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"Capitalism" is such a general term I find it hard to know what exactly you mean. A liberal or free markets based economy doesn't need growth at all. The proble
by jcfrei 9y ago
"Capitalism" is such a general term I find it hard to know what exactly you mean. A liberal or free markets based economy doesn't need growth at all. The problem is that a lot of companies and a lot of state-run institutions (pension funds, etc.) have had the default assumption that the economy will always be growing (mostly due to population increase). But that trend is now reversing in a lot of countries, where populations have started to shrink and societies as a whole (not just the economy) will need some time to adjust to this.
- staplers 9y agoThis is exactly why the de-facto monetary policy of 2% inflation needs to be rethought.
- AnimalMuppet 9y agoI'm not sure that the 2% inflation is related at all to population changes. It's a change in the value of money, not in the total supply of money.
- randomdata 9y agoBut at the same time value is the intersection of supply and demand. All else equal, an increase in the supply of money does decrease the value of money. Granted, all else is rarely equal.
- jcfrei 9y agoI don't know all the economic reasons for a 2% inflation rate. But one of them is to disincentivize the hoarding of currencies and making investments in assets like bonds, treasuries or equities more appealing. So you probably want some amount of inflation to always remain.
- erikpukinskis 9y agoCapital + ism - the idea that capital should govern the flow of all resources.
- thaumasiotes 9y agoWhat do you think the difference is between "capital" and "resources"?
- badosu 9y agoPerhaps a better term is that it's the ideology where 'capital' and 'resources' should flow through supply and demand with some additional rules such as private property and being able to organize into corporations.
- erikpukinskis 9y agoProperty law turns a resource into a resource with an owner, i.e. capital. The idea of property is the legal implementation of capitalism.
- deleted 9y ago[deleted]
- dredmorbius 9y ago"Capital" is generally defined as something like "productive output reserved for future productive capacity". See for example most of Schumpeter. "Resources" would be any factors of production. Traditionally these are land, labour, capital, and ... well, things vary, but "entrepreneurship" is what the page I'm looking at argues for: http://smallbusiness.chron.com/economic-definition-four-factors-production-3941.html http://smallbusiness.chron.com/economic-definition-four-fact... Answering your question: "capital" is a subset of "resources". "Resources" are a superset of "capital". The question of what ought to be considered as factors of production is ... an interesting one. The list largely comes from cost accounting, and economists picked the items which dominated the cost-accounting sheets, which was pretty much "labour". Capital and other elements were added later. Much of the foundations of this seems to come from Alexander Hamilton Church[1] Among the interesting alternative discussions I've run across of factors of production comes from Count Leo Tolstoy, in What Shall We Do Then: https://archive.org/stream/whatshallwedothe00tolsrich#page/100/mode/2up/search/factors+of+production https://archive.org/stream/whatshallwedothe00tolsrich#page/1... ________________________________ Notes: 1. And yes, there appears a possible connection to the other A.H.: https://en.wikipedia.org/wiki/Alexander_Hamilton_Church#cite_note-7 https://en.wikipedia.org/wiki/Alexander_Hamilton_Church#cite...