Archived posting to the Leica Users Group, 2011/03/12
[Author Prev] [Author Next] [Thread Prev] [Thread Next] [Author Index] [Topic Index] [Home] [Search]The cobb-douglas functional form is one of the neater things i learned in economics. http://en.wikipedia.org/wiki/Cobb-Douglas labor and capital are the two inputs in all of the models, sometimes land is added as the third factor. the two or three input factors have exponents less than one, which means that increases will yield marginally smaller improvements to total production. the get out of jail card is the total factor productivity term (TFP) which is associated with innovation, technology and so on. there are no limitations to the growth of TFP unlike the other inputs. the formulation of TFP within cobb-douglas is an illustration that economics is not the shuffling of resources from one person to another--value really does get created along the way. -rei On 03/12/2011 10:27 AM, George Lottermoser wrote: > On Mar 12, 2011, at 4:59 AM, FRANK DERNIE wrote: > >> What I do mean is that however much we want the service they >> provide we can not have it if our economy does not have a significant >> number of >> people in genuine wealth creating employment who are net tax contributors. > Frank, I do understand your underlying point re: net taxpayer. > Though I believe we must consider some fundamental systemic underpinnings. > Money = a medium of exchange as a measure of perceived value; nothing more > and nothing less. > Can't eat it. Can't build a house with it. It won't keep you warm > (unless you have very large quantities of small bills to burn). > >> Who are net contributors, from this perspective? > One could postulate that only the planet itself offers a NET contribution > to our existence: > Top soil, flora, fauna, minerals, water, oxygen, various forms of fuels, > etc. > > Let's assume that you, me and eight other naked human beings exist in this > eco-system. > Further let's assume that we agree to work together for our mutual > survival and propagation. > (yes - we have women among our tribe of 10). We begin to discuss our > "needs" > and agree on who will perform which tasks to accomplish our various goals > of: > building shelter, creating clothing for the coming winter, > gathering food, water and fuels, handle sanitation issues, etc. > everyone has role to play for our mutual benefit. > > "Who are net contributors, from this perspective? > Anyone who performs their assigned and accepted duties within the system. > > Now - what do we do when one of us wants to store and control "more" > food, water, and fuel than everyone else in the tribe? (s)he says it's a > good plan. > We won't have to run around looking for berries and hunting game each day. > So we come up with these beads (money). We bring our game, our buckets of > water, > our bushels of grain and receive beads. When we need a chicken we just > hand over some beads. > > The net contributors still remain: The planet; Those who hunt, gather, > build; > And now the one who stores and distributes resources. > The beads themselves do not contribute; > they function only as an agreed upon means of exchange and measure of > value. > > I think you know where this is going. The storage guy ends up with lots of > real and necessary > commodities; as well as a whole lot of beads; pretty soon he needs guards > to keep his stores safe; and several millennia later here we are. > > The "net" contributors still remain the planet, birds, bees, top soil, and > those who nurture it. > > We seem to have arrived at a point where we pretend the "net contributors" > are those who exploit, excessively profit from, and over value their own > worth in the system. > Some even imagine that the bead exchangers deserve 5,000,000 times the > quality of life > than the human beings who pick the food for the bead exchangers' table. > When the bead exchangers start gaming the ecosystem - we have serious > problems. > >> Artists, such as yourself, who create from almost nothing valuable art >> which >> people pay for. Anybody who takes a lump of clay and makes a brick, >> anybody who takes a sheet of >> steel and makes a washing machine, anybody who takes a pile of bricks and >> builds >> a house. > We certainly agree on what is of true "net" value in our society. > Though I will add to your list - Those who pickup my garbage, plow the > road in front of my home, > stand ready to put out a fire in the community, teach my children and > grandchildren, etc. > >> The payment received for all these efforts is taxed and is "new" money >> going into the tax pot. It is this "new" money that allows us to pay for >> other >> things, not the money which circulates into and out of the tax pot. This >> circulation keeps people in work but is unsustainable without the "new" >> money >> since the money will dry up otherwise. >> If nobody is making "new" money nobody can spend it. However much we >> thing we >> "need" something. > Here's where we may need a lot more, research, paper and time; > as it becomes conceptual and philosophical. > The term "new" money does not ring true for me; > though I can certainly accept "real added value." > We seem to lack a basic agreement on: > 1) levels of equity between all the tribe members > 2) who contributes to the common good of one another > 3) ownership of the ecosystem which supports us all > 4) the systems of storage and distribution of the fruits of our labor. > > At this point in time I observe a tiny minority of tribe members hoarding > the vast wealth of nations. > The vast majority of tribe members who played very important roles in > creating that stored wealth ask for fair distribution and circulation. > This discussion has been going on since the first granary was built and > the first coin minted. > An open discussion must include the concepts of greed, subservience, usury > practices, false pretenses, and many more. > > Bottom line - who is actually interested in building a "just society?" > > Regards, > George Lottermoser > george at imagist.com > http://www.imagist.com > http://www.imagist.com/blog > http://www.linkedin.com/in/imagist > > _______________________________________________ > Leica Users Group. > See http://leica-users.org/mailman/listinfo/lug for more information