently added to the article as a 'new' field of economics. For one thing I don't think that is new or a valuable addition, but I didn't want to unilateraly revert. What do others think? - Taxman 17:05, Dec 2, 2004 (UTC)
Anything is possible. However I would say chuck it, unless someone provides an academic reference or an economically meaningful definition of what a utopia is (I dunno, some game theoretic property of Nash equilibria in relation to something else, coming up with the def ain't my problem). I don't have a clue what this could be. CSTAR 17:41, 2 Dec 2004 (UTC)
A quick google search found an article in PhysicsWeb that uses the term Utopia theory. The article describes it as the intersection between physics and the social sciences. An interesting read with a further reading list at the end. Edwinstearns 18:20, 2 Dec 2004 (UTC)
Actually that's pretty reasonable. Here is the addition. If it can be substantiated with credible references it can certainly go back in: - Taxman 18:42, Dec 2, 2004 (UTC)
"A new field in economics is the study of the feasibility of making society a utopia, dubbed utopia theory."
The name seems soemwhat of a misnomer; something like statistical microeconomics might have been a better name (no I am not suggesting we call it that. WP is not in the business of assigning names). However, there is something called economic physics which appears to denote something similar. I also notice that none of the references cited in the Physics Web article refer to it as Utopia theory. I suggestion caution before sanctioning the name Utopia. CSTAR 18:57, 2 Dec 2004 (UTC)
This is the main article on economics. I see little value to mentioning minor theories here, even if they are real and legitimate. Such material belongs further down in the Wikipedia depth chart. Besides, the article on Utopia theory seems kind of looney, or at least poorly explained. Isomorphic 19:30, 3 Dec 2004 (UTC)
I look at the first sentence from October and it seems much better. It seems to have gotten worse since then. Or at least more narrowly defined, it seems to define economics as a certain school or schools sees it. It was broaded before. That it is focused on price was added since October, but is all economics focused on price? The early economists from Adam Smith to David Ricardo and so forth were not really price-obsessed, and there continues to exist a focus on other aspects of economics such as say production, although of course probably not among economic professors at American business schools. It also adds that this is "seen through the lens of allocation of scarce resources". This is another definition narrowing it in terms of economic schools. Some people might see it through the lens of the value provided by labor.
The paragraph after that is a recent addition (last two months), which also explains economics through the lens of one particular economic school. I'll deal with that later. Ruy Lopez 07:06, 8 Dec 2004 (UTC)
I've created a section called "Schools of economic thought" with a subsection called "Neo-classical economics" into which I've moved some of the neo-classical assertions to. The opening four paragraphs now seem basically broad enough to encompass all of economics, but two paragraphs there previously asserted ideas of the neo-classical theory which I moved to the sub-section. Ruy Lopez 12:55, 9 Dec 2004 (UTC)
Recently added: "It studies allocation mechanisms that describe how to distribute limited resources among unlimited wants of people." So would there be no "economics" of a situation of abundance, such as the Potlatch cultures of the Northwest Natives? -- Jmabel | Talk 04:02, Feb 21, 2005 (UTC)
Maybe it would work to just insert "generally" or a similar modifier? Maurreen 07:16, 21 Feb 2005 (UTC)
Potlatch is an unusual phenomenon known as a gift economy. Even then, it's still a system of distribuitng limited resources; if resources were truly unlimited, no transfer or trade would be necessary. -- Scotteiπ 06:17, Mar 10, 2005 (UTC)
But it was mostly a creation of artificial scarcity, often ritual scarcity, in the face of abundance. For example, at times the potlatch consisted of ritual destruction of objects: someone might display his wealth and stature by burning blankets. For a further example, in some contexts a high gift value was placed on charred, partially destroyed ritual objects that had been burned in potlatch ceremonies. This is much more a matter of managing abundance than of managing scarcity. -- Jmabel | Talk 06:54, Mar 10, 2005 (UTC)
The description for Neo-classical economics starts "Neo-classical economics begins with the premise that resources are scarce and that it is necessary to choose between competing alternatives." Frankly I just don't get it - does that imply that Keynsian Economics starts from a different premise, a premise that resources are not scarce? Does Marxian Economics start from the premise that one can in fact choose multiple alternatives? (Schroedinger's cat eat your heart out - we can have our cake and eat it too... At the same time!) Rather, I think that this characterisation of Neo-classical economics may be just the tiniest bit misleading. - JS 05:41, 10 Mar 2005 (UTC)
Arguably, some Marxian economics does not start from the premise that resources are inherently scarce. -- Jmabel | Talk 06:58, Mar 10, 2005 (UTC)
A modest question
Material flow:
Extractors => Raw Materials => Raw Material Transport => Processors => Product => Distribution => Consumption
According to what I understand to be the "laws" of economics, under the following circumstances one would expect a certain result:
1.) A raw material (crude oil)is provided at market price under production volumes, but not prices, determined by a cartel (OPEC) to a number of processors (manufactures, in this case a number of refiners) who provide a product for distribution to consumers (various products, but predominantly motor fuels). End consumer market prices are set by supply and demand, as are raw materials prices to the processors under the production restraints imposed by the cartel. Assume that the flow-through and pricing have stabilized.
2.) a processor is disabled. Under the laws of economics (as I understand them), the price of the raw material (crude oil) should decrease (since demand is now decreased) or remain constant (if supply of raw material is reduced by producers in response to changed market conditions) and the price of the product should increase (assuming constant demand and reduced supply due to reduced supply from the processors.
Recently, there was a refinery explosion which disabled about 3% of the U.S. processing of petroleum products.
Contrary to the expectations outlined above, the price of crude oil ("Raw Materials" above) increased.
This seems counter-intuitive. Can any expert explain this in rational market terms?
Thanks in advance, Leonard G. 03:51, 28 Mar 2005 (UTC)
Answering Modest Question
This is the first time I've posted anything on Wikipedia before, but I had to answer Leonard's question.
If a processor is disable, demand doesn't shift back, supply shifts back. This is the cause for the price increase. It is also, to an extent, the main ideas behind Reaganomix, Thatcherism, and suppl-yside economics, only with the AD/AS model instead of a simple basic supply/demand graph.
