/lit/ - Literature

>The other will give away the name of my country hence will remain unannounced.
lolwut

i've been wanting to get into some Economics lately. Reading material suggestions?

Thinkin about startin with Adam Smith or John Maynard Keynes. Also advice on investing on the stock market please!

>>1497798
Yes. There are subjects like "economic development of XXXXX" in certain nations.

>>1497800

I would avice you (obviously) Wealth of Nations. The reason is this: It is the first and the most fundamental piece of work done on Economics. I would strongly recommend works of Friedman AFTER reading Adam Smith. Friedman is an extraordinary author and tends make people very easily convinced with what he says. These are good beginning texts for people.

>Stock market:

I am sorry if I refrain from giving any advice in that sector. I am NOT from the US. So it would be wrong for me to comment on particulars.

Also, what level of Mathematics would you need to be a decent Economist? I would imagine around a higher knowledge of Statistics and Probabilty, etc?

>>1497817
Basic level calculus (Derivatives and Basic integration), VERY good understanding statistics, some amount of algebra should be more than enough.

>>1497820
What about dem 'metrics?

You also need linear algebra and matrices. And an understanding of numerical methods.

>>1497821
Not beyond Inverses. That is hardly high school level.

I would be happy if I could answer your questions /lit/. Please ask!

bump

Well economics appears to be quite uninteresting!

Where do you see the world economy going from here? Is this a downward spiral to oblivion, or a standard recession that will pass?

>pic related lol

>>1497846
Don't know what kind of Masters you did, but I really find that surprising.

>Master's in Economics
MBA or MS?

>>1497814
It was more of a wut because you don't want anybody to know what country you're from.

>>1497994
....

The honest truth is its difficult to predict. I will explain:

Initially trade cycles affected closed economic zones like nations or unions of nations (EU). Now due to free markets implemented throughout the developing and developed nations of the world its almost a single economic zone. Production of the world getting concentrated to one of its parts (China) is quite dangerous, as its failure would plunge the ENTIRE world economy into recession. And there is a very good chance that it will happen in out lifetime and perhaps within next 15 years.

>>1498007
>>1498002
Strangely even my degree will tell you where I am from. I am M.Sc. in economics. Now this should actually tell you where I come from. with some error.

Why so starvation?

>>1498016
Wikipedia is giving me Germany or India.
But, you could have just said M.S. It's the same thing.

>>1498002
Its true that you don't have to understand the ideas that come from advanced Linear algebra. The true reason if you have learnt Linear Algebra from lets say books like Halmos, would be that all spaces in economics are REAL vector spaces. That should curtail your suspicion of my ability.

Rest of complexity in Econometrics is pure computational implementation of this 'simple' linear algebra

>>1498023
Technically it is not. M.S. in US means 12+6 years of education. In my country its 12+5.

>India or Germany

Neither.

>>1498018
I do not have the documented proof to show you, but starvation or below poverty line numbers (these are slightly unrelated but indicators of poverty) are decreasing since 1850. They decrease every year.

The question I believe you want to ask is why are they still here. Am I right? If yes, then I will try to answer it to the best of my knowledge.

>>1498029

More than half the people in the entire world is suffering in poverty, and there are far more people in the world than there ever has been to boot.

What do you think can or should be learned from the economic crisis?

>>1498024
Okay, cool.

What do you think of Georgism, and the problem of increasing access to services/resources and standards of living also increasing land value?

>>1498029
Why don't you want to tell us where you're from? It would give credibility to what you say and we would be able to better grasp what it is you are saying if we know what kind of economic system is present in your country. We would be able to see if you might be biased toward something etc. It would only serve to help you convince us that you know what you're talking about and from what perspective.

What's your position on income inequality and wealth redistribution? I've seen a couple arguments claiming that lower levels of income inequality are associated with a lot of positive social effects, but I'm interested in what the economic angle would look like.

Ron Paul

>>1498033
This is indeed a misleading statement.

First population growth rate is DECREASING (check it out).

Secondly, you mention half the world population. That population is Concentrated in underdeveloped countries for which data was unavailable before the 19th century. Hence the sudden addition of their numbers to the below poverty line data gives us an incongruous understanding of progress of development.

I will try and see if I can get some numbers for you from some trustworthy source.

Secondly, the

What fiction have you read that you felt handled economics well?

>>1498035
That economic crises are inevitable results of trade cycles and policies of corporations should be transparent to their stock holders:

The financial concerns of the world in the crises acted extremely erratically, trying to garner short term profits without understanding the long term effects of their methods. Their methods, were highly questionable and justified by this principle: 'we will loan against invisible assets and hope they will provide high returns'. No need to say that this failed.

People should be more aware how the large corporations decide their policies. This way they can more effectively decide where to invest their money. Trust, is the MOST POWERFUL weapon in the hands of a normal blue collar man. Believe it or not, more than 50% of the stakes in large corporations ALL OVER THE WORLD is owned by individuals like you and me. They have a right to know what goes around with their money.

How do you feel about this book?

>>1498054
Thoughts on the Swedish economic model? Viable or socialism?

>>1498036
>flat tax:

Right. It bad. It won't work for the following reason. Flat tax (I assume you obviously mean income tax) leads catastrophic results when you compare the absolute standards of living.

John earns $ 1000 and Jack earns $10000 per year.

The flat tax is 10%. The money spent on vegetables yearly is say $ 200. John just lost half that money and is left with actual credit of $900.

John on the other hand lost $ 1000, but is left with $ 9000. His spending on vegetables then can be considerably high increasing dearness for either thus crippling John's living standards.

This is a simple argument considering only 'natural inflation'. There are more complex ones which also oppose flat tax. Tax should be progressive but below the 50% mark.

>real estate and 'land value'
No matter what, they are bound to increase everywhere across the world. Even in US as soon as they come out of their recession. Reason's are obvious, Urbanization.

>>1498062
Are there any solutions to the cost of living increasing wrt wages though?

>>1498064
>>1498062
It's also not a flat tax, but a single tax; he argues we only need to tax landowners, and that in turn would work as a tax for everything else, or at least most of everything else.

>>1498044
No comments. I am not from US.

>>1498039

>>1498043
>income inequality
I would like to know where you learn that it leads to positive social effects. Although income inequality does in SMALL way reduces inflation, it is traditionally agreed by economists to be the driving force behind growth, especially in the recent years. Read the "Fortune at the bottom of the pyramid". Its states how largest amount of money is made by people who utilize the low/mid income group classes that classically make up about 85% of populations in the developing/developed countries int he world and contribute maximally to the GDP (PPP and REAL) to actually help the poor people.

>wealth distribution

I will be honest with you. Wealth CAN NOT be distributed per se. It flows. The government sometimes creates artificial or natural monopolies (which is WRONG) that leads to sudden drainage of wealth from one sector of population. But otherwise wealth finds it way itself. BTW where ever govt.s pass laws to support certain kind of establishments (US -> Ammunitions and weapons) that is also an indirect help to carteling and monopolies.

If you are talking of huge paychecks to corporate CEOs and consultants I support your claim. But please be reminded these huge salaries are insignificant portions of the economy and are morally wrong but may lead to long term harm to economies.

>>1498052
Tragically none. Except perhaps Foundation trilogy.

>>1498069
Sorry my mistake. I was relying on memory and did not check. Fine.

>taxing only the land owners
Would cripple govt. services. Largest sources of tax today are service and sales tax.

>>1498055
Very pertinent to its time period when exploitation of the working class in the industrial age was horrific. Today it has become almost irrelevant if you ask of me. Marx's theory of labour value (one of the many labour value theories) are not truly viable and have been shown to be quite impractical.

If you ask my honest opinion, I, like most other modern economists would support a mildly regulated, market economy with welfare for old, homeless and disabled with government subsidies for bright students in higher education and free primary and secondary education (pre-graduation).

>>1498086

What about his labor theory of value don't you like?

>>1498059
>Swedish model
No comments. Its a highly confusing economy. The only reason its so insensitive to global crises seems to be its self-reliance.

>Socialist or not
Well... if you take the HARD definition, no. Its a market economy. Is it socialist leaning? Perhaps. But the govt. is slowly easing the control over the public sector.

Unions does not mean socialism. Forming a union to demand wages is a fundamental right of the worker by any standard.

>>1498064

>>1498064
>Cost of living and wages

No direct relation I am afraid. The only correct way is technological/exploratory advance. Higher wages = Higher inflation

>>1498097
I knew that I would have to answer this question.
One simple answer is:

Means of production are no longer localized to a few individuals. All of us have direct or indirect stakes in them, in a market economy.

