Tuesday, December 7, 2010

Economics: Not just money

John had a professor at CMU back in the day, who was the best Economics professor ever, from the sounds of it. He pointed out that economics is not just about money. Wealth is not the only motivator that enters into people's decision-making processes!

His list of motivators were Truth, Wealth and Honor.
I have to get in touch with this guy at some point and have him lay it out for me. This is a much more complete list than the usual monetary view of economics.

Economics is the mechanics of the world. It is the science behind why we do the things we do, and the fools try to pretend that they can create
some math equation to explain it. It encompasses psychology, finance, land usage, etc.. The reality is, people are way more complicated than a math equation. Economic planning is futile! You would think after the equations fail for so long and the prediction so far off each month, that they would ditch the equations after a time, but they just keep juggling, modifying and recycling their equations and hoping it will work the next time around! Isn't this the definition of insanity?

The best planning a planning commission can do stops after they release the chains. The rest will be taken care of with laws of morality, and are not to be lifted even for the most elite of citizens. That is our greatest problem, the laws do not apply equally to all. Then when one of the 'exempt' gets caught, the rest of us get slapped with more laws that the 'exempt' will navigate around anyways.

Oh man, I totally took this one on a ranting tangent... I am very susceptible to tangents!
As F.A.Hayek has said, "The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design."


Economics Is Not Just About Money - Economics Is About Resources Of All Types

There is a common public misconception that Economics is about money and finance. This is absolutely not true. While there are certainly monetary elements present amid Economic Study, the discipline of Economics is about the best possible uses of resources of all types, whether they be land, labor, capital, time, technology, equipment, natural resources, or anything else. The terms supply and demand are familiar to us all.

**(While this is true, this article does not hit upon the totality of economics. It still is limited to efficiency as the major motivator of decision-making. Often times the dynamics of human relationships, religion and morality overrule a person's motivation to be efficient or financially better off, and play a much larger role in their decision-making process.)

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