I might as well pose a question of my own. Higher taxes on the rich and less on the poor are supposed to help income disparity right? Well, when I look at the basic supply/demand graphs, the exact opposite happens.
Take a the high-end income labor market, for example, and say taxes are increased on those laborers earning high-income. This in turns increases their costs, and because of this, shifts their supply curve back. In response there are less high-end laborers, with even higher incomes. The point of more taxes on the rich is to create more less-income laborers.
Oddly enough, the same things happens with low-income laborers. If taxes are decreased on low-income laborers, this means less costs, which means their supply curve shifts outward. Because of this, the equilibrium price causes more poorer laborers.
Thoughts on this?
Labour is a somewhat weird market. Increasing the wage recieved can either decrease or increase the amount supplied. Some people will see a wage increase and think, now I don't need to work as much to earn the amount I need to live on. Others will see a wage increase and think, now I can get more money per hour of leisure that I give up, so I will work more. Which direction people will go depends on personal preferences. As for your other question, think about this: Is your goal to decrease inequality between incomes, or is it to raise the income of the lowest portion? If I am thinking correctly about what you said, you are decreasing the number of rich relative to the number of poor, which should decrease income disparity, which is the original goal. Jrincayc 12:49, 8 Apr 2005 (UTC)
Labor markets are also heavilly dependent on culture. For example, U.S. laborers tend to respond to raises in pay by working more, so they can make more money (Americans are crass materialists, obviously.) Laborers in Mexico tend to do the opposite: they decrease their hours when wages go up (Mexicans are lazy, obviously.) It has to do with the relative values give to leisure time and material goods. Isomorphic 13:21, 8 Apr 2005 (UTC)
Allocation
Hi. Does anyone think the opening should define economics as the study of resource allocation instead of production and consumption? After all, not all of the problems studied by economics directly involve produciton and consumption. It's usually defined that way. Does anyone think that's POV? Mgw 23:42, 14 Apr 2005 (UTC)
Request for references
Hi, I am working to encourage implementation of the goals of the Wikipedia:Verifiability policy. Part of that is to make sure articles cite their sources. This is particularly important for featured articles, since they are a prominent part of Wikipedia. The Fact and Reference Check Project has more information. Thank you, and please leave me a message when you have added a few references to the article. - Taxman 19:20, Apr 21, 2005 (UTC)
Question about the definition
Can anyone clarify for me what is meant by the phrase "through measurable variables" in the first sentence of the article? - Nat Krause 10:21, 25 Apr 2005 (UTC)
I can't. That part doesn't sound like any definition of economics I've heard. After all, in micro you deal a lot with utility, which is completely unmeasurable since no one even believes in absolute utility any more. Isomorphic 18:16, 25 Apr 2005 (UTC)
That's the point. Micro deals with revealed preferences from which ordinal utilities can be shown to exist. An assertion involving cardinal utilities is not "a meaningful theorem": this means that it's not in principle falsifiable, which is one criterion of meaningfulness. CSTAR 18:39, 25 Apr 2005 (UTC)
But the ordinal utilities are still not "measurable" in any normal sense of the word. "Measurable" implies some observable quantity to be measured. You can infer preferences directly from observation, but preferences are just an ordering, not a quantity. Isomorphic 19:52, 25 Apr 2005 (UTC)
Perhaps, but I think your usage of measurable in this sense is too narrow. A preference is an abstract object, but abstract objects can also be measurable. For instance, experimental quantum physicists measure momentum in a laboratory; in quantum mechanics momentum is a self-adjoint operator. That's pretty abstract.--CSTAR 20:35, 25 Apr 2005 (UTC)
It's not abstraction that's bothering me here. My point is that there is no quantity that can be measured. Observation can establish a preference relation, but the step from preference relation to utility function involves an arbitrary choice. There are a continuum of functions that would satisfy a given preference relation. Given that, you can't call utility a "measurable variable".
My underlying point is that I don't see "measurable variables" as being central to the practice of microeconomics. The typical methodology of micro is to construct a mathematical model and then see if it what it produces looks reasonable. Nobody cares much about measuring the underlying variables like value, as long as the model's output looks reasonable. Experimental economics exists, but it doesn't have nearly the kind of importance in microeconomics that experimental physics does in physics. Isomorphic 21:07, 25 Apr 2005 (UTC)
The step from preference relation to cardinal utility function involves an arbitrary choice. And even though much of microeconomic theory (such as general equilibrium theory) is not ordinarily thought of as "empirical", it would be very strange to argue that its results aren't emprically testable. When you say the model's output looks reasonable doesn't this imply some empirically observable assertions?
But in any case, if the phrase measurable values bothers you, please change it. I didn't put it in, although I do have some philosophical sympathy for that notion. Unfortunately, I've been getting too bogged down with philosophical discussions of late in WP. If you want entertainment, look at Talk:Bell's theorem.--CSTAR 21:26, 25 Apr 2005 (UTC)
Associative Economics
Seems like a euphemism for socialism.
Etymology
It was wrong. And I think the greek spelling is still wrong, but I don't have a dictionary with me. --pippo2001 09:54, 2 Jun 2005 (UTC)
Category sorting
I've been slowly working on Category:Economics and am hoping that anyone who watches this page might be able to help. The main category has more than 150 articles and many should be sorted into subcategories. I don't know much about the subject. Maurreen 23:44, 12 Jun 2005 (UTC)
Reverted edit on June 19th
I reverted the edit made by 82.32.64.213 on June 19th to last version by Muijzo. That user then reverted the edit that I made. The only thing I agree with his change is the term "ceteris paribus". UH Collegian 17:13, 19 Jun 2005 (UTC)
Sorry didn't see this before my latest revert. Can you explain what you don't agree with in my edits? Is "study of incentives" inappropriate?
I would be happy to do a version which combined aspects of both - just that I am not happy if my edits are reverted without explanation as to why it was done.
