Lexicus
Deity
I'm starting this thread as a 'colony' from a discussion in the Republican primary thread. It's an ongoing discussion about what's going on in the US economy and how to fix it.
I understood your argument the first time.
You are simply restating the theory of skill-biased technological change that was popular in the late 1990s to explain why some people saw their incomes stagnate even as productivity skyrocketed. This theory is in turn based on something called the 'marginal productivity theory of labor value,' which is less a theory and more an assumption that labor is paid an amount equal to what it adds to the productive process.
Whether you understand it or not that is the theoretical basis of what you are arguing. You are wrong; marginal productivity theory not only has never been empirically confirmed despite more than a hundred years' worth of attempts, it has been shown not to apply when the conventional assumptions of classical economics (rational actors with all relevant information, perfectly competitive markets) don't hold (which they obviously don't).
The distinction between skills or 'quwan' as you're now calling it (to avoid a semantic argument which never actually happened) and power is not irrelevant or arbitrary. As I implied, skills are only one part of an employee's power relative to his employer but many other things can affect that power balance as well that have nothing to do with skills - for example the general scarcity or abundance of labor in the economy, whether or not there is an active union in the workplace, etc.
Anyway, the 'skill-biased technological change' theory is long discredited, and for good reason. You should do some research on that yourself and see if it resembles what you're trying to argue.
You obviously do not, or you would not have said "there is plenty of demand, just not enough money." To anyone who understands the economics meaning of demand that statement makes no sense.
Metaphysical demand --> people don't want enough things
Economic demand --> people lack the money to buy the things they want
I came up with the phrase myself to apply to your, ah, idiosyncratic use of the term.
Again, the problem is not a lack of skills. There is nothing 'artificial' about increasing effective demand as a way of increasing economic activity. Please read your Keynes, or your Kalecki if you prefer.
We have that in common. However my "quibbles" had nothing to do with semantics.
Sommerswerd said:
I understood your argument the first time.
You are simply restating the theory of skill-biased technological change that was popular in the late 1990s to explain why some people saw their incomes stagnate even as productivity skyrocketed. This theory is in turn based on something called the 'marginal productivity theory of labor value,' which is less a theory and more an assumption that labor is paid an amount equal to what it adds to the productive process.
Whether you understand it or not that is the theoretical basis of what you are arguing. You are wrong; marginal productivity theory not only has never been empirically confirmed despite more than a hundred years' worth of attempts, it has been shown not to apply when the conventional assumptions of classical economics (rational actors with all relevant information, perfectly competitive markets) don't hold (which they obviously don't).
The distinction between skills or 'quwan' as you're now calling it (to avoid a semantic argument which never actually happened) and power is not irrelevant or arbitrary. As I implied, skills are only one part of an employee's power relative to his employer but many other things can affect that power balance as well that have nothing to do with skills - for example the general scarcity or abundance of labor in the economy, whether or not there is an active union in the workplace, etc.
Anyway, the 'skill-biased technological change' theory is long discredited, and for good reason. You should do some research on that yourself and see if it resembles what you're trying to argue.
Sommerswerd said:
You obviously do not, or you would not have said "there is plenty of demand, just not enough money." To anyone who understands the economics meaning of demand that statement makes no sense.
Sommerswerd said:
Metaphysical demand --> people don't want enough things
Economic demand --> people lack the money to buy the things they want
I came up with the phrase myself to apply to your, ah, idiosyncratic use of the term.
Sommerswerd said:
Again, the problem is not a lack of skills. There is nothing 'artificial' about increasing effective demand as a way of increasing economic activity. Please read your Keynes, or your Kalecki if you prefer.
Sommerswerd said:
We have that in common. However my "quibbles" had nothing to do with semantics.
