16 ms·

There is a popular political perspective that rules on campus these days that treats wealth as something that just magically exists and is simply "redistributed

by SiVal 7y ago

There is a popular political perspective that rules on campus these days that treats wealth as something that just magically exists and is simply "redistributed" by one means or another like, say, a phase change in physics where no magnetism/charge/energy/etc. is ever created or consumed. I waited for a point in their model where people actually produced wealth and consumed it, made something or ate it, in addition to redistributing it. Not part of the model. And the idea that things have a "true" value, the one put on them by enlightened campus philosophers, so a transaction not controlled by the wise and just will have a winner and a loser. I waited for the idea that I, shoeless but with ten loaves of bread, and you, hungry but with ten pairs of shoes, might reasonably value bread and shoes differently and BOTH win from the "redistribution" of bread and shoes, but it was not part of the model. But their model (which they claim "reproduces inequality with unprecedented accuracy") could also (they claim) be fitted to a variety of different observed power law distributions when its parameters were adjusted, and the more parameters, the better the fit became. Yes, and they could probably get their model to describe the frequency distribution of English vocabulary (also a power law), with remarkable accuracy which probably does say something about economics but maybe not as much as they seem to think.

deleted 7y ago
[deleted]
tasubotadas 7y ago
This will go in my "Hacker News Wisdom" folder for the future quoting :)
murftown 7y ago
Totally agree that wealth creation is a thing distinct from distribution, and that it matters. However, I'm not aware of any metrics or markers for wealth creation - other than revenue / profit. So in other words, most of our attempts to study economics ignore this, just like the model in TFA. They look at successful businesses and growing GDP and infer that wealth must have been created. Another related concept - similarly murky and unaccounted for - is wealth destruction. If wealth is defined, say, as the capacity for people to live a good life, then how often is this capacity destroyed in the pursuit of growing business? We similarly have no markers for this factor in most of our economic models that I'm aware of.
taneq 7y ago
> I waited for a point in their model where people actually produced wealth and consumed it, made something or ate it, in addition to redistributing it. Not part of the model. That’s because the people making the models don’t create wealth and don’t really understand where it comes from. It’s like the way you see Marxists saying “seize the means of production” but never “build the means of production”.
- WilliamEdward 7y ago
  Not so sure you understand what means of production are. You cannot build more means of production without having access to means of production in the first place, hence the 'seizing' part.
  - kortilla 7y ago
    Yet all of the modern means of production stemmed from no means of production... hmmm. People create all of the time with extremely limited resources. Especially ones that haven’t been seized.
    - pmiller2 7y ago
      How would you go about building your own means of production for creating modern computers?
      - taneq 7y ago
        It took a large part of modern industry working cooperatively for decades to build the tooling to make ICs. If your commune wants to make a similar effort then there’s nothing stopping you. If you don’t then you’re not entitled to own a chip fab.
        tsimionescu 7y ago
        Why is anyone entitled to own a chip fab? Why is some rich daughter entitled to own a chip fab? Because she is in the current system, while anyone else would have to work their whole lives, and convince hundreds of others to work with them, to create a chip fab, if they wanted to own one.
ihm 7y ago
I don't think your comment is a good faith engagement with leftist understandings of value. This is the starting point of Marx's whole theory of capitalism (it's in the first few chapters of Capital) which is the labor theory of value. Namely, his starting point is that labor is identified with value. Wealth is created when raw materials and the means of production are combined with labor. In the capitalist theory of value in contrast, one's legal right (inherited or otherwise) is one of the things which is identified with value. It's not a claim that this value is something metaphysical, just a political assertion that this is what we ought to think of as "value". It's all about what you want to consider as the primary "cost" in production. This has been refined over the years. I'm not an expert so I may not be able to respond to any and all criticisms but I will try my best.