--82.32.64.213
Perhaps I will begin with an explanation of my edits:
1. 'Study of incentives': Economics is about making constrained choices - and thus is essentially about the incentives behind each and every choice. I was inspired to make this comment from the book/website Freakonomics - as it seems rather apt at describing Economics.
2. Ceteris paribus: No need for explanation =)
3. Removed 'radical' because "marxist" doesnt necessarily imply radical: In an European context, Marxism is a foundation of many social democratic parties. Denoting that something is 'radical' seems against the NPOV.
4. 'Normative' can be described for all forms of Economics - if one adopts a positivist approach, one may see certain parts of economics as positive and others as normative - but if one adopts a post-postivist approach, one would argue that certain positive statements are in fact normative, in that it makes the suggestion of keeping the status-quo. A NPOV should accept both views.
I am not happy that just having my edited reverted, e.g. by UH Collegian and 63.20.123.105 without explanations; I am happy for changes to be made, if they are discussed first. Perhaps, there's a better way to express what I have wrote - in that case, edit it rather than revert it!
--82.32.64.213
I agree with 82.32.64.213's edit, and I will unrevert any reverts of it unless the reverts are documented with specific and actionable reasons for the revert. That said, if there are good reason for reverting it I will read them. UH Collegian, what specificly did you disagree with and why? Jrincayc 21:57, 19 Jun 2005 (UTC)
Okay, the only thing I did not agree with 82.32.64.213's edit was that the user removed "radical" but after the user's rationale, I think it is okay with the removal. I hope no one took it personally that I reverted an edit because at first I thought his edit was not NPOV. However, I would like to change the definition for ceteris paribus to "all things equal". I believe that is a better definition. UH Collegian 01:48, 20 Jun 2005 (UTC)
The context that I hear ceteris paribus in economics usually would be all else equal, rather than all things equal, but I could be wrong. Sometimes when I revert something that I am not sure about reverting, I make sure and add something like "feel free to discuss in talk" to the edit summary message, so that it is more obvious that I think there might be justification for it. Jrincayc 02:22, 20 Jun 2005 (UTC)
Maybe it has to do with regions that we are in. I am from Texas and people down in Texas refer to ceteris paribus as "all things equal" and that is what all I have been hearing at the University of Houston. UH Collegian
The wikipedia article on Ceteris paribus lists as a translation: "other things the same", so probably that is the more common usage. Jrincayc 12:31, 20 Jun 2005 (UTC)
Yes clearly it's not all things equal because when using ceteris paribus, the point is to discuss a change in one thing holding the rest equal. That change means not all things are equal. So your university is at odds not only with how it is used everywhere else, but when it comes down to it, common sense too. Also at issue here, is reverting a change instead of just discussing it. When will people reallize that reverting changes that are made in good faith only leads to resentment and revert wars? Unless an edit is vandalism or is actively negative for an article, just discuss on the talk page why you disagree with the edits. If there is no response, then revert or adjust. Clearly that would have been better in this case since, UH Collegian, you started out saying "The only thing I agree with.." then moved to "The only thing I did not agree with..." then after reading the user's rational you agreed with the changes. The hard feelings (which could have gotten much worse) could have been easily avoided by the method I just outlined. Finally, to the anon, while you don't have to register, it does make keeping consistent conversations with you much easier, and you'll find people will automatically have a higher level of respect for your edits. - TaxmanTalk 15:10, Jun 20, 2005 (UTC)
I find "all things held constant" and/or "all other things equal", etc. in most literatures (academic journals, etc.) so it is not just my school. I am an accounting major, not economics, so we (business majors such as accounting and finance) think a little differently about the world than economics majors. UH Collegian 18:05, 20 Jun 2005 (UTC)
But the difference between those is what I was getting at. Its all else or all other things, because the point of the exercise is to vary one of the quantities while holding the others constant. But that's not what your edit to the article says, so I'll fix it. The phrase may even literally mean "all things equal", I don't know latin, but that is not helpful for how it is used. As Jrincayc noted, our ceteris paribus article makes the translation as "other things equal", which preserves the important distinction. Also the ceteris paribus discussion really should be a bit more prominent than being down in the 'Economics and other disciplines' section. It's really a lot more central to economics. - TaxmanTalk 19:02, Jun 20, 2005 (UTC)
On etymology
The greek word oikos is spelled actually "οίκος", and "νέμω" is an archaic verb, meaning literally "to distribute", although it later received also the meaning of "rules" ("law" is a better translation to "νόμος", as "rule" is "κανόνας"). "to distribute" is actually more accurate to the meaning of economia. I can assure that, since my native language is Greek. Please edit this page; the server seems to be down at this moment.
No, that is not correct. Please refer to an Etymology Dictionary if you have doubts. This are just two of the descriptions:
c.1530, "household management," from L. oeconomia, from Gk. oikonomia "household management," from oikonomos "manager, steward," from oikos "house" (cognate with L. vicus "district," vicinus "near;" O.E. wic "dwelling, village;" see villa) + nomos "managing," from nemein "manage" (see numismatics). The sense of "manage the resources of a country" (short for political economy) is from 1651. Hence, economic (1835) means "related to the science of economics," while economical (1780) retains the sense "characterized by thrift." Economist is 1586 in the sense of "household manager," 1804 meaning "student of political economy." Economy (adj.) as a term in advertising at first meant simply "cheaper" (1821), then "bigger and thus cheaper per unit or amount" (1950). FROM Online Etymology Dictionary
The basic notion contained in the word economy is “household management”. It comes from Greek oikonomia, by way of French or Latin, and means the “steward of a household”. This was a compound noun formed from oikos, “house” and nemein, “manage”. The original sense “household management” was extended into English. It broadened out in the 17th century to the management of a nation’s resources, while the use of the derivative economics for the theoretical study of the creation and consumption of wealth dates from the early 19th century. From Ayto, John. Dictionary of Word Origins. New York: Arcade Publishing, 1990. --pippo2001 01:16, 25 July 2005 (UTC)
Someone recently moved the link to Tutor2u up near the top of the list. I'd never looked at it before, so I followed it, and basically got a splash page of ads, with content down the right margin. Should we link this at all? If so, does it really belong near the top of the list? I think not. -- Jmabel | Talk 04:36, July 21, 2005 (UTC)
Depends on the quality of the content. If it's not very high, remove it. If it's decent, move it to a more appropriate spot in the order. Lots of these advertising sites love to have links from Wikipedia since it raises their search engine ratings. I'm wondering if we have some guidelines written up about what to keep and what not to, beyond the small bit in Wikipedia:What wikipedia is not. - TaxmanTalk 15:34, July 21, 2005 (UTC)
Improvement Drive
The article subsidy is currently nominated to be improved on Wikipedia:This week's improvement drive. If you want to support the article, you can vote for it there.--Fenice 17:50, 4 August 2005 (UTC)
You might also be interested in Grameen Bank, an institution involved in microcredit loans in the third world. Vote for Grameen Bank on WP:IDRIVE.--Fenice 06:27, 6 August 2005 (UTC)
Legal people
I think Economics would benefit from having a List of legal topics type list. I was talking to MyDogAteGodsHat too, does anyone know if there is a similiar topic for economics, and if there is a redirect to it from List of economic topics would be useful. --ShaunMacPherson 06:45, 11 August 2005 (UTC)
This sentence is just plain wrong:
"One way economists deal with this is to qualify discussions of economic choice by noting the qualifier ceteris paribus ("all other things held constant...") referring to moral or social factors that are (for the sake of argument) held equivalent for all choices that one might make."
