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Economists don't generally buy the buy idea that you can make some people better off without making others worse off. In short, if all the gains happen for one

Economists don't generally buy the buy idea that you can make some people better off without making others worse off. In short, if all the gains happen for one group, even if the other group isn't directly losing money, their purchasing power will be eroded by the rich. And I'll add that this sort of thing keeps stacking up, because as the rich continue to be able to buy up things like land at a higher rate than the poor, the rich are then able to extract even more money from the poor through rents.

logicchains 9y ago
>Economists don't generally buy the buy idea that you can make some people better off without making others worse off. Which economists? Economists generally support freer trade, more open borders and the like because they see trade as fundamentally not a zero sum game: if two parties are willing to make an exchange, it must be because the exchange somehow makes them better off than they would be without it. All of developmental economics is built on this: it's why the majority of the world's population enjoy an incredibly greater standard of living than they did 100 years ago. Everyone is better off. Which is not to say there aren't situations where economists recognise trade-offs. For example, https://en.wikipedia.org/wiki/Factor_price_equalization https://en.wikipedia.org/wiki/Factor_price_equalization: a commonly accepted economic theory that proposes that international trade between poorer and richer countries will make unskilled wages in the poorer countries higher and in the richer countries lower.
- mcguire 9y ago
  http://www.oecd.org/social/in-it-together-why-less-inequality-benefits-all-9789264235120-en.htm http://www.oecd.org/social/in-it-together-why-less-inequalit... "This long-run increase in income inequality not only raises social and political concerns, but also economic ones. It tends to drag down GDP growth, due to the rising distance of the lower 40% from the rest of society. Lower income people have been prevented from realising their human capital potential, which is bad for the economy as a whole." " Causes and Consequences of Income Inequality: A Global Perspective", from the IMF. "First, we show why policymakers need to focus on the poor and the middle class. Earlier IMF work has shown that income inequality matters for growth and its sustainability. Our analysis suggests that the income distribution itself matters for growth as well. Specifically, if the income share of the top 20 percent (the rich) increases, then GDP growth actually declines over the medium term, suggesting that the benefits do not trickle down. In contrast, an increase in the income share of the bottom 20 percent (the poor) is associated with higher GDP growth. The poor and the middle class matter the most for growth via a number of interrelated economic, social, and political channels."
- peatmoss 9y ago
  Economists familiar with Arthur Pigou. And here I'll point out that there's a difference between economists with a relatively complete grounding in modern economic theory, and the politicians engaged in economic policy.

logicchains 9y ago

>Economists don't generally buy the buy idea that you can make some people better off without making others worse off. Which economists? Economists generally support freer trade, more open borders and the like because they see trade as fundamentally not a zero sum game: if two parties are willing to make an exchange, it must be because the exchange somehow makes them better off than they would be without it. All of developmental economics is built on this: it's why the majority of the world's population enjoy an incredibly greater standard of living than they did 100 years ago. Everyone is better off. Which is not to say there aren't situations where economists recognise trade-offs. For example, https://en.wikipedia.org/wiki/Factor_price_equalization https://en.wikipedia.org/wiki/Factor_price_equalization: a commonly accepted economic theory that proposes that international trade between poorer and richer countries will make unskilled wages in the poorer countries higher and in the richer countries lower.

mcguire 9y ago
http://www.oecd.org/social/in-it-together-why-less-inequality-benefits-all-9789264235120-en.htm http://www.oecd.org/social/in-it-together-why-less-inequalit... "This long-run increase in income inequality not only raises social and political concerns, but also economic ones. It tends to drag down GDP growth, due to the rising distance of the lower 40% from the rest of society. Lower income people have been prevented from realising their human capital potential, which is bad for the economy as a whole." " Causes and Consequences of Income Inequality: A Global Perspective", from the IMF. "First, we show why policymakers need to focus on the poor and the middle class. Earlier IMF work has shown that income inequality matters for growth and its sustainability. Our analysis suggests that the income distribution itself matters for growth as well. Specifically, if the income share of the top 20 percent (the rich) increases, then GDP growth actually declines over the medium term, suggesting that the benefits do not trickle down. In contrast, an increase in the income share of the bottom 20 percent (the poor) is associated with higher GDP growth. The poor and the middle class matter the most for growth via a number of interrelated economic, social, and political channels."
peatmoss 9y ago
Economists familiar with Arthur Pigou. And here I'll point out that there's a difference between economists with a relatively complete grounding in modern economic theory, and the politicians engaged in economic policy.