/lit/ - Literature

>>16297494

Prior to reading this I had little to know understanding of basic economics in the US and worldwide. I also didn't lean to any particular economic system or political framework.

The book is a little under 700 pages though the last 70 are index and review questions for the reader. I was a bit hesitant to start something I wasn't sure I was so interested in but it wasn't a difficult read at all and because a lot of things I'd heard of but didn't really understand were explained well (stocks, bonds, taxes, regulation, markets, etc.), I maintained interest till the end.

This is what Sowell does best in the book. He really does a good job making clear what these words mean and how they function in a society. I am much more aware of how an economy functions under a government and its citizens after finishing this book. I've also become more interested in economics generally, and will hopefully get around to reading more classical texts in the future.

Now, while this book is titled Basic Economics, don't be fooled into thinking this is unbiased. Just about every proposition or argument is underpinned with the idea that an economy will function best under a free market. He never criticizes the free market and states the only place where the government is better than the market at making decisions is when considering external costs. I find that he's not so much wrong in what he says, rather it's what he doesn't say that is problematic.

On a personal level, he's lured me away from socialism (though I still plan to read more from such a framework) and I agree that markets are much more efficient than CPBs. On the other hand I think the government can play an important role in regulation and social services such as health and education.

If anyone, especially US citizens, wants an intro to basic economics, I'd recommend it. Just read carefully and cross reference his claims.

tl;dr - Easy to understand explanation of basic economics. Extremely biased so if reading take care to cross reference

>>16297521
>On the other hand I think the government can play an important role in regulation and social services such as health and education
If you agree that the free market is better (it supplies better quality products at lower prices at maximum possible volume) then there is no reason to exclude - arguably - the most important sectors from the system.
Notice that you didn't include food production in the list; you intuitively know that the consequences would immediately become disastrous.

>>16297494
Now read the works of Ha-Joon Chang for a different perspective, and learn about the shortcomings of the free market.

>>16297786
>Reading a korean

No i'd rather die

>>16297791
He's at Cambridge and writes in English. You'll learn a lot more about the real world from him than you will from Sowell.

>>16297685

Well it's not intuitive. Sowell points out the inefficiency of food distribution in the soviet union even though they had some of the best farmland at the time.

Regarding health and education, he hardly mentions either in the book at all. I grew up in the US and currently live in a country with national health insurance and my personal experience with the system is much more preferable to the US. Not only have other expats said similar, but most or all of the countries with health systems continually ranked at the top have national health insurance or something similar.

>>16297685
What a pseud you are. Stop attacking strawmen. OP already mentions externalities in his post.

>>16297798
Hahaha yeah sure buddy

>>16297799
>but most or all of the countries with health systems continually ranked at the top have national health insurance or something similar.

However they still have free market mechanisms working in healthcare. Mandatory insurance or government provided insurance does not mean that there is no free market in healthcare. In these countries hospitals and drug manufacturers are still for-profit organizations.

>>16297799
>the system is much more preferable to the US
The US has government enforced healthcare cartels - you cannot open a hospital - or even practice medicine at all - without your competitors' approval. It still has the best quality in the world, just at exorbitant prices.
In countries with nationalized medicine you can notice the low quality by looking at very long waiting times, you wait almost half a year for an appointment with specialist physician in Canada (it's actually the only case that matter, as common, basic illnesses would not normally even require any health insurance). Long term consequences of this are yet to be proven, but they can easily be predicted.

>>16297494
Nice to read this. I got it on libgen the other day, but I was afraid I was gonna be meme'd

>>16297874
>>16297892

Just to be clear, I'm not saying "free market bad" but that government subsidies to the health care system results in lower prices for more common visits like sprained ankles, cavities, fevers, etc. I consider this a good.

>>16297521
>I was a socialist but now I'm not
Doubt.epub

>>16298210
cmon, each and every graduate of a public school system is a socialist by design.

>>16298228
How so?

>>16298228
Not in America. I grew up in a progressive state and even we were taught the usual pro-capitalist, patriotic history of the US. You start learning more about socialism in university, but even there most of the professors outside the sociology department are just typical liberals.

>>16297874
>In these countries hospitals are still for-profit organizations.
At least here in Germany most hospitals are still non-profit public institutions and belong either to municipal/county/regional governments, universities or churches.

>>16297892
Right but don't we still need the government to step in and make sure that drug prices are affortable? Leaving that completely to the market seems like a bad idea.

>>16298228
>each and every graduate of a public school system is a socialist by design.
Lol what? Going through public school only makes you hate public stuff even more so

Anyway, the primary reason not to be a socialist is that LTV is wrong. And if LTV is wrong, you can’t have socialism. EOT.

>>16297521
If Sowell was right you could of made a killing betting against the Japanese government bond market for over the past decade... but turns out he's wrong.

>>16298355
The labour theory of value isn't a justification for socialism, it's supposedly an explanation of income distribution under capitalism... Marx went on and claimed it proved some long run problems but if the labour theory is wrong it doesn't have any implication for socialism... most people who refer to the long run are justifying conservatism today not socialism.

>>16297786
Usually stories about the problems of the free market start with the government granting monopoly rights or otherwise preferential treatment to a company. Is this book any different?

>>16298303
>Right but don't we still need the government to step in and make sure that drug prices are affortable?

There is an issue with creating artificial pricing via govt. action, since there are costs involved with developing those drugs. However, they should not be allowed to charge wildly different prices in other countries compared to the US -- just in my opinion.

There should be more paths made in keeping price-gouging to a minimum, and the medical industry is very guilty of that practice.

>>16299404
No, it's essentially about how rich, developed countries preach the virtues of the free market and free trade to poor countries despite the fact that all those rich countries got rich by enacting protectionist policies and subsidizing certain industries. He says that freer markets might work in countries that are already highly developed but that developing countries need to subsidize and protect companies in expensive infant industries because they will have no chance competing with foreign companies that are already well-established in those industries. He's arguing for a type of economic nationalism.

>>16297521
>He never criticises the free market
He does
Multiple times
Stop lying

>>16298533
Nigger, what?
How can you have socialism without LTV

>>16299487
He is an ahistorical retard if that's his arguement
But then again he is an economist so one can't have their expectations very high

>>16297494
this nigger was debunked 150 years ago
https://www.marxists.org/archive/marx/works/1894-c3/ch10.htm

>>16299549
No, he's actual an incredibly historical economist. That's why I hold him in higher esteem than most economists. Rather than relying on old models and theories to tell us how economies function or ought to function, he just looks at how they have functioned in the real world throughout history and draws conclusions from there.

Every thing that has been said in this thread is crushed by this picture

>>16299529

I must've missed those parts. I'd appreciate it if you would point them out to me

>>16297494
Every time I try to read about economics I just get bored

>>16299487
This argument is correct on the surface. Different types of goods have different potentials for innovation and generate different long-term patterns of growt. Depending on which tradeble goods a country specializes in, their balance of payments can become specially vulnerable to changes in the pattern of short-term capital movements. In this case the balance of payments acts as a barrier to economic progress and the interest rate becomes completely subjected to the state of the global economy. Democracy becomes a time bomb (in more ways than it usually is) because any disturbance to the markets can create a gigantic crisis.
The fact is that most rich countries developed their productive forces not while they disregarded intelectual property, but because of it. Developed countries use multilateral institutions such as the WTO to subject third world countries to some sort of eternal economic dependency.

>>16299595
>guys, I am a Marxist and I say nigger too, I'm so quirky and twisted HAHAHA FUCKING NIGGERS XD

>>16297494
OP, since you managed to go all the way, answer me this: (1) Does the book ever acknowledges or explains where does money comes from? (2) Does it talk about the whole of central banks in the economy? Thanks.

>>16299539
Like I said the labour theory of value (from Smith to Marx) was only a theory about long run income distribution under laissez faire capitalism. It doesn't really have anything to contribute to socialist economics. If it is "wrong" or not doesn't really matter to anyone but dogmatic Marxists. You can "have" socialism on the basis of marginalism, in fact you have to abandon the labour theory if you want to have socialism.

>>16299529
Ya, to justify more markets. The entire concept of externalities is problematic since most supposed "externalities" are really just cost shifting and there's little proof private investment is good at fixing problems caused by private investment.

>>16298533
>If Sowell was right you could of made a killing betting against the Japanese government bond market for over the past decade.

Finally someone who actually knows a thing or two...

>>16299615
No historically-educated person would use the same reductionist logic Chang does
Fucker unironically needs to read the Arab
Economies too are causally heavy for any of his arguements to make any sense

>>16299695
Nigger what?
How would the Marxist understanding of exploitation or its historical narrative work without the LtV
You do know socialism is not just
>Communism is when the guberment das staf

>>16299776
I seriously can’t believe you can be this fucking stupid

>>16299776
that poster doesn't understand what socialism is

>>16299683

He has a whole chapter on money and the banking system. Off the top of my head he talks about the role of money being an agreed upon intermediary for the transfer of wealth. He also covers the role of banks as not only managing money, but managing risk as well.

>>16299776
Even without a theory of income determination you can still claim class struggle is central. You're right though the Marxist theory of exploitation doesn't exactly work without the labour theory but it's not like that's the only theory that matters, you don't even need sophisticated macroeconomics to get that people get screwed over a lot.
Also socialism is just some form of common ownership (maybe under worker management). Wages and such would still exist (maybe some form of public dividend or something) but aggregate investment decisions wouldn't be as dominated by private shareholders interests. You could go really Marxist and just outlaw selling labour time altogether and see what happens... obviously the government could do that since they criminalize selling drugs and such. Without the ability to sell your time some interesting arrangement could develop maybe or not.

>>16299839
He's an old school monetarist who thinks the central bank controls the money supply. He has no clue at all how banking works.

>>16297494
Good follow up book is “Road to Serfdom”

>>16297521
Imagine fucking actually finally reading Sowell and coming to the conclusion that he is extremely biased, holy shit.
He speaks plenty about where in society government can do better than the masses, generally military and other forms security, things which a government would naturally need control over to exist in the first place.
Secondly on your idea of bias; Sowell presents very few opinions, at least in his own mind. His conclusions are derived from the perspective of viewing massive amounts of complementary data and outcomes throughout history which form a narrative or logic about that environment. It's a form of analytical conclusion making derived from empiricism rather than a conclusion derived from rationality or logic. If there is any real bias in Sowell's writing, it is towards utilizing history as a decision making tool for the present and the future, whilst ignoring sentiments or rationalizations which might seem "correct" on the surface to the uninformed.
The only valid counter arguments to Sowell must function within that same conclusion-deriving framework, and for practically everything in basic economics, there are none. The only people who might argue that minimum wage and rent control helps poor people are those which either do not know or do not care about the statistical facts and history of such policies throughout the world. This person could not be called an economist by any verifiable or accountable definition, and if you consider that form of conclusion making to be valuable in the first place (i.e. derived from what sounds valid rather than what is proven to be valid through empiricism), then you're a fucking moron and you missed half the point of the book.
Read more Sowell until you get it. Intellectuals and Society is pretty good.

This thread is ignorant and really shitty. I'm sorry OP that your thread fundamentally about introductory level studies attracted a bunch of posters who don't even know the introductory functions of the discussion.


You'd think the economic experts of the free market would have a better place to be on a sunday afternoon then shitposting in an economics 101 thread.

>>16299892
So you, a random 20 year old random virgin with cummed up pants, understand banking more than a then 50 year old acknowledged experienced economist?

>>16301518
>50 year old
Try 90

>>16301518
Yes. Anyone who empirically looks at how bank balance sheets work and thinks will quickly see what's wrong with the loanable funds model... regurgitating monetarism for over 40 years and never bothering to look at a balance sheet doesn't give you anymore qualifications.

>>16297494
Economic Facts and Fallacies is better.

>>16303222
How so? Not OP, but I haven't read that yet.

>>16298228
I wish you were right, nothing would make me happier

>>16297494
I’ve never read his books but have seen many of his interviews. His solutions seems so simple and logical, yet maybe too simple in the sense that he often disregards factors that are outside the control of the market. Am I wrong, or is fixing the economy and therefore society that easy?

>>16303647
Coordinating 7.8 billion people for even "simple" things is not "simple".

>>16303647
yes you stop printing money

>>16303647
Why don't you read his fucking book you moron. Conflict of Visions may be more relevant to the essence of your question, however.

>>16303769
I don’t have time desu. I’m in my last year of my PhD and all I’m doing right now is reading papers and spending my youth in a lab. I’ll get to it tho in a year or so.

>>16297798
>You'll learn a lot more about the real world from him than you will from Sowell.
kek

>>16303839
Fair enough, but to summarize, Sowell argues that honest interpretations of history, when viewed outside the lens of justifying prevailing preconceptions about the world, can allow us to learn more accurately what may work or not work within a given society in the present and future; that history and empirical data are not just abstract concepts with conclusions that may change based solely on the perspective with which they are viewed.
I think in this way it may seem that some of the solutions which he suggests, based on evidence and history, are so simple in their concept.
The muddying of logical discussion with political rhetoric, obfuscation of facts and history which do not fit within a prevailing vision of a specific era, and the inherent desire for humans to retain the mental framework with which they understand their world (sometimes at all logical costs), makes it appear as if history, facts, and logic derived from those history/facts are malleable entities. The idea that conclusions based on history and pre-existing empirical evidence about economics, race, culture, and politics, can change based just on which "sides" of the argument you begin on, is a dishonest interpretation of history. Honesty and logical integrity on the part of the researcher and historian is ultimately what he argues is the most important factor in preserving the meaning of history as a tool by which to prevent the pitfalls humanity has faced in the past.