>>1497794
>He prompted me to learn Mathematics so that complete what he always wanted to do: checking whether Econometrics is a valid science or not.

lolwut? What the heck is valid science? And "checking"? What the heck does that even mean? Can you provide more details? Do you have papers published in peer-reviewed journals?

>>1497814

Awful advice. The Wealth of the Nations is a long and boring book for the inexperienced reader. I'm not sure how much it contributes to the understanding of today's economics considering how vastly different things are. It'd be like someone wanting to read something about natural sciences and starting with Newton instead of Sagan, Bryson or Feynman.

If you want an introductory textbook, Greg Mankiw's Principle of Economic's is the best choice available.

If you want just a book to start reading about economics, it doesn't make sense to start with a historic curiosity like Adam Smith or some heavy and meaty stuff. There are plenty of good economic books, very sound from an academic perspective, which are enjoyable to the generic reader.

Let me recommend a handful of them:

The Company of Strangers: A Natural History of Economic Life - Paul Seabright (this is a book of what can be called bioeconomics. I don't care much about labels though; it's an absolutely brilliant text).

The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor - David Landes

Discover Your Inner Economist: Use Incentives to Fall in Love, Survive Your Next Meeting, and Motivate Your Dentist - Tyler Cowen (absolutely brilliant book).

The Price of Everything: A Parable of Possibility and Prosperity - Russell Roberts

Freakanomics - if you haven't read it, don't let the popularity of the book make you believe it's not "serious" or "sound" enough.

Discover Your Inner Economist: Use Incentives to Fall in Love, Survive Your Next Meeting, and Motivate Your Dentist - Tyler Cowen (absolutely brilliant book).

Nice thread, OP.
Do you have any opinions on the current US economy in regards to what improvements should be made?

>>1498101
You don't think unions hold a lot of blame for capital flight to countries like China?

Would you consider the Swedish model to be viable for, say, the entirety of Europe?

Also, what are your thoughts on (I'm not sure what the correct term is) citizens' salary.

I don't suppose you happen to have an opinion on Baudrillard?

>>1498109
> I'm not sure how much it contributes to the understanding of today's economics
The fundamentals, pretty much. Also, it's not written anything like other econ books; reading it never gets less hard.

I think Friedman is an abysmal author though. His basic assumptions are at best flawed and naive. Hayek at least has a bit more meat to him if you want want that sort of thing.

>>1498074
Did you think Foundation was good then?

>>1498109
>lolwut

It is quite easy to argue actually that economics is not a pure science. Econometric analysis is highly dependent upon the model it uses to predict the outcomes of that model. In that aspect it is a HARD science way of looking at Economics. I actually agree that it is a useful way to play around with numbers. But I would not argue that national policy be decided according to its projections.

My father was always very skeptical of people claiming that they could 'predict' any results based on historic data (statistical) or use their axioms to build models and use microeconomics to get numbers. I am not glad to say that now I share his skepticism.

>>1498112
This is assuming that something can actually be done.

But cut spending. Its a generic advice everyone gives. Its a good one.

Neoliberalism.

Neoliberalism all up in this thread,

>>1498062
>Flat tax

You really don't sound as an economist at all.

What "needs" to be progressive is the fiscal system at large, not the taxation system. There's no problem from that perspective. The issue is about efficiency, not really about "redistribution". A flat tax with a system of subsidies works just as a progressive system.

More importantly, who the heck proposes a flat tax on income? Most defenders of the flat tax (and I'm not one, but for entirely different reasons) propose the incidence to be on consumption (basically a retails sales tax).

There's plenty of scientific literature on this.

OP, would you consider Obama's efforts to push through a major and expensive healthcare reform in the current financial state to be folly? It seems to me that he picked a helluva bad time to try something that ambitious. I'm not judging it whether free healthcare is right or wrong, but rather if it is responsible to attempt it whilst having a record deficit amongst other things. Might it not just break the US?

>>1498125
Pretty much. Inb4 Ayn Rand institute.

>>1498121

Yeah, I have no idea about who your father is, but hundreds, thousands of papers were already published about that issue.

I mean, have you heard about the Austrian School of Economics, for example?

>>1498046
>I will try and see if I can get some numbers for you from some trustworthy source.

Oh please.

Just check Hans Rosling youtube videos. They're the best lesson out there about the effects of the globalization in world poverty.

>>1498134
FUCK VON MISES WITH A RAKE.

>>1498113
>capital flight, china, unions

Tragically union stubborn-ness (assuming there is such a thing in USA. You see I haven't got data about USA). will not be the bog problem when compared to China. China is literally using slave labour to attract foreign investment. No one can compete with that.

>citizen's wage
There is no such thing. Perhaps you can explain in detail.

>swedish model ->Europe

Europe is almost applying it, except for large stakes of govt. in industry. Only that even Sweden is slowly reducing its stakes in its public sector.

>>1498114
I had to google his name. So I dare say I don't know anything.

>>1498117
Ok. Which original arguments he makes, do you think that are today relevant? Please understand that I am NOT denying his social relevance! He did bring a revolution in the field of labour right no matter who says what.

>>1498134
>hundreds of thousands

Quite agreeing.Its our family project to just see it all by ourselves. Nothing to be concerned angered about I say.

>>1498118

I liked it. But that does not make a supporter of planned economy.

>>1498129
>Flat tax with subsidies.
Is not AT ALL like progressive tax. Subsidies are given on goods. This would mean that you will have to restrict consumption or reserve it.

A question of minor interest yet a curiosity that I propose to you, OP, is whether you might, like many other eminent financial theorists, subscribe yourself to the Judaic faith? Not to put too fine a point to it, and not to beat about the bush, but, are you, a follower (whether active or not) of the Talmudic teachings?

>>1498117

I disagree abut the fundamentals. It's very hard to understand the fundamentals about today's economic science by reading The Wealth of Nations. Just too difficult to extricate. Plus, you miss the entire marginal revolution.

Again, you're better served by reading a good textbook, it's not even close.

>I think Friedman is an abysmal author though. His basic assumptions are at best flawed and naive.

What the heck? Which basic assumptions are at best flawed and naive?

Friedman basic assumptions are basically equal to Adam Smith's.

>>1498132
What has her got to do with this all????

>>1498125
>neo-liberalism
Believe it or not, Market economy is becoming world favorite for a reason.

>>1498145
Hayek is awesome in how changes in economy can be a communication tool. Also, coming from a socialist perspective, but arguing for market control away from government, which is differentiated from both Von Mises and Friedman.

>>1498145
With citizens' wage I meant what is also referred to as "basic income".

>>1498172
>a reason
>does not, will not, can not elaborate
It's also being criticized atm for "a reason"

>>1498167
no.

>>1498131

My entire knowledge about Obama's policies comes from reading popular economics magazines (I consider Economist to be pop).

So yes. Spending that does not trigger production in a recession IS a bit deleterious.

>>1498162
>Is not AT ALL like progressive tax. Subsidies are given on goods. This would mean that you will have to restrict consumption or reserve it.

Yeah, I'm an economist. You aren't. At best you're an undergrad student or something. I thought this the moment you advised someone The Wealth of Nations as a good introductory reading to economics and the fantasy about your father making some sort of ground-breaking science about the scientific status of econometrics (actually doing stuff which has been done more than 100 years ago).

Subsidies are given on goods? What about unemployment subsidy? Or thousands of others?

(studying politics, philosophy and economics)

On the subject of the British government's manipulation of the British economy through austerity measures supposedly designed to reduce the deficit, and loosely, do you believe the measures will have their intended effect, of reducing the deficit. If so, to what extent would you say the deficit reduction would translate into actual economic benefit and to what cost, if any, to the quality of public services.

I've had a lot of opinions thrown around on this subject and, generally speaking, I have my own quite firm opinion, and I don't imagine even as someone learned you have an in-depth knowledge of every pressing economic issue. But, it would be nice to garner another perspective on the subject.

>>1498187
That's not totally fair; he may not be a good economist.

I'm thinking about getting a subscription to "The Economist"

Is it worth it? What are your thoughts on the magazine-- I mean, newspaper?

>>1498185
oh. I thought that the statistical evidence was automatically supportive to my argument but I guess, Correlation does not imply causation.

Market economy is much more stable, reliable and self-adjusting system. Amongst other things that we have tried in human history it seems to give maximum social benefit in terms of taxable revenue and economic freedom. What else would you want?

Please know that I am very much willing to listen to your criticism of market economy.

>This would mean that you will have to restrict consumption or reserve it.

Plus, I'm not really sure what this means, but if you had actually read classic economists like Smith, you'd know that "every taxation falls upon consumption".

The reason why most economists favor taxes on consumption and not on income is to not discourage savings (both of them discourage work).

This is taught in econ 101, btw.

>>1498199
>>1498186

Hmmm. Interesting coincidence.

>>1498187
>Unemployment subsidy
Kindly elaborate how it is related to the argument we are having.

>>1498192
PPE? Oxford man?

How do I understand the fucking resource market? Shit's confusing me!

>>1498201
Why are you not giving arguments like increased ability to choose (mine and your ideas of worth/value may be different), corruption due to authority, inefficiencies in having allocation controlled...?

>>1498192
You are going to hate me for this, but I believe that welfare should be reduced to battle depressions/ recessions. Should education subsidies be reduced/revoked? I really don't have a concrete opinion on that. Sorry.

Is capitalism the only largely employed economic system that isn't purely utopian?

if not, are there any better?

>>1498222
By using some case studies. Choose one most relevant to your locality. it helps to actually associate with it. Its actually not so difficult.

>>1498226
>ability to choose, less govt. interference etc
In my lexicon that comes under economic freedom

>>1498217
Am I allowed to be proud because I'm from a working class background as well?
>>1498229
Fair enough, but we've scrapped 4 billion pound spy plane projects, 80m of coastguard funding, losing 140,000 local council jobs and we're selling/leasing 20% of state owned forest. The suggestions are that we're jettisoning long-term investments to a greater degree than jettisoning long-term costs.

If you were interested, this (http://www.guardian.co.uk/commentisfree/2011/jan/10/george-osborne-tories-deficit-cuts)) is one of the best short economic articles I've read in quite a while

>>1498192
They're following people like Thaler, and it's pretty fail. They're hoping using nudges and suggestion can replace insentives. As I'm sure your aware, a lot of stuff is also for show. So I really doubt they were ever going to cut as harshly as they originally said, especially on defence, but they have to be seen to have compromised somehow.

>>1498230
This is a really good question unless you are trolling.

Yes. Capitalism can be hardly called Utopian as it Guarantees (and everyone knows it at the basic level) that there is no positive status quo. Tragically it is based on how we are built (Humans) at its base. Hence it is the most practical one. Sorry.

Other systems ARE utopian in that they promise a positive status quo. Historically they have been shown be either impossible or at least very painful to implement.

>>1498215

I'll explain:

The unemployment subsidy is a subsidy.

It's not a subsidy "on goods" (not really sure what this mean, but whatever).

That's why it's relevant, you retard.

You claimed that "Subsidies are given on goods".

Additionaly, your claim that a flat tax wouldn't work because social justice demands a progressive tax system (in your view, at least) is completely off. As I've tried to explain to you, the taxation system =! fiscal system. You can maintain a progressive fiscal system with a flat tax. You achieve progressiveness via subsidies, via a negative income tax.

This concept was developed and systematized more than 70 years ago, by Rhys-Williams. Milton Friedman - to name an economist you claimed to have read - was a big supporter of it and wrote widely about it in his books. The fact that the concept is foreign to you means you're nothing but a troll.
Capisce?

Plus, stop pretending you're an economist (or someone with any kind of formal training in economics). You're giving us a bad name.

>>1498249
American universal health-care: y/n

I don't understand how it would affect the profit-incentives of pharm companies, so I'm not sure what to make of it.

>>1498238
Yet you stated:
>more stable, reliable and self-adjusting
Which are throw away answers; there's nothing inherent in a market economy that makes any of those pretty vague terms true.

>>1498230
What do you mean by capitalism? Also by utopian?

>>1498249
>>1498249
thank you, this is both all and exactly what i wanted to know

>>1498261
>dictionary.com

>>1498255
>Additionaly, your claim that a flat tax wouldn't work because social justice demands a progressive tax system (in your view, at least) is completely off. As I've tried to explain to you, the taxation system =! fiscal system. You can maintain a progressive fiscal system with a flat tax. You achieve progressiveness via subsidies, via a negative income tax.

Now fit unemployment subsidies in this argument.

>>1498264
Dictionary dot com is about as enlightening as wiping my ass.

If anything I would say that market economy is susceptible to panic, hysteria, greed and incompetence, and thus is not really "stable". That's not to say I'm not pro-market, because I am. I'm a hysterical, greedy man.

>>1498247
On the one hand, the suggestion is we'll go back on the 1p fuel tax hike, which would be a "big hitter", supports the theory that the cuts will end up more moderate than first anticipated. However, just today they started breaking up £4 billion's worth of spy-plane despite protest from "former senior military advisers" saying we need them, implies otherwise.

I'm tempted to agree with you that once growth steadies the general population might be thankful for the austerity (though not necessarily for the government). But, there is more than economics in action here. The current government, in the legacy of two of the most socially radical governments of all, remains lacking in terms of social direction aside from the weak "big society" stuff. You might find that once the government/country becomes more economically comfortable, the Tories will begin implementing bills to define them as a social as well as an economic government, which will shape their overall perceived worth to the nation.

Personally, unless they do something to get rid of the Old School Tie Network, the growing class and North/South divides, they'll be a failure in my eyes. But, I'll be glad to live in a nation with less perilous spending.

>>1498269

Stop the trolling.

I mentioned unemployment subsidy as a counter-prove to your magnificent theory that "subsidies are on goods". I picked it because it's one you probably know very well - as I've added, there are plenty of others.

Hopefully you now understand why you can have a flat tax and a progressive fiscal system if you so desire.

Maybe you should retract from your first post and your pathetic example of two guys buying vegetables? Also, retract from your claim of having any sort of formal training in economics?

>>1498257
Sorry if they seemed throwaway. What I should have said was:

Compared to other systems we have tried. But that still is a throwaway answer. The complete answer is this:

1) Choice of goods you can purchase and hence increased bargaining power

2) Assurance of increasing quality due to competition

3) Higher opportunity to enter the market as a supplier

4) Larger revenues

(Assuming of course no carteling and monopolies).

>>1498284
>. The current government, in the legacy of two of the most socially radical governments of all, remains lacking in terms of social direction aside from the weak "big society" stuff

Why the heck should a government have anything in terms of "social direction"? Why would a few politicians have any sort of special input in such matters? What the heck "social direction" even means?

It's a pretty totalitarian concept, if you ask me.

>>1498285
The truth is, and you know i,t that Employment subsidies are not amongst those which were relevant to we were debating about progressive taxation equated to flat tax through subsidies.

It is true that Flat tax can be made equivalent to a progressive tax but THAT requires subsidies on goods and services as I clearly mentioned earlier. So I was right.

>>1498280
But I only agree.

Its just that it is much better than Planned economies, don't you think?

>>1498295

Dude, people can just read the thread and check what you wrote. You shouldn't use a tripcode the next time.

What do you think of this passage from a distributist website that says capitalism is contradictory (distributists say it, but Socialists say something like it too)

"The paradox is a consequence of capitalism being an economic system which, in the long run, “prevents people from obtaining the wealth produced and prevents the owner of the wealth from finding a market.” Since the Capitalist strives both for ever greater levels of production and lower wages, eventually “the laborer who actually produces say, boots cannot afford to buy a sufficient amount of the boots which he himself has made.” This leads to the “absurd position of men making more goods than they need, and yet having less of those goods available for themselves than they need.”"

source

http://distributistreview (dot) com/mag/2011/01/distributism-economics-as-if-people-mattered/

>>1498284
Meh, the spending was somewhat of a chimera, inflated by the other parties. I can't see either that they're going to close the class divide either; the university tuition fee increase is purely to disuade people to go to uni based on fiscal reasons (and to shut down the polytechnics), the privatisation of much of the school system is a joke (as well as the proposal to have state schools open over the summer), the cuts in retraining and unemployment benefit as well... It's all a bit of a joke really.

>>1498291
>Why the heck should a government have anything in terms of "social direction"?
Votes. The aim of the party is to get in power, and then remain in power.

>>1498291

This isn't the USA, where govts sole job is to ease the business of Business. European governments are expected to actually, you know, GOVERN.

>>1498291
Social direction: A political or governmental ideal for the workings of wider society and means in which to implement this idea. Thatcher's direction was to make Britain a top-heavy society in terms of power (more along the lines of dominatory, big-business capitalism than more fertile free market capitalism), and restrictions on unions and the role of the public sector were means to this end.

Labour had left leaning social direction, more a leftish take on a traditional New Right mindset. On the one hand, extended along a conservative line the tax breaks and subsidies for marriage and frequently targeted the middle class family in speech as well as policy. But also grew the benefits system and rolled out grass roots politics, which suggested an embrace of wider, collective society and the desire to use state power to foster diversity, where Thatcher wished to use state power to foster economic prosperity by streamlining society to fit into capitalism.

I can understand why Americans like the idea of minimal state interference (indeed, the existence of America came about as a backlash to an incredibly abusive and invasive regime and its entire constitution was written to prevent one ever returning). But, America also has one of the most significant rich/poor divides of anywhere. While it is seen there as a form of social justice in itself, I feel that to refuse to accept the economy can be a force in accentuating social divides to the point of being exploitative, or refusing to intervene to redress this balance to the benefit of the people (social direction as well as economic direction) is not the way a government should operate in my country. It would be more totalitarian, in my opinion, to not regulate the relationship between society and the economy, as it is proven that capitalism, even if the only truly workable economic model for large scale use on earth, has potential if unregulated to be damaging, unfair and exploitative.

>>1498312
Sure. Please find it here.
>>1498162


>>1498315
That it is misleading. It is true that the labourer producing goods almost never is capable of buying the goods. But it does not mean that he will remain a labourer all his life.

That paragraph reflects the fact of slave labour and not market labour that operates in say European countries or USA where the industry is indigenous.

Think about it: It applies to industrial-revolution days of yore and todays Africa and China, which are basically slave labour nations.

Who's fault is it really?

Its the moral fault of the corporations that invest in it and MORE the fault of the governments of that nation.

OP, your comments about Utopia are mistaken. There is a Utopia, and its economic system is traditionally conservative socialist You should know this, being, I suspect, from there yourself.

>>1498342
>There is a Utopia

whatthefuckamireading.jpg

Do you even know what "utopia" means? PROTIP: It doesn't mean "kind of a nice place to live".

>>1498342
Please give me your definition of Utopia and the meaning of "conservative socialist". Political science terms always confuse me.

>>1498319
The university issue is one I find to be particularly fun. I can afford to go to Oxford. My brother, who is going for a course worth far, far more than me (Engineering, the lucky cunt), can't. Or will struggle. He's going cap in hand to engineering firms to get the necessary grants. Plainly, this is unfair that churning out two reasonably intelligent humans should bankrupt the parents as well as the kids.

On the other hand, the only real reported reshuffles from universities are coming from art colleges, centres for media and what the snobs of /sci/ would call "bullshit liberal arts qualifications". So it implies that those who don't go get degrees will be the people who would have gone for the degree least worth anything, when cost is compared to extent employability is raised and average salary, which are things such as art, photography, media etc. While I think this represents the education system gaining robustness, generally speaking there is not evidence that meritocracy is unaltered by the move, so it's fundamentally wrong. It's generally a bit of a toss up.

>>1498349
>Thinks everything must be concrete
There is an idea
There is a viewpoint

>>1498355
>Plainly, this is unfair that churning out two reasonably intelligent humans should bankrupt the parents as well as the kids.

Is it more fair that I, having no kids, should pick up the bill for your education? What's wrong with taking out a loan?

>>1498352
a utopia, by definition, is unachievable/attainable

Why do people who study poli-sci always get economic stuff wrong?

>>1498360

You live in an idea, do you? And
>Thinks everything must be concrete
No, I just think that words have meanings. You're free to make words mean whatever you want them to, but don't be surprised when people who are using the commonly understood meaning call you on it.

>>1498366
I would disagree. Utopia means Ideal. Whether the idea is impossible or not decides whether the Utopia is impossible or not.

>>1498352

Australia.

>>1498349

Thanks for that sweetheart. I wonder if have you read Thomas Moore's "Utopia". Just a hunch, but I'm guessing not.

Pro tip: Shut the fuck up.
If not, shut the fuck up

>>1498329

I'm not American.


>Social direction: A political or governmental ideal for the workings of wider society and means in which to implement this idea.

To me, this is totalitarian.

I'll never understand why there are people willing to give so much power to politicians. Mentality of slaves, I suppose.

>But, America also has one of the most significant rich/poor divides of anywhere.

Elaborate, please.

>as it is proven that capitalism, even if the only truly workable economic model for large scale use on earth, has potential if unregulated to be damaging, unfair and exploitative.

Where it hat proven? And what is the less damaging alternative? And why is it unfair?

> It would be more totalitarian, in my opinion, to not regulate the relationship between society and the economy

Why should equality be a positive value? You have no idea what totalitarian is. The simple fact that you are willing to use the coercive force of the state to impose on others your worldview - of equality as a positive thing, for example - even against their will.

On the top of that, I think you're wrong. The economies with the most economic inequalities are generally more regulated and with more input from politicians.

>>1498390

What the fuck does that have to do with your stupidity in claiming to live in Utopia? Oh yeah, nothing. Thanks for playing.

Anyway guys. I am tired and will now leave the board. Just one thing I have understood about economics that I would like to share:

"Economics is an unstoppable and impartial, indifferent force. It can be brutal or it can be rewarding. The study and practice of economics is not to not only to act in the directions to maximize profit, but to reduce the effect of its brutality on people when situation so arises. Economic profit is is extremely essential but secondary to human betterment."

>>1498377
Well i do not wish to debate the issue

I wasn't being subjective you see

it literally translates to "unattainable" (or something like that, my greek is pretty casual)

today you would be using it correctly, but the anon was right

>>1498364
The average cost of an Oxford Engineering year under the new system will be about £13,500 a year, and this is a moderate estimate. Over four years, there is a great deal of difficulty finding a loan that will fill even to the extent that the funding we can provide will be able to complete the finance.

Also, arguably, it has been proven that tax investment universities constitutes as investment as it continually produces a larger number of people paying a high amount of tax, that will eventually cater for you as you spend a record length of your life as economically dependent rather than economically productive. Who knows, you might be one of the first to spend more time as a drain than a factor of the economy, in which case one should be glad for graduates.

Or that's what the hard-lefters would say. Personally, I fail to see how the idea of social investment is lost on people.

>>1498335
And the market labour in Europe and the US are in character different from the slave labour of China how? In just the amount earned? In unionization? In the amount of regulation?

You say that he need not not always be a laborer, but isn't that generally true only in times of economic boom? Aren't people to a certain extent always at the mercy of the system?

>>1498395

I didn't claim to live in Utopia. I have been there. It's Australia. It's probably where OP is from. And it was levity. I have read Thomas Moore's novel of the same name. I have read it, and thus have a more nuanced understanding of what Utopia refers to than do you.

>>1498396

Thanks OP. Some good stuff to consider there.

>>1498399

You know what would be a better investment for my old age? Putting my fucking money in a pension. Oh but I can't, because I have to give it to faggots like you and your brother, because it would be so unfair to expect you to take out loans to pay for your education.

>Personally, I fail to see how the idea of social investment is lost on people.

Having my money taken from me and given to faggots like you is not 'investment'. Where is my share certificate? At what point was I asked whether I wanted to 'invest' in your family of spongers?

>>1498396
please come back


next time be a sociologist

>>1498405
>HURR DURR I RED BOK

Guess what wisenheimer? I've read that book too. Are you seriously comparing Australia to the island in "Utopia"? If so, I guess you're even more stupid than your previous posts had led me to believe. If not, then I guess you're even more stupid than your previous posts had led me to believe.

>>1498394
>And why is it unfair?

Not OP, but I say it's unfair because at some point the class divide gets so huge your chances of crossing it is practicaly nonexistent no matter how smart you are and how hard you work and only way to become rich is to be born into rich family.

In a sense it's still fair, because after all we think lottery is fair...

I'm okay with social investment. You want to invest in "society", you do it.

I'm just not okay with social investment which is basically politicians taking way people's money and decide how to spend it (most of the time in ways that will allow them to keep their jobs i.e. satisfying their constituencies, be it voters or the big companies that pay for campaigns and will employ them after they retire from politics). Which is the proper definition of "social investment" these days.

>>1498399

Why would you have to take out bigger loan under the new scheme for this fee? It's not charged until you start earning in your career, and even then on sliding scale.

I think you've got this wrong.

>>1498421
>>1498421

I'm not the OP. Most of my posts in this thread were proving the OP was not an economist.

>Not OP, but I say it's unfair because at some point the class divide gets so huge your chances of crossing it is practicaly nonexistent no matter how smart you are and how hard you work and only way to become rich is to be born into rich family.

Yeah right. Studies? I'm actually an economist. I like to see that sort of claim supported with some empirical evidence. To me it seems that the consensus emerging from the history of economic facts study is that social mobility tends to be higher in societies where politicians have less power in their hands (which makes sense, if you think about it). That type of society tends to be more meritocratic.

>In a sense it's still fair, because after all we think lottery is fair...

I certainly don't think that, speak for yourself.

>>1498418

Levity. Look it up in a dictionary, darling. And I know you haven't read Moore's Utopia. It's obvious you talk more than you think.

>>1498438
>Moore's Utopia

I know enough to spell his fucking name right, cretin. Enjoy being a moron.

>>1498355
There's the whole "research funded by direct fiscal returns" bullshit bothering me. And that the argument for increasing fees boils down to wanting top end research institutes, but wanting unrelated undergrad students to pay for this. There's also a lot of reshuffling going on with non-academic staff. And the whole fee thing then turns students into consumers, while I have found unis want to ignore this effect.

>>1498394
To me, it's the only feasible way of using political power to the greatest possible benefit. But, I suppose the contention between the two of us is that greater equality is a deep-seated and fundamental ideal that I feel politics should pursue; and for you it isn't. The Burkean model of representation states that politicians are voted in to act in the best interests of the voters but not necessarily by following their exact demands (two core issues; first on most issues reaching a consensus is next to impossible, and people as emotional beings often make ill-informed and reactionary choices; see bank runs etc.), and I find this a much more desirable model than a minimalist view of representation of the people.

Two thirds of personal income from the American economy was reaped by 1% of Americans, implies an extreme domination of the majority by the minority, ultimately exploitative, etc.

Capitalism *is* the ideal system, however regulation ideally by reasonable governments over issues of pay and welfare should ideally be taken by governments to avoid situations such as the coal mining industry crisis of Thatcher's government. A period of the coal board's unrealistic pay scaling led to struggle by miners to survive, but the coal board's domination of land in the surrounding area squeezed out practically any alternative, meaning the workforce were essentially backed into a corner where they had little choice but to accept increasingly useless wages. Government refusal to act as a chairman between unions and coal authorities eventually led to the collapse of the coal industry, where progressive regulation would almost certainly have led to a more desirable outcome.

Also, two thirds of British government are millionaires, so if it was so that it wasn't the Government's interest to regulate the economy for the benefit of the masses, it would turn to a government of the rich and the self-serving, which *would* be totalitarian.

>>1498364
1. The idea that you and not big business are picking up the bills is frankly a lie. You are most likely a net drain on society if you look at how much you give to the government vs. how much you cost the government
2. Society benefits, and so you benefit, by having people with the appropriate education; you'll complain about having to educate a doctor up until you need medical treatment and have to see one.

nice thread. Doing an MSc in Economics here, with Health Economics

>>1497794
What's it like to have your entire field predicated on an ultimately unsustainable and unworkable theory of continuous growth?

>>1498441

I don't think you did know enough to spell his name, though. I think you looked it up on the internet, to check? Am I right, sweetie?

Read the book. And enjoy being alive.

>>1498459
>>1498459
>HURR IVE BEEN PROVEN AN MORAN SO ILL JUST PRETEND I WAS JOKING ALL THE TIME

>>1498410
I refer you to>>1498425

>>1498421
The 13,500 is a rough estimate on the top of the roughly 9,500 you can be expecting to pay for the course itself. On my parents' income, even, it would be difficult to manage. Also, it *is* a conservative estimate, it's likely to turn out a whole lost worse.

This was quite nice OP. So now tell us where you live. We can't do shit with that info anyway.

>>1498410
If we lived in a society where we didn't all benefit from roads, public transport, health care etc. etc. you might have a point. As it is, you are perfectly happy to rep the benefits of these things without consideration for the education behind them.

It's a simple choice: You either have something like a meritocracy, where people who are most able are educated to do the necessary job, and that requires subsidy; or you have an old boys' network, where it's about social background/money, and not ability.

>>1498460

You actually did look up levity in the dictionary. That's classic.

>>1498448
>To me, it's the only feasible way of using political power to the greatest possible benefit.

The mindset of a totalitarian, ladies and gentlemen.

Who decides which is the "greatest possible benefit"?

>The Burkean model of representation states that politicians are voted in to act in the best interests of the voters but not necessarily by following their exact demands (two core issues; first on most issues reaching a consensus is next to impossible, and people as emotional beings often make ill-informed and reactionary choices; see bank runs etc.), and I find this a much more desirable model than a minimalist view of representation of the people.

Yeah, I love the Bristol speech. I do agree that Burke's form of democracy is better than the alternative (be it direct representation, as it frequently happens in the US, or direct democracy). I'm not really sure why is that relevant. Burke would be horrified by your posts, by the way.

>But, I suppose the contention between the two of us is that greater equality is a deep-seated and fundamental ideal that I feel politics should pursue; and for you it isn't

You're awfully wrong dear. That would be the main difference between you and another totalitarian of different inclinations.

To me, politics shouldn't pursue deep-seated and fundamental ideals at all.

>Two thirds of personal income from the American economy was reaped by 1% of Americans, implies an extreme domination of the majority by the minority, ultimately exploitative, etc.

If you want to be taken seriously, you need to be sure you don't write nonsensical stuff like that. Do you really believe in what you just wrote? Can't you think for yourself it's just not possible? 1% making 2/3 of the income? You read (or misread) that and you actually believed it?

People need to start questioning things they read. It's amazing the inability to read critically economic/political information these days.

cont. >>1498481

>~Government refusal to act as a chairman between unions and coal authorities eventually led to the collapse of the coal industry, where progressive regulation would almost certainly have led to a more desirable outcome.

Yeah, that and the type writer industry.

If an industry can't survive without government interference (meaning politicians using others people money against the will of said people) it's because that industry doesn't deserve to be saved.

>>1498471
>It's a simple choice: You either have something like a meritocracy, where people who are most able are educated to do the necessary job, and that requires subsidy;

Lolwut? Why the heck does it require a subsidy?

It only requires a subsidy if the job isn't really needed. If it's a needed job, people will be willing to voluntarily pay those who are capable of executing it. No need for subsidies whatsoever.

>>1498483
However, that's not entirely true. There's an element of defence when it comes to necessities like food and energy, so something like a coal industry may well be beneficial to save. An example would be if the alternative was sole energy supply from Mother Russia; then it becomes a similar issue to keeping a military.

>>1498494

Theoretically, yes.

In the real world (especially in today's nuclear world where global wars of attrition are basically an impossibility), that's generally an excuse to commit corporate welfare. I mean, it was certainly not the case of the coal mining in the UK, which main competition was actually the oil from the North Sea.

>>1498488
Medicine will always require some level of subsidy due to the massive costs involved. You also can't have it based purely on actual cost of the degree per person, because then to have an English degree would be far cheaper than any science/engineering/medical degree, and you'd have a science skill deficit again. Then you have to consider the psychological factors, that are usually considered to exist, but for economics on a large scale hoped to be negligible (it's argued that it's rational to still study with increased tuition if the appropriate loans are available). However, for people with lots of money and connections, this rationality is clear or not even a factor in their decision (if they don't need the loan); it is a psychological factor primarily for people from poorer backgrounds.

On top of that, the loans have to come from somewhere anyway. Do you really think you are not subsidizing that? Or the people who never pay back their loans?

>>1498503
>Medicine will always require some level of subsidy due to the massive costs involved.

What the heck? Why? There are lots of stuff who involve huge costs and don't require any level of subsidy.

>You also can't have it based purely on actual cost of the degree per person, because then to have an English degree would be far cheaper than any science/engineering/medical degree, and you'd have a science skill deficit again.

Why? You seem to fail to grasp the simple concept of dynamics. Of course a medical degree would be more expensive, but on the other hand a doctor would also make a lot more.

>Then you have to consider the psychological factors, that are usually considered to exist, but for economics on a large scale hoped to be negligible (it's argued that it's rational to still study with increased tuition if the appropriate loans are available). However, for people with lots of money and connections, this rationality is clear or not even a factor in their decision (if they don't need the loan); it is a psychological factor primarily for people from poorer backgrounds.

No fucking idea what this means. What "psychological factors" exactly?

>On top of that, the loans have to come from somewhere anyway. Do you really think you are not subsidizing that? Or the people who never pay back their loans?

Relevance? They shouldn't subsidize loans. People who never pay back their loans? That's called the financial risk. It enters in the calculation of the lenders. A pretty well known concept for..hmm... millenniums?

>>1498512
Warwick university is a young university, yet third richest in the UK. Part of the reason is that they've avoided high cost degrees like medicine and dentistry, unless appropriate funding has come along and made it profitable.

For medicine, you need anatomy models (each one costing ~£1000), textbooks (also expensive), medical equipment (£x00,000), staff costs (£x00,000), use of hospital resources... it's easily in the region of millions per year for a medical school. However, you maybe have a few hundred medical students in at any time. Some costs can come from foundations, some can come from pharmaceutical companies, but there are reasons why it's bad to depend on such streams. The funding tends to mostly come from the NHS.