The ceteris paribus assumption has nothing to do with ethics but is rather the simple recognition of the fact that at any particular time a given phenomenon is subject to multiple influences and in order to understand any of these we must consider them one at a time - all other things being equal. The way economists usually deal with ethical issues is by distinguishing between Positive (is) and Normative (ought) economic statements (which said distinction should be mentioned somewhere in the article, perhaps along with social welfare functions and the like). radek
economics and scarcity
Every few months I look at the opening to this article and see an opening like the current one: 'Economics (from the Greek οίκος [oikos], 'house', and νομος [nomos], 'rule', hence "household management") is a social science dealing with the allocation of scarce resources to meet alternative ends; the science of scarcity.' This does not describe what economics is though, it describes what one school of economics, neoclassical economics deals with. To quote from that web page - "...neoclassical economists have built a structure to understand the allocation of scarce resources among alternative ends..." OK, but neoclassical economics does not describe all schools of economics, just one school of economics. This is like saying religion is about the worship of Jesus. Religion is about the worship of Jesus, but it is about other things as well, for some people it is the worship of Vishnu. I keep removing this definition, but people keep putting it in, I think most English-speaking people don't even realize there are economic schools other than the neoclassical one. Ruy Lopez 18:42, 4 September 2005 (UTC)
I made a few more edits to the opening. Someone inserted a lot of stuff mentioning economics in a narrow neoclassical context. It can not be so narrow, it must be broader in the opening. As I said before, religion is about worshipping Jesus, but it isn't only about worshipping Jesus, and economics isn't all about the neoclassical school. In my mind, the best thing to do is have this broad in the beginning, and then get into the details further down in the article. I think the religion article is a good model. In the opening here we had "the allocation of scarce resources to meet alternative ends; the science of scarcity...competing alternative allocations of goods...choices...when a particular resource or good becomes scarce...choice subject to constraints". I mean, how many times can you repeat the same thing? Allocation of scarce resources, scarcity, alternative allocations of goods, good becomes scarce, choice subject to constraints - someone just rephrased the same idea three or four times and repeated it in the opening. Beyond this redundancy, it is not about economics but the description of one school of economics. Ruy Lopez 19:02, 4 September 2005 (UTC)
I agree completely; I'd made some similar edits a while back, but at the time I seemed to be spitting into a very powerful wind. -- Jmabel | Talk 19:29, September 4, 2005 (UTC)
Question: were does the term "scarce" come from in the definition "household management", to use the equation "science of scarcity"? nobs 19:19, 10 September 2005 (UTC)
While I disagree with the claim that economics deals specifically with scarce resources, nobs, there seems to be a fallacy in your question. Etymology is not definition. After all, economics is not about households any more, even if we take household in the broader Greek sense of a reasonably self-sufficient unit. -- Jmabel | Talk 02:23, September 11, 2005 (UTC)
More importantly, the opening definition of economics here contradicts with the definition in the Wiktionary, which is "1. Social science that studies society's allocation of scarce resources to meet unlimited wants and needs. 2. More generally, the social-scientific study of resource or wealth management, production of new material goods and services, distribution of benefits among individuals and groups, investment and consumption." This seems like a much better definition to me and perhaps the article should open with a variant of this? Rob 14:27, 28 September 2005 (UTC)
This is not economics, it is neoclassical economics. It would be like saying religion means the worship of Jesus. Yes, if you live in the US, it seems like this is what religion is, but it is not to people in rural India or Thailand, or even Israel. Billions of people are Christian, and Jesus exists in the pantheon of the world's billion plus Muslims, but it does not make all religion the worship of Jesus. Wiktionary's definition is wrong - Merriam-Webster[4] has a better definition Ruy Lopez 17:05, 11 November 2005 (UTC)
There seems to be a continual drive to define all economics as neoclassical economics in the introduction. This despite there being a neoclassical section in the article, a "mainstream economics" section which is neoclassical, and most of the article focusing on aspects of neoclassical points of focus or stating neoclassical theories as fact, such as that price is determined by supply and demand. Ruy Lopez 17:05, 11 November 2005 (UTC)
I agree that the definition of economics shouldn't be just "study of scarcity" since that is only one of many possible definitions. At the same time there's stuff that's just plain wrong whenever 'neo-classical economics' come up. For example in the Scarcity Definition it states "It ignores how values are fixed, prices are determined and national income is generated" which is just false. Neo-classical economics, or economics based on the idea of scarcity more generally does not ignore any of these. Unlimited wants and limited means determine prices, labor/leisure choice, production etc. I mean, if you take out prices and output, what exactly is there left in neo-classical economics? Apparantly it doesn't study anything but scarcity for it's own sake. At this point I'm not going to make any edits, but I really do think that portions of this article should be revised.radek
Suggestion: Perhaps we could define economics as a social science that occupies itself with the study of how resources (which happen to be scarce) are allocated amongst competing interests given that the resources have alternate ends. It also examines the effects of a change in the allocation of resources and the agents that are responsible for the change (e.g. consumers, theories, government policies). Therefore it examines the cause and effect relationships of how, why and to what end resources are allocated.
The above is intended to be a rough version of a definition and I hope contributers to this site can smooth it out. I have tried to use terms that do not solely relate to one school of economics or to all except one. Unfortunatley if I have repeated what is generally associated witth neoclassical economics then it is only because all schools of economic thought are instrinsically tied to one another. Most if not all schools of economics begin from or owe thier origin to the study of the cause and effect relationships associated with resource allocation. M&Ms —The preceding unsigned comment was added by84.203.147.210 (talk • contribs) 21 Dec 2005.
I suggest this discussion is getting itself tied up in philosophy as well as trying to define what the word economics currently means. Generally any word has an accepted meaning, and if I look up most student text books on economics it will say something along the lines of "economics is the human science which studies the relationship between scarce resources and the various uses which compete for these resources", which is not too bad a starting point from a lay persons point of view. We should note that resource in economic society are only scarce as opposed to rare because of the insatiable wants as opposed to needs of human beings. As soon as one want is filled, due to our competitive nature, we want more, now you could branch off into biology, psychology and evolution, and the whole structure quickly becomes unworkable. One of the great things about this site is all the links which allows one to jump and branch off into all these related subjects (and get hopelessly lost, but hey its fun). All things are connected, language is imperfect, stop trying to make this perfect (impossible), rather work to make it useful. The people above clearly do not need this article, they are experts and perhaps enjoy arguing a POV rather than help educate others. I'm a beginner and reckon it's not too bad. I agree it is important to get to alternative views and models but lets start with the basics so someone like me has some chance of making sense of it, and develop it from there, leading into more complex and inclusive models. I think the way we learn physics is a useful analogy, we tend to learn classical physics first, which as a model is a good mathematical approxation to the way the universe works at certian scales under most conditions, and is understandale from the way we observe the world as we grow up. If we were to start learning quantum physics, of which classical physics is but a subset, we would never get anywhere, I mean most physicist would probably admit that at a 'commonsense' level they do not understand quantum physics. Maybe the dilemma could be resolved with a simple note, saying this is the commonly accepted neoclassical definition and other definitions which are more complex and inclusive of human activitiy are developed later under their own appropriate heading. While I think the religion/Jesus analogy is seductive I'm not convinced that its very useful. BobW67.103.183.204 23:05, 13 January 2006 (UTC)
I agree that is often what you will find opening a current textbook in most countries, but I think that says more about the current hegemony of neo-classical economics than about the nature of economics as such. -- Jmabel | Talk 05:05, 16 January 2006 (UTC)
The idea that individuals act to maximise utility is not and never has been solely associated with the neoclassical school of thought. Much of the mainstream of economics is, and has always been concerned with this concept and exploring its limitations. This can be demonstrated by reference to just about any undergraduate textbook. What's normally referred to as 'Neoclassicisim' refers to either (some) macroeconomic applications of this procedure, or to the more extreme micreconomic applications. I've edited a section of the article accordingly. The Land 16:43, 19 October 2005 (UTC)
I tend to agree, although it's almost impossible to agree on definition of "neoclassical economics" that will satisfy everyone (as an aside, many folks confuse "neoclassical" with "new-classical" - I know, I know, economists are not very creative when it comes to naming their schools). To me "neoclassical" tends to mean "the economic succesors of Alfred Marshall", or in other words supply AND demand (contra classicals who focused on supply and say, Austrians who focused on demand). Or to put it yet another way - from point of view of value theory - that value is determined by both a subjective component (individual preferences) and an objective one (underlying production technology and amounts of available factors of production). So personally I'd put in New-Keynsians (why aren't they even listed under Schools of thought? They have as much claim to be 'succesors to Keynes" as do Post-Keynsians (again, not very creative naming conventions) in the Neoclassical camp. Hence, it's not really true that "neo-classical economists tend to favor supply side interventions" - some do, some do not. And BTW Monetarism is concerned with the demand side.
Finally, the sentence "An outgrowth of neo-classical economics is rational expectations, which differs from neo-classical economics in that it does not see a micro-economic foundation for macro-economic behavior, and it emphasizes the strategies of rational economic actors in creating macro-effects" is nonsense. Rational expectations is the assumption, more or less, that in making predictions about the future people do not make systematic errors, only random ones. Micro-foundations is a seperate issue and this is just confusing things. In fact usually models with rational expectations DO try to be micro-foundations based which makes the above statement false.
This needs some fixin' up radek 21:47, 17 December 2005 (UTC)
If we're going to have "Alternatives" to "mainstream" economists and claim that "Socialist Economists" exist in academia, could we please have examples? If we can't have examples, could we not even list "alternatives". —The preceding unsigned comment was added by10lbs of potatoes (talk • contribs) 11 Nov 2005.
At one point I added a mention of post-autistic economics to the article, and it was promptly removed. -- Jmabel | Talk 18:47, 12 November 2005 (UTC)
It seems (and I need to spend time perusing the history of the article) either than few neoinstitutional, Keynesian and post-Keynesian, Marxist and post-Marxist, post-autistic, even post-modern scholars edit this article, or a neo-liberal, neo-conservative cabal is acting as a gatekeeper against any alternatives to the status quo model. From reading other articles, I would suspect the latter.--Imagine&Engage/Talk 11:57, 9 March 2006 (UTC)
Two "See Also" section
Why are there two See Also sections on this entry? Unless anyone has a good reason for that to be the case, I'll change it in a while. Odd bloke 04:11, 14 November 2005 (UTC)
Just do it. -- Jmabel | Talk 05:19, 14 November 2005 (UTC)
publication
would you like to publish this article? -- Zondor 22:16, 27 November 2005 (UTC)
Real Economy
Following changed to a redirect.
Real Economy can be defined as an economy taken in terms of the goods it produces or trades as opposed to money. E.g. If a country pays $60 for a barrel of oil the real trade has been that barrel of oil and the nominal has been the $60 traded.
I did not create this. WCFrancis 16:47, 5 December 2005 (UTC)
Welfare definition
I don't think the sentence "The welfare definition was still criticized as too narrowly materialistic. It ignores, for example, the non-material aspects of the services of a doctor or a dancer" is correct. There's nothing in Marshallian economics that says that only apples and oranges have value but not medical services or dance performances. They're all "goods". I don't know wherethe notion in the sentence comes from. Also, in general the description of the Welfare definition is pretty poor, since it doesn't even give the definition. I mean, at the very least utility and the concept of consumer surplus should be mentioned. radek
radek, here and above, some very good comments. I really encourage you to edit the article. -- Jmabel | Talk 02:36, 19 December 2005 (UTC)
these definitions arent the best...but it depends what school and or country you come from. I've learnt different variations to this and I will draft up a summary of edits. —The preceding unsigned comment was added byEco Nerd (talk • contribs) 24 Dec 2005.
Evolutionary economics
The remarks here on Evolutionary economics are almost incomprehensible; the article on the topic not much less so. In particular "Evolutionary economics often deals with the otherwise difficult questions related to the role of 'routines' and 'capabilities' in explaining heterogeneity in firm outcomes," is utterly jargon-laden. -- Jmabel | Talk 03:49, 13 January 2006 (UTC)
Yeah I had the same thought - in fact I thought the article was about Evolutionary Game Theory which is probably a lot more prevelant then what the article describes as Evolutionary Economics. For now, since I don't know much about this topic I'm gonna leave it alone though.radek
The value of an industry: Anti-vaccinationism
What is the annual € (Euro) value of the 30 + 300 main and subsidiary anti-vaccinationist websites' retail trade?
is a question I posed on the talk page for Anti-vaccinationists. Any help would be appreciated. Midgley 19:35, 10 February 2006 (UTC)
oikos and nomos
I will add the proper translations of oikos (family, household, estate) and nomos (custom, law) so that it is clearer that both political economy (management of the state) and scarcity (macro and micro) are covered.
for nomos, see http://www.bible-researcher.com/hebraisms.html: "One example is the Greek word nomos, which is usually translated "law." In Greek the basic meaning of nomos is "custom" or "convention," for the Greeks held that law was simply codified custom."
for oikos, see http://www.oup.co.uk/isbn/0-19-815025-3: "The Oeconomicus is unique in Greek literature in combining a discussion of the proper management of an oikos (`family', `household', or `estate') and didactic material on agriculture within a Socratic dialogue."
Please note that there is a version available in Project Gutenberg, so that digital copying is allowed as long as the PG reference exists, while one is referred to the publisher for printed versions.
I think there's a good case for adopting the JEL classification system [5] to define categories in economics. I'm not sure, though, how to implement this, or even how to go about getting some sort of consensus. Any ideas? JQ 09:47, 17 March 2006 (UTC)
Is the JEL system public domain, or might we have an intellectual property issue here? I ask because, for example, the Dewey Decimal system is not in the public domain. - Jmabel | Talk 01:17, 24 March 2006 (UTC)
A good question. I'll see what I can find out JQ 02:29, 24 March 2006 (UTC)
Update. I have received permission to use the JEL classifications, with attribution, which I think makes sense in any case. Does anyone have any concerns about this.? JQ 20:42, 31 March 2006 (UTC)
Bewildering introduction
Economics is said to be normative when it recommends one choice over another, or when a subjective value judgment is made. Conversely, economics is said to be positive when it tries objectively to predict and explain consequences of choices, given a set of assumptions such as observations or policy objectives. The choice of which assumptions to make in building a model as well as which observations to highlight is, however, normative.
I have real trouble understanding this. I'm going to generalise wildly and say most readers won't be able to make any sense of this either. Can we dumb this down a little? After all, this is the introduction section to a very broad & high level topic. WhiteCat 10:37, 26 March 2006 (UTC)
I think it is fine if you want to dumb this down. My main concern with the introduction is every few months someone who has only studies neoclassical economics comes in and rewrites the introduction as if they were rewriting the neoclassical economics page rather than the economics page. This is something to be avoided. Ruy Lopez 04:32, 31 March 2006 (UTC)
to objectively
Conversely, economics is said to be positive when it tries objectively to predict
Conversely, economics is said to be positive when it tries to objectively predict
The second one sounds better to me. --Gbleem 13:16, 1 April 2006 (UTC)
What about; Conversely, economics is said to be positive when it tries to predict objectively. -- ∞Dbroadwell 07:31, 30 April 2006 (UTC)
new addition
There is a constant creep in the introduction pushing neoclassical ideas. A recent addition the the third paragraph talks about scarcity and value based on price, and then refers to other theories as socialist. Actually, Adam Smith, David Ricardo, and virtually all major economists up until the second half of the 19th century did not hold to this theory. All of this is fine to put into neoclassical economics but this is an article about economics, not neoclassical economics. I'm sure most people of the people adding this to the top have no idea that Adam Smith etc. did not believe the stuff they are putting up there and their narrow theory does not apply to economics in general. Ruy Lopez 06:38, 16 April 2006 (UTC)
That section was clearly describing neoclassical economics. The sentence began "Critical assumptions of this paradigm...". One could perhaps object that (a) neoclassical economics is not the mainstream modern paradigm, or that (b) these are not in fact critical assumptions of neoclassical economics. Either of those objections, while silly, would at least be plausible. However, your objection makes no sense as the paragraph does not claim that theory to represent economics in general, or the beliefs of Smith or Ricardo. It quite explicitly represents the modern mainstream view. Do you object to that characterization?
My comments above say "this is an article about economics, not neoclassical economics" and that some people are "adding this to the top" of this article about "economics in general". If the paragraph does not represent economics in general, as you say, then what is it doing at the top of the economics page? My first urge is to push these paragraphs down the page, my second one is to give as much space to the original theory that neo-classical economics is a counter-theory of. I dislike the explanation of alternate theories at top, perhaps I'll change it soon.
I'm also unclear why you feel that it is incorrect to say that economic logic is not applied to problems involving choice under scarcity. What is objectionable about that statement? Christopher Parham(talk) 19:02, 16 April 2006 (UTC)
The statement you made is objectionable because it is missing a word. "Economic logic is applied to problems involving choice under scarcity" is objectionable. "*Neoclassical* economic logic is applied to problems involving choice under scarcity" is not objectionable.
Anyhow, at least in the current version of the article neoclassical theories are labeled as such and people are informed that not all hold these theories (at least in the introduction anyway). Which is way ahead of previous versions of this article. Ruy Lopez 02:44, 30 May 2006 (UTC)
Actually a more accurate statement would be that pretty much all economics except those based on labor theory of value deal with scarcity. The Austrians are definetly not neoclassical (whatever that is) and their theories are based on the idea of scarcity. Same for heterodox approaches to general equilibrium. The institutionalists sort of pick and choose.radek 03:21, 30 May 2006 (UTC)
Actually a more accurate statement would be that pretty much all economics except those based on labor theory of value deal with scarcity - considering that Adam Smith, David Ricardo and the political economy of "pretty much all" economists up until the era of the Paris Commune and the like was based on the labor theory of value, this is a pretty big exception. In the 1870's, the theory that value did not arise from labor developed, creating a tangent of economic thought off of the original one. I know this tangent is popular among professors at US universities like the University of Chicago, but that means about as much as what bishops in the Vatican think about theology. It makes it notable, but not divine law, despite what they and their followers would possibly prefer. I am not the one veering off course from the political economy of Adam Smith and "pretty much all" economists prior to 1870, that would be the marginalists. Ruy Lopez 04:49, 2 June 2006 (UTC)
After Tax Analysis
Where does after tax analysis, an engineering economic method, fit in the the tree of economic articles? searches are drawing blanks ... if i have to create, where should it go? -- ∞Dbroadwell 07:13, 30 April 2006 (UTC)
I would put this in as a section of Valuation (finance)JQ 08:04, 30 April 2006 (UTC)
It can be more than just strict value, Present worth, Future worth, and Annual worth can all be considered within after tax analysis ... Does Valuation (finance) still seen the best fit? -- ∞Dbroadwell 08:17, 30 April 2006 (UTC)
All of these are, or should be, considered in valuation. They are covered in Valuation_using_discounted_cash_flows, though the article needs some work. Tax is just one factor that should be taken into account. JQ 10:38, 30 April 2006 (UTC)
Oh well, as a student in this area, I don't know enough to refactor the economic analysis docs. I count myself lucky that i was able to improve depreciation and MACRS with data from the IRS, (worked for Jackson Hewitt for a few years). -- ∞Dbroadwell 03:45, 1 May 2006 (UTC)
Good work....it looks very helpful. Kudos on finding a single scheme to employ as that will be very helpful in preserving a good category structure. Christopher Parham(talk) 16:40, 30 April 2006 (UTC)
The criticism section
I would contend that the criticism section should not contain criticism of specific economic theories, mostly because these are not in fact criticisms of economics. They only make sense in the context of the specific theory to which they are directed. For instance, at the moment the article includes a critique of Pareto efficiency. But the article doesn't explain what pareto efficiency is, so anyone reading this (who presumably knows very little about the subject) is likely to be quite confused by this. Some theories are discussed in the article, and criticism about them should be included right there with the presentation of the theory. Christopher Parham(talk) 19:19, 14 May 2006 (UTC)
Not to mention the fact that things like the 'lump of labor fallacy' is NOT a fallacy economists often make, rather it is an idea which is revealed to be a fallacy by applying economic reasoning. Hence it is not a criticism of economics. I deleted the 'examples' section. They were just goofy.radek 01:30, 16 May 2006 (UTC)
Would someone care to clean up Pat Devine and his socialist economics? Simesa 01:09, 16 May 2006 (UTC)
Fallacies etc...
M&Ms says; How is this a fallacy?
One criticism of relying solely on the criterion of Pareto efficiency is that it tends to support the status quo, since it is often difficult to find practical examples of changes in a society that do not harm at least one person. Still, if an economic system is to be devised, it is preferable that it result in outcomes that are Pareto efficient.
Firstly economists are not dependent on this criterion. It is reconised as an ideal. What is important is that economist or who ever creates policy tries to create "more pareto efficient moves". Basically economist realise that sometimes the person who has to make a decision and is caught between a rock and a hard. When this happens economist refer to a cost-benefit analysis which in keeping with pareto efficeincy they will try to make a decision on the best "possible" outcome.
It should be removed from the article as a fallacy or an attempt should be made to state that while decision makers do not have the option of making a 100% pareto efficeint move then they choose the next best "possible" option in accordance with the principal of efficeincy.
It's not. Whoever wrote that has no idea of what they're talking about. I deleted the 'examples' as they're all pretty bad.radek 23:05, 16 May 2006 (UTC)
"Why is it Goofy?"
Taking them in turn:
Pareto efficiency - this isn't a fallacy. You might not like the concept but it's not a fallacy. See logical fallacy
Marginalism - again not a fallacy. First part of the criticism was okay though. Second sentence didn't make any sense.
Lump of labour - yes this is a fallacy. But it's not a fallacy committed by economics or economists. It's a fallacy which results from LACK of knowledge of economics. See my comment above.
Behavioral economics - It' still economics. Explores a particular area but it's still economics. It doesn't imply that non behavioral economics is a fallacy. Just tweaks some of the assumptions. Even then, Kahnemman himself said that 'mainstream economics applies in 90% of the situations. Behavioral economics is about the 10% when it doesn't.
You want a criticism section, fine. But it's got to be much better than the crap that is there now.