- WalterBright 7y ago
  > his starting point is that labor is identified with value This is a large mistake. For example, spending an hour on an exercise bike is certainly a lot of labor input, but nothing of value, since nobody will pay you to cycle on an exercise bike.
  - tremon 7y ago
    You're making a large mistake too. For example, that nobody will pay you to cycle on an exercise bike does not mean your labor has no value -- after all, if you're in better health, you will be more productive in the hours you're not on that bike. (to make my point more explicit: in Marx' definition of labor he implies labor of enterprise, not just spending calories. Just like your definition of value implies financial value, not just any positive outcome. I'm purposefully misrepresenting your definition of value just like you're purposefully misrepresenting Marx' definition of labor.)
    - WalterBright 7y ago
      > Just like your definition of value implies financial value When the discussion is about economics, that's what matters. There is no intrinsic value to labor. > Marx' definition of labor he implies labor of enterprise The economic value of labor has no necessary relationship at all to the effort or time supplied by the laborer. If Bob works inefficiently, his labor is worth less than Bill who works efficiently, even if they both work exactly the same length and effort.
wuliwong 7y ago
I received a Ph.D. in physics in 2010, throughout my training, my anecdotal experience was that of an echo chamber. I didn't fully realize it until I left academia. Although, it was slowly becoming apparent as the years passed. My experience was of a relatively small and closed group of physicists who reaffirmed each other's assumption that they were at the absolute peak of intellectual thought. Most of the professors imparted this mindset onto their graduate students and post docs. It fits pretty well with my experience that physicists would ignore the history of economic thought and believe that they could create a simple model that would accomplish what economists and philosophers have been hitherto unable to in the prior thousand years. But economics (or praxeology to be more general) is not physics. And a simple model of coin flips with random pairings and one risk limiting function isn't economics. When you have such hubris and make such simple mistakes as to assume that value is objective, it should be embarrassing. ------- I will add that I still am a physicist who likes to think about things like this. One addition I would make to the model is that the poorer a person is the larger a percentage they are willing to risk. It still doesn't get around the fact that this whole model is based around the fallacy of object value but I like playing with models.
- chewz 7y ago
  > the poorer a person is the larger a percentage they are willing to risk Utility function is logaritmic.
  - duxut_staglatz 7y ago
    Is there any evidence that it is?
    - chewz 7y ago
      Pretty common assumption. [1] The need for money saturates slowly. Think about winning 1000 dollars (nice dinner pehaps), 10 000 (better car), 100 000 (larger appartment), .... , 10 000 000. At some point it doesn't matter if its 200 000 000 or 300 000 000. On the other hand a lotter ticket is 1$. What is the utility of 1$ - a can of coke pehaps. But the perspective of winning $1 000 000 - thats a nice idea to hold for a few days... So many people do despite the slim chances. [] https://economics.stackexchange.com/questions/23952/is-the-utility-of-money-actually-logarithmic https://economics.stackexchange.com/questions/23952/is-the-u... [] https://www.forbes.com/sites/rogerkay/2013/08/05/how-the-marginal-utility-of-money-balances-with-value/ https://www.forbes.com/sites/rogerkay/2013/08/05/how-the-mar...
0-_-0 7y ago
As John von Neumann said: "With four parameters I can fit an elephant, and with five I can make him wiggle his trunk."
- deehouie 7y ago
  You probably misunderstood what they're doing. They are not fitting data with a model; that's what economists and statisticians do. They show that a simple mechanism, with very few assumptions about real world behavior could reproduce a remarkably realistic phenomenon.
  - duxut_staglatz 7y ago
    It is very similar to what economists do, I am not sure where you find a difference.
TomMckenny 7y ago
There is no philosopher involved, in this case there is the wealth expended to produce an item. In your idealized example both parties are better off but the one that traded the item and took less effort to make it is comparatively better off. He will have advantages in future trades which will further increase. Not to mention a bigger voice in societal structure. (which is a tldr; of the article) Anecdotally you met some college kids whom you perceived as not understanding economics. But the knowledge of increasing wealth inequality and the current deficiency of private investