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Why would protecting domestic assets necessarily be bad? I don't think a country should allow the strip mining of its assets and the impoverishment of its population by capitulating unconditionally to 'market forces'. If not protectionism, what other weapon do we have against 'unfair competition' from areas with lower production costs due to their failure to implement to proper environmental and labour regulation? Do we really want to participate in a race to the bottom?
by someone (s0me1smail(a)gmail(d)com) on Tue Jan 13th, 2009 at 04:03:27 AM EST
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You'll get no argument from me.  I've always opposed sacrificing at the altar of efficiency, especially since efficiency and the rules creating it always seem to favor the haves over the have nots, a bit of reality the Austrians/Chicagoans studiously gloss.
by rifek on Tue Jan 13th, 2009 at 10:05:55 AM EST
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The further bit of slight-of-hand in the efficiency argument is that rarely is it declared what it is the efficiency of. I.e. which parameter is being optimized? Efficiency on its own can hardly be considered an unquestionable good. After all, the Nazis where quite efficient with their gas chambers, optimising the number of people killed per unit time.
by someone (s0me1smail(a)gmail(d)com) on Tue Jan 13th, 2009 at 11:06:30 AM EST
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... of efficiency, its sacrificing to a false idol of efficiency ... a partial, static, efficiency, ignoring externalized costs and ignoring dynamic efficiency gains.

Following the static efficiency argument, Japan would never have invested in steel making and shipbuilding after the end of WWII, but if they had not, they would have sacrificed dynamic efficiency gains far in excess of the static efficiency gains that they did sacrifice, so in terms of "efficiency", what was claimed by most of their US advisers to be the inefficient choice (Deming gets an honourable mention here, he just wanted to make efficiently whatever it was decided should be made) turned out to be the efficient one.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Tue Jan 13th, 2009 at 05:48:03 PM EST
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And we see yet another reason not to confuse science with social studies.  There is scientific efficiency, which is a useful and quantifiable measure of an element of the operation of a physical system, and there is economic efficiency, which typically is a faux-scientific political construct arbitrarily defined by those with the power to do so.
by rifek on Tue Jan 13th, 2009 at 08:31:34 PM EST
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Economic efficiency is both easy to define and identify in a clear, unambiguous way and easy to use to generate simple, formal, tractable models.

Its just that the term economic efficiency in the former and the latter mean different things. The problem is that once you go to the trouble of actually specifying your economic terms in ways that can be clearly and unambiguously identified, you can no longer hide from the fact that any simple, formal, tractable model of economic development is intrinsically and radically incomplete.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Tue Jan 13th, 2009 at 10:15:39 PM EST
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And the model, to be manageable, must be simplified to a point far beyond mere Goedelian incompleteness and on to a point where the model becomes irrelevant and even nonsensical.  There are simply too many vectors that can barely be identified, let alone measured or controlled for.  Such exercises do show us, though, in stark fashion the firmness of the foundations of Logical Positivism and its "informed actor" and his "enlightened self-interest."
by rifek on Tue Jan 13th, 2009 at 11:23:23 PM EST
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... remarkable similarity between the supposedly Universal Homo Economicus and the particular habits of thought of upper middle class English merchants of the 1800's.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
by BruceMcF (agila61 at netscape dot net) on Wed Jan 14th, 2009 at 12:55:38 AM EST
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And J K Galbraith makes the same point in the New Industrial State when he mocks (the then young) Milton Friedman and his ilk as hopeless romantic throwbacks to the petty merchant and manufacturer economy of the time of Adam Smith.

I suppose Miltie had the last laugh over Galbraith, unfortunately for all of us.

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith

by Carrie (migeru at eurotrib dot com) on Wed Jan 14th, 2009 at 04:11:55 AM EST
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He had a laugh over John Kenneth, but not, it may be be, the last one.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
by BruceMcF (agila61 at netscape dot net) on Wed Jan 14th, 2009 at 06:53:41 AM EST
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Well, they're both dead now.

Most economists teach a theoretical framework that has been shown to be fundamentally useless. -- James K. Galbraith
by Carrie (migeru at eurotrib dot com) on Wed Jan 14th, 2009 at 06:54:46 AM EST
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But madmen in power listening to voices in the wind are as often as not listening to the voice of a long dead economist.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
by BruceMcF (agila61 at netscape dot net) on Wed Jan 14th, 2009 at 01:38:54 PM EST
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We're still around to laugh, although rather bitterly...

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Wed Jan 14th, 2009 at 04:02:21 PM EST
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