It doesn't need to be a fallacy, the section is wider than that. Everything here is economics. I provided the references you are claiming and I hope you read some before restart your blind (and, in my opinion, silly) reversion war. Page Up 00:32, 17 May 2006 (UTC)
A survey of economists on certain beliefs is used to support the claim that "many economics subfields and concepts aren't immune to recurrent and well-known contradictions and fallacies"? This is absurd. Your additions are being reverted because they are not well-considered enough to belong in the umbrella article for this field. Christopher Parham(talk) 01:05, 17 May 2006 (UTC)
No, I think it's because you and your friend don't want the section in this article. Page Up 12:48, 17 May 2006 (UTC)
Um, as I said right above, I think the changes are not well-considered. Obviously I don't want them in the article.... Christopher Parham(talk) 17:04, 17 May 2006 (UTC)
I rewrote the section and deleted a small portion of it (particularly the lump of labor fallacy, which does not belong here at all). I'm fine with pointing out that there are disagreements and various theories and much internal as well as external criticism. But seriously Page, the part was just badly written and confusing, and well, wrong both by implication and outright. radek 02:48, 21 May 2006 (UTC)
Economics "science of thinking" quote
I have removed:
John Maynard Keynes once remarked that "Economics is the science of thinking."
Feel free to object. --A Sunshade Lust 05:35, 30 May 2006 (UTC)
definition of the science of economics
Just a question. Is not the science more about the movement of money, either world wide or within a particular area? Of course there may well be many different approaches and economic phylosophies, but I suggest these are simply different ways of looking at the subject rather than the subject itself. —The preceding unsigned comment was added by Lleighton (talk • contribs) 30 May 2006.
calling all economist LOST fans - who are also good at editing/condensing!
hi! I'm an editor on LostPedia, a Lost (TV series)-related wiki (and recently, an editor on wiki as well. this stuff is addictive!). i'm working on an economics article(IANAEconomist) over there with someone who is an economist; i'm acting more in the editing capacity, whilst the other user is supplying the facts, essentially. i'd really love some other wikipedians who are versed in this area (who are also good editors) to have a look at the article in question! my aim is to make the article a lot more understandable to people unfamiliar with economics as a science. it has the potential to be a truly excellent article if it can be distilled a bit more. your input is appreciated! --Kaini 04:07, 5 July 2006 (UTC)
Confusing sentence
"The accounting measures usually used measure the pay received for work and the price paid for goods, and do not deal with the economic activities of those not significantly involved in buying and selling (for example, retired people, beggars, peasants)."
This could be a lot clearer, I think.--142.227.45.20 03:09, 8 July 2006 (UTC)
Overall Viewpoint
This article has really degenerated in quality over the last 6 months. As it stands now it is difficult to read, makes incorrect statements and does not adequately represent or even discuss well what "economics" is. As the artcile stands today, it is indicative of some of the problems that Wikipedia faces is producing output that is of high quality. I am, of couse, not the first nor the last to make these observations.
== I have to agree with the above - this article is also full of jargon. Can someone with a better understanding of economics please pull out the salient points and somehow move the rest into sub articles or whatever. For soemone who had no understanding of the topic at all, though I have some myself, this reads like anally retentive l337 sp33k.
Drivel
Please excuse the intrusion, but how about just reverting the article to a past version with all of the drivel removed.. Seems like a good idea to me. —The preceding unsigned comment was added by 217.17.118.55 (talk • contribs) 8 July 2006.
error?
Unlike natural scientists and in a way similar to what happen in other social sciences, economists are generally unable to test their theories due to its impracticality. Unlike the natural sciences, economics yields no natural laws or universal constants, so this has led some critics to argue that economics is not a science, or at best, is just a soft science. This is plain false. The Austrian School deduces the whole economics from just some axioms and empirical notions, these are nothing but universal constants for the world one lives in. Intangible 06:04, 15 July 2006 (UTC)
Alleged flaws and criticisms section
"Economics has been persistently criticized for its heavy reliance on unrealistic, unobservable, or unverifiable assumptions. Some people reply to this criticism by saying that the unrealistic assumptions of economics result from abstraction from unimportant details, and abstraction is necessary for knowledge of a complex real world. So, far from unrealistic assumptions detracting from the epistemic worth of economics, such assumptions are essential for economic knowledge. Denominating this explanation the abstractionist defence, and after clarifying abstraction, unrealistic assumptions and kindred notions, some studies have shown that this abstractionist defence does not successfully rebut the position of those who criticize economics for its unrealistic assumptions."
I have a lot of problems with the quoted material. First, it is copied nearly word for word from its source (although the source is cited). Second, most of the changes made to the text are to reword from first to third person. Examples; "I call this line of argument 'the Abstractionist Defense'." has been changed to "Denominating this explanation the abstractionist defence", making it seem as though the 'abstractionist defense' is a regularly used term. Also, "I show that the Abstractionist Defense does not successfully rebut the position" has been changed to "some studies have shown that this abstractionist defence does not successfully rebut". Making it appear as though there are multiple studies proving this, rather than just one person arguing it. Third, this is the abstract of one paper. Simple because one paper criticizes something does not justify it being included in an encyclopedia article. For these reasons I am removing the text from the article. William conway bcc 17:33, 14 August 2006 (UTC)
Cut, needs rewrite
The following paragraph was poorly written and lacks citation. I am sure something like this belongs in the article; it should have citation. I would have copy edited it myself it I'd been sure of what it meant to say. And, yes, it began with a lowercase letter.
in modern times, alternative measures have been development to measure the welfare of a nation, flaws have been seen in modern toolds such as Gross domestic product, the index of social economic welfare (IESW) is published by the UN and show economic welfare more accurate as it factors in enviromental costs, it subtracts the cost to remove negatives to show how a society grows rather than measure GDP which is simply an measurement of all transactions.
I would even try to pick apart the syntax and grammar; I think there are supposed to be several sentences here. I'm guessing "have been development" ==> "have been developed", "toolds" might be "tools" (but that's not a very apt word, either). Someone want to take a shot at rewriting this in actual English? - Jmabel | Talk 06:40, 23 August 2006 (UTC)
CSTAR 02:45, 19 Jul 2004 (UTC)