>Relevance? They shouldn't subsidize loans. People who never pay back their loans? That's called the financial risk. It enters in the calculation of the lenders. A pretty well known concept for..hmm... millenniums?
You need to look at the rate of interest on those loans, as well as the ROI. They're not financial investments in any sense of the word, and if they were they'd become a barrier to study (in that it would unlikely be rational to want to study considering the costs/risks).

>>1498512
The other points are a little retarded:
If I don't know I want to be an engineer or a doctor, why pay for an expensive degree? If all I know I'll need is a degree, then cheapest wins.

Psychological factors are non-"rational" tendencies. So I may dislike the idea of having a big loan, though the potential return and potential risks are favourable; that's not "rational" in the economics sense of the word.

>>1498573
>Some costs can come from foundations, some can come from pharmaceutical companies, but there are reasons why it's bad to depend on such streams. The funding tends to mostly come from the NHS

Which is to be expected, considering the NHS is the main employer. I'm not really sure why this proves subsidies are necessary. You're basically saying "the status-quo proves that no alternative to the status-quo exists". Which is a silly fallacy, to say the least.

>You need to look at the rate of interest on those loans, as well as the ROI. They're not financial investments in any sense of the word, and if they were they'd become a barrier to study (in that it would unlikely be rational to want to study considering the costs/risks).

Yeah, my point is that they should be financial investments. There's no reason why those loans should be subsidized.

If you want to avoid a situation where the investment on education discourages poor students from studying, you can simply use direct subsidies to them, which at least are a lot more transparent.

>If I don't know I want to be an engineer or a doctor, why pay for an expensive degree? If all I know I'll need is a degree, then cheapest wins.

Huh, wat? If you want to be a doctor, you opt for a medicine degree, if you want to be an economist, you opt for an economics degree and so on. If you just want a degree, you can opt for the cheapest degree or, more probably, for the easiest. Again: what's the relevance of this?

>>1498573
>Psychological factors are non-"rational" tendencies. So I may dislike the idea of having a big loan, though the potential return and potential risks are favourable; that's not "rational" in the economics sense of the word.

I don't think you know what is "rational" in the "economics sense of the world"

What matters is this: you make your own decision. You think the risk is too high? You won't study. You think it's worth it? You take the loan. Both decisions are rational. Opposite decisions can be rational every time. "Rational" doesn't exist as an objective standard.

>>1498641
Most people are unaware of what they want to do for the rest of their lives at 18, we live in a world where we'll probably have to change careers too (job for life is a total fallacy). HR departments mostly will look at level of degree, not what the degree is. Also, law, for example, is relatively inexpensive as a degree, but graduates get paid well.

>There's no reason why those loans should be subsidized.
They're high risk loans with little return, they have to be. If they have high return, the real cost of getting a degree goes up significantly if you have less money, thus a real barrier. If they're made low risk artificially, then they still get subsidized due to bankruptcy or similar. On top of that, there has to be a loan holiday for the period up until work can be found, or they'll be making repayments while studying, another barrier.

Direct subsidies are fine in theory, but they can be incredibly inefficient in practice. Best way is to use both, if you go down the route of fees.

Also, NHS is part of the government, so funding from them is government subsidy, Engineering or Science degrees can get some funding from private business, but that has its own problems, much like pharm companies.

>my point is that they should be
This isn't an argument, I'm simply explaining how and why things are to you.

>>1498642
I'm afraid you don't. Risk, return etc. are all very well defined in economics. It's assumed that agents have perfect knowledge of these factors and act on them in purely rational ways. However, this is not the case, thus "psychological factors". And rational is objective, since we're generalizing for a population and not differentiating between agents.

Oxfordfag who left this thread a while back. I'd like to point the only reason I went for Oxford, my first choice, is that I have a relationship of sorts with the Beeb, otherwise I would have copped out to somewhere cheaper, possibly Warwick.

The Financial Crisis Inquiry Commission just released a 622 page book about the crash 2 years ago. Have you read it or will you read it?

The democratic majority of the commission said that the crash was caused by predatory lending, "toxic mortgages", massive bank growth and profits and poor regulation. The republicans point at interest rate issues and real estate bubbles. Essentially, democrats are saying that greed and ignorance caused it, while republicans are saying it was inevitable, something no one could have seen coming.

To me, an outsider to macroeconomics, it is extremely bizarre that no one can be certain what caused the crash. Is the system that much beyond our vision? We created it, but when you listen to economists its as if they're out on safari examining wild animals and unknown ecosystems. While I understand it is a fluid system, that its behavior tomorrow is largely unknown, why is its past activity so hard to pin down?

>>1498696
>Most people are unaware of what they want to do for the rest of their lives at 18, we live in a world where we'll probably have to change careers too (job for life is a total fallacy). HR departments mostly will look at level of degree, not what the degree is. Also, law, for example, is relatively inexpensive as a degree, but graduates get paid well.

Again, relevance? I have no idea if most people are unaware or not, but why does it matter? They may stop studying and get back later if they want to.

>They're high risk loans with little return, they have to be.

Geez...

Can't you understand that the only reason they are high risk and still have little return is because they're subsidized?

Again, you're simply saying "it's the way it is so it can't be any different".

>This isn't an argument, I'm simply explaining how and why things are to you.

I know how things are, I've published stuff on this subject, I do it for a living.

The argument is about the necessity of subsidizing the loans or not. That's a be/should be argument, not a "what is" one.

>I'm afraid you don't. Risk, return etc. are all very well defined in economics. It's assumed that agents have perfect knowledge of these factors and act on them in purely rational ways. However, this is not the case, thus "psychological factors". And rational is objective, since we're generalizing for a population and not differentiating between agents.

Not really. With all due respect, you have no idea about what you're talking about. Individuals that possess perfect information is an assumption used mostly in formal modelling and only under certain frameworks. I know it's a popular concept under non-economists (that economics assume full information and that agents act in purely rational ways and whatnot), but it's a myth. It's merely a concept, a very useful theoretical concept.

Also, "rationality", in this context, means something entirely different. As I've tried to explain, you can't really define a priori a "rational" decision. It's an instrumental rationality, meaning the agent will decide in a way that suits his preferences. Again, as I told you, deciding to study or not to study can both be rational decisions. Depends on what the person making the decision values more - and what people value is subjective, it varies from person to person.

You're afraid I don't what?

>>1498755
>While I understand it is a fluid system, that its behavior tomorrow is largely unknown, why is its past activity so hard to pin down?

Because they're too complex. What you mean by "the system"? And "we created it"? Who are "we" and what is "it"?

Historians have different interpretations for what happened all the time, it's to be expected the same happens with economists.

>Essentially, democrats are saying that greed and ignorance caused it, while republicans are saying it was inevitable,

They're saying basically the same thing. Beware of anyone who believes that things like ignorance can or should be wiped out. It generally ends in millions of people dying.

>>1498760
>I know how things are, I've published stuff on this subject
I'm literally regurgitating stuff from professors up at you. You're also failing to grasp some pretty basic stuff, so I'm unconvinced.

>Can't you understand that the only reason they are high risk and still have little return is because they're subsidized?
>Again, you're simply saying "it's the way it is so it can't be any different".
That's not what's being said at all. For them to have any return, they'd have to have interest rates significantly above the base rate, causing people from poorer backgrounds to pay more for the same education (not a meritocracy). The risk factor will always remain; at the end of my degree, why would I not declare myself bankrupt if I have significant debts for example?

>Again, relevance? I have no idea if most people are unaware or not, but why does it matter? They may stop studying and get back later if they want to.
Replying "Relevance?" does not a point make. You need a certain number of lawyers, scientists etc. in society, so to have it heavily skewed towards Law at the expense of Engineering, for example, is not beneficial.

>>1498764
Psychological factors is a common term.

>Individuals that possess perfect information is an assumption used mostly in formal modelling and only under certain frameworks. I know it's a popular concept under non-economists (that economics assume full information and that agents act in purely rational ways and whatnot), but it's a myth. It's merely a concept, a very useful theoretical concept.
It gets used, oh no it doesn't, oh it does...

Wishy washy, entry-level economics student detected.

>>1498794

Professors of what?

What basic concepts am I failing to grasp? You have to be more exact.

>For them to have any return, they'd have to have interest rates significantly above the base rate, causing people from poorer backgrounds to pay more for the same education (not a meritocracy).

Again, the most efficient way of dealing with that is through subsidies directed towards the poor students. More transparent.

>he risk factor will always remain; at the end of my degree, why would I not declare myself bankrupt if I have significant debts for example?

