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The focus on rent is a good legacy of George's theory. However, I was quickly disappointed by the book that was linked. George was doing well critiquing previou
by sde 11y ago
The focus on rent is a good legacy of George's theory. However, I was quickly disappointed by the book that was linked. George was doing well critiquing previous economic theory that had separate theories of wages, rent, and profit. He showed instead that it must be that production = wages + rent + interest, as a formula that relates them and can be rearranged. Then in the next chapter, 12, he falls into a sort of absurdity about the nature of interest, where he claims interest exists because of natural increase, such as of bees or ageing wine, and wouldn't exist otherwise.
That's not an advanced enough theory of why there's interest on capital and the rate of it. It doesn't even seem quite sane, in comparison with the example of reasoning that he was setting and teaching up to that point. There should be some school of economics that promotes a George-like view of rent, but that isn't embarrassing when it comes to explaining capital and interest.
- djhn 11y agoGeorge is also fairly "antique" as far as macroeconomists go. It's not too much of an exaggeration that anything from before the ~1950's is consider little more than curiosities that illustrate progress of economics thought. For the most comprehensive book on the subject, see http://www.amazon.com/Modern-Macroeconomics-Origins-Development/dp/1845422082/ http://www.amazon.com/Modern-Macroeconomics-Origins-Developm...
- ScottBurson 11y ago> Then in the next chapter, 12, he falls into a sort of absurdity about the nature of interest Yes, I noticed that too. I'm not enough of an economist (obviously) to know what he should have said instead. It's a weakness, but I don't think it's fatal to his key point, which is that urban land values are socially created and should benefit society as a whole.