I don't know. I honestly have no idea what you're arguing. Of course the risk factor would remain. The price of the loan, the interest rate, would be higher. You can declare yourself bankrupt now. Don't you think lenders know that? Don't you think you already pay the price for that whenever you have a loan?

>Replying "Relevance?" does not a point make.

It makes the point it's not relevant.

>>1498861

>You need a certain number of lawyers, scientists etc. in society, so to have it heavily skewed towards Law at the expense of Engineering, for example, is not beneficial.

Again, for the 204843th time: why are you assuming that things would become heavily skewed (and not that they're skewed in the current scenario, for example)? You need to think out of the status-quo assumptions to understand this. There's a beautiful thing called the price system. Through it, any skews would self-correct. If there was a shortage of doctors, then the price of doctors (their wages) would increase and that would encourage more people to become doctors. And vice-versa. That's how 99% of the economic world works. Billions and billions of economic decisions informed through the price system every freaking minute. For example, we also need certain amounts of meat, vegetables, bread, food. Does it mean we should start subsidizing the entire food industry to prevent it from becoming heavily skewed?

The only sound economic reason to justify those loans would be by arguing externalities (which you actually may be trying to do in a very clumsy way). Try to read something about that concept. I and many others wouldn't accept it, but others would agree that high level education should be subsidized as long as it produces positive externalities. Of course, you need to prove that education externalities actually exist, which isn't easy at all.

These subsidies are an absurdity that actually distort and skew the price system - your nightmare is actually caused by the current system. The society may not need another engineer, but if the degree is subsidized, than they'll stay in production. Actually, it's a hot trend of these days, many prominent economists defend that we're living a higher education bubble, similar to the housing bubble. I think there are alarming signs of that.

I think labour theory of value is bullshit, how about you?

>>1498807

Again, perfect information is a theoretical concept used in formal modelling.

Can you understand this?

Can you give a practical example of someone not making a rational decision due to "psychological factors"? It can be fictional. It may be the only way you may understand what "rational" means in this context.

>>1498862
>>1498861
Professors of economics, and not books vaguely about neo-liberal economics, which seem to be the fountain of knowledge you've got your arguments from.

And science deficits happen, and they have happened, you should know this.

>>1498866
I have, but this might help you:
http://www.lmgtfy.com/?q=psychological+factors+economics

Nearly every link will point out the difference to you.

Sup?

>>1498921
Go away, Niall. These are my people, you are not welcome here.

What do you think is the future of money?

>>1498889

I can google "psychological factors" myself. I'm not sure what's your point. You should have understood by now I don't care for that sort of "debate techniques". We're arguing about what "rational" means in the economics sense (mostly under the framework of rational choice theory).

Here's what I challenged you to do:

Can you give a practical example of someone not making a rational decision due to "psychological factors"? It can be fictional. It may be the only way you may understand what "rational" means in this context.

Are you going to man up and do it or not?

>>1498949
It's not a debate when you can do a quick search and every single relevant paper makes a distinction between psychological factors and rational factors. I think your problem is a misunderstanding of rationality in economics terms.

>Are you going to man up and do it or not?
Yeah, keep refreshing the page and see.

>>1498872

I don't have the time and the patience to answer to ad hominem arguments or personal insults. Just to let you know.

What the heck is a "science deficit"? I don't like to discuss using that kind of expression.

Anyway, I my explanation helped you to understand why subsidies are what distorts and skews (and leads to irrational decision-making according to some), not the non-existence of subsidies.

Btw, here's an article on the higher-education bubble:

http://chronicle.com/article/Will-Higher-Education-Be-the/44400

>>1498944
Commodities will become money, bro.

>>1498964
>I think your problem is a misunderstanding of rationality in economics terms.

Doubtful. I've explained it in the thread:

>>1498764
>>1498642

I think your problem at the start was assuming that rational = good, sane, what makes sense in the long run (in this case, pursuing a degree). However, that's not what rational means at all (in the economics context). From an economics perspective, rational is value-free. It's purely instrumental. It just means decisions aren't random.

>>1498965
Dude, I'm familiar with Friedman, Von Mises, Hayek... you haven't explained anything. You seem to think there was some debate here, and I haven't even put my own views forward.

And you can google "science deficit", right?

>>1498988
>What matters is this: you make your own decision.
>"Rational" doesn't exist as an objective standard.
Good, but wrong. Nice try though. The question is how to minimize economic loss/maximize economic gain. Nothing to do with "own decision" or what the individual thinks rationality is.

I'm teaching you quite a lot here, you could at least be thankful.

resource based economy.... profit breeds corruption and there is absolutely no reason for it. You can not be ethical in any profit system. Catalog the worlds resources, name them heritage of all people,...explore the universe.

>>1499031
You'd like "Small is Beautiful".

>>1499040 just downloaded to the ol nook.

>>1498998

Why mentioning Friedman together with Hayek and Mises? That's odd. And why mention those in the first place?

Yeah, I can find plenty of definitons for what a science deficit is. How is that helpful for your case that subsidies to loans are needed? It isn't, you just want to pretend the discussion never existed by bringing random stuff to the table.

>>1499013
>The question is how to minimize economic loss/maximize economic gain. Nothing to do with "own decision" or what the individual thinks rationality is.

Nope (it's funny how you can't understand how the 2nd sentence doens't follow the 1st - which is actually more or less correct). A rational decision is one that the individual makes acting as if - AS IF - he balances costs and benefits to maximize personal utility or preference. That's the textbook definition, btw.

So, taking and not taking the loan can both be rational decisions for two different individuals, as long as they have different utility functions.

>>1499031

incentive is a valuable resource for any economy

of course things can go too far; they can go too far both ways

a healthy economy is one with a balance between freedom and security

profit and tax

>>1499049
They're all part of the neoliberalist thought.

And now you're saying that rationality is not subjective, but objective. On top of that:
>A rational decision is one that the individual makes acting as if - AS IF - he balances costs and benefits to maximize personal utility or preference.
Is the same as:
>>The question is how to minimize economic loss/maximize economic gain

Since this is now boring, but I feel sorry for you:
"own decision" implies radical choice, which then implies an ability to make the irrational choice (that's Rawls man). In this sense of rationality, there is only 1 rational choice, as such no decision is made.

Economic loss and gain are the same as minimizing/maximizing utility and reward.

While the decisions made might vary on an individual level, what rationality is does not.

Rational choice in economics terms also includes actions such as killing, stealing, cheating, which we might consider insane and irrational. So what you or I call rational is not the same as rationality in economics by a long shot.

Why does the US economy need the Federal Reserve Bank?

Should the government have more over site?

>>1499112
>They're all part of the neoliberalist thought.

What the heck is that? That's not how economists talk. There isn't a "neoliberalist school". Actually, they belong to pretty opposite school of thoughts. Protip: if you want sound like an economist, don't use "neoliberal". Use terms like neoclassical school or Chicago school (or Austrian economics) instead. You won't find many mentions to neoliberalism amongst economic scholars, the expression is too charged ideologically and has no meaning in the history of economic thought.

Btw, I'm a fan of any of those philosophers.

>Is the same as:

It's not.


You fail to understand the importance of the "AS IF" particle, in spite of my best efforts to highlight it.

>Economic loss and gain are the same as minimizing/maximizing utility and reward.

Actually, they aren't. A guy won a Nobel prize by detailing those distinctions, can you believe it? Anyway, let's stick to the proper understanding of rationality, that's enough for you at this point.

>Rational choice in economics terms also includes actions such as killing, stealing, cheating, which we might consider insane and irrational. So what you or I call rational is not the same as rationality in economics by a long shot.

What you call rational is not the same as rationality in economics - that's why I've been saying all along. Since my first post I said that. That's why your original point was so nonsensical. That's why I told you that in economics the term was value-free and didn't imply sanity.

Btw, can you now point out the practical example I requested from you or not, the one where psychological factors lead to an irrational decision? Prediction: you won't.

>>1499172
Here we go:
>>Psychological factors are non-"rational" tendencies. So I may dislike the idea of having a big loan, though the potential return and potential risks are favourable; that's not "rational" in the economics sense of the word.

>I don't think you know what is "rational" in the "economics sense of the world"

>What matters is this: you make your own decision. You think the risk is too high? You won't study. You think it's worth it? You take the loan. Both decisions are rational. Opposite decisions can be rational every time. "Rational" doesn't exist as an objective standard.

So you've been begging for an example, yet here it is. There is no good reason to NOT take out the loan, except I believe that borrowing money is bad. What has this belief got to do with utility?

Your mistakes were "own decision" and ""Rational" doesn't exist as an objective standard."

It's a term used in so much economics literature, I can not imagine what you've been doing to miss it. And whether neoliberal gets batted about as a term depends heavily on which uni you're at. I'm guessing yours is fairly right wing, fairly small. Chicago school and Austrian school are not on opposite ends by a long shot; Austrian school was a massive influence on Chicago school.

Don't even get me started on individual preferences in rational choice, but yet again you seem to have not understood it.

OP you're a stupid eastern european faggot and nobody likes you

>>1499238

Are you the OP or something? At least you don't claim to be a trained economist.

>And whether neoliberal gets batted about as a term depends heavily on which uni you're at. I'm guessing yours is fairly right wing, fairly small.

lol wut? Look, neoliberal simply isn't used in economics because it has no sound meaning. It's a very ideologically charged term, it's generally used as a pejorative designation to neoclassic theories . That kind of shit doesn't have a place in the academic world. LOL at the idea that the size of the university matters to how the term is perceived. Economics isn't "cultural studies" btw, that "right/left" wing exists but differently, there isn't the division from university to university.

>Chicago school and Austrian school are not on opposite ends by a long shot; Austrian school was a massive influence on Chicago school.

You have no idea what you're talking about. They're epistemologically opposed. Chicago school belongs to mainstream economics, Austrian is a heterodox school.

Again, analysing things from an economic perspective takes a very different stance than the one you're used. Just because from a layman perspective like yours they seem to defend similar stuff in terms of public policy, doesn't mean they're close in an economic sense. They aren't. They're extremely far away. Absolutely different methodologies, assumptions and epistemologies.

>So you've been begging for an example, yet here it is.

Where? I can't see it. Please provide a practical example. A good old fashioned parable (a very dear tradition of economics science, the use of parables). Something like "Here's Peter. Here's the situation. Here are the psychological factors. Here's his decision. It was irrational because this and that".

>There is no good reason to NOT take out the loan, except I believe that borrowing money is bad. What has this belief got to do with utility?

Wait, wast this the example?

What are the psychological factors? Was the decision rational or not rational?

And yeah, it has EVERYTHING to do with utility. You have no idea what utility is in the economics sense.

"I think borrowing money is bad" -> utility function.

Yeah, I know it's kind of weird, but economics has its own jargon and most of the words have a different colloquial meaning.

>>1499326
Some unis are right wing, some centrist. There are a minority of left wing institutions. Any of these can have an econ dept.

>>1499337
>>1499326
Come back when you understand utility in an economics sense. That's probably after you've studied Pareto efficiency in detail. Then we can talk without you fluffing every post.

And by the way, I'm not a right-winger, far from it.

You'd be surprised by the number of left-leaning economists who would defend that subsidizing loans is stupid and inefficient and should be replaced by direct subsidies to poor students.

Let me explain something (actually something that the OP should have done in the first place):
Economy can be normative, expressing value judgements; or positive, wertfrei economics. In the later, it doesn't really matter if you're left or right (even though it can matter if you're mainstream or heterodox[Austrian, Marxist, etc] ).

The answer to this question is something most economists could agree to, regardless of their normative views (much to your chagrin, I suppose). Just like they agree in what perfect information is or the rationality assumption, even if they don't agree on how useful are the models built under that framework.

>>1499356
>Come back when you understand utility in an economics sense. That's probably after you've studied Pareto efficiency in detail.

Well, actually it's the other way around: one learns about utility way before even touching Pareto efficiency. It couldn't be any other way.

We teach the concept of utility early in the introductory concept. Most undergraduates already master it beforehand anyway, it's like the foundation of the entire structure of modern economics.

It's not that difficult to get the meaning, once you get over the temptation to attribute it the colloquial meaning. So, once again:

>There is no good reason to NOT take out the loan, except I believe that borrowing money is bad. What has this belief got to do with utility?

EVERYTHING. The belief that borrowing money is bad is actually the revelation of the utility.

>>1499361
>The answer to this question is something most economists could agree to
Hang on. It's not. Look at the European institutions and how they handle student loans. The US is a special case for the way in which they handle student loans, with them being completely private.

>>1499396

So? There are lots of stuff most economists can agree on that are handled differently in the real world.

Free-trade is an excellent example of that. Only a tiny minority of professional economists is against free-trade yet there are plenty of tariffs and restrictions subsisting all over the world.

>>1499384
Except it's not. I think I see your problem:

There's no way in hell I'm taking out that loan, HOWEVER;
If I do take out the loan AND I find that despite this utility was higher in the medium/long term than if I didn't, then that is the rational choice. It doesn't matter if at that moment of taking the loan I would have rather not been.

You want utility to be in a single moment temporally, and it's not. inb4 dynamic methods, I'm also not including the impossibility of knowing future choices, or having to compare possibilities, which comes under bounded rationality.

That you thought you understood all the nuances of utility in introductory classes is telling, and showing.

>>1499416
Except economists do agree on how student loans are handled, in the UK the system was designed in part by economists.

Do you study economics?

>>1499475

I teach History of Economic Thought at an European university. I study yeah, mostly research.

>Except economists do agree on how student loans are handled

How are they handled? Don't they have an interest rate indexed to the inflation rate plus income related repayments? To me that's extremely absurd, it doesn't make any sense from an economic perspective. Not only it's freaking expensive, it mostly helps those who don't need the help.

Who are the economists that agree?

Quick google by "student loans uk subsidies".

First entry returned, an article by an economics professor.

Title?

Interest subsidies on student loans are the root of all evil

http://www.independent.co.uk/news/education/higher/nicholas-barr-interest-subsidies-on-student-loans
-are-the-root-of-all-evil-1926574.html

So yeah, I really doubt many economists would agree with the current system.

>>1499512
Nicholas Barr and David Greenaway have written on the subject. There's an old paper from Oosterbek comparing different forms of education payments, and looking at the psychological barriers.

>it mostly helps those who don't need the help.
Uh no. The main thing, and one you should be aware of if you're in academia and economics, is the need for increased HE funding. Subsidies to the individual don't solve the problem of government needing the money to pay out in the first place. However, having a loan means money can be leveraged directly from the students (in a sense), and it's thought that this will have the least leakage compared to other ways of recouping cost, like a graduate tax. Now, it's important to incorporate equity into the funding, so the interest rate is only set to the BoE base rate, and not higher as in America, and not lower as that's a ridiculous incentive to borrow as well as lose money. In reality though, the loan always has a lower interest rate than any saving account's, so there's always an incentive. If it was set at a normal loan rate, this would mean the cost of the same education for someone from a poor background would be higher than for a rich background, which is of course unfair.

Anyhow, the equity is important if you wish people to enter a position in society based on merit, not on money. This is where utility is truly increased.

Personally, I disagree with having undergrads pay for research (this makes no sense) or why increasing funding in HE is the best thing to do. The loan in practice is also full of problems.

>read OP
>202 posts and 8 image replies omitted.

>checking whether Econometrics is a valid science or not

your father and you are dumb as a rock. "economists" who use "economy" for the solemn purpose of achieving money.

>>1499579
>Don't they have an interest rate indexed to the inflation rate plus income related repayments? To me that's extremely absurd, it doesn't make any sense from an economic perspective. Not only it's freaking expensive, it mostly helps those who don't need the help.
How has that got anything to do with subsidies?

It doesn't change that the argument has been all along "If you have this system, loan subsidies are a necessity", which has been illustrated over and over again. The money for the loans doesn't come out of nowhere, the money to replace the leakage also doesn't materialize mysteriously. They're costs that the government has to pay. On top of this, who will take a low return, high risk loan, a necessity if you want equity in the loan system? It won't be private enterprise.

>underdeveloped countries

claims to know economy.
no. study moar

>>1499711
you got pwned.

>>1499685
and he's a tripfag to boot. Even for this one post.

>>1499512
>I teach History of Economic Thought at an European university
It's cool that that allows entry level reading of economics and hours of browsing 4chan.

If I get a master's in econ from a canadian or american university, what are my prospects for teaching in Europe?

Most Universities here want you to have a Phd to teach

>>1500187
You can teach while doing a PhD as a graduate. With just a Masters there's no chance of you becoming a lecturer though, you'd need something else to qualify.

Do free-markets exist?

It seems every market has interference, regulation, taxation, subsidies, and since they are all becoming globally interlinked, when one market gets regulated then so do the rest, no?

OP is from China.

>>1497814

>>1500199
>do true free markets exist
No. Should they? I think not.

>One market regulated = all markets regulated
That's very true.

>>1500483
mis-spelled trips

>>1500488
I prefer him tbh.

>>1500573
nice to know. I meant that I mis-spelled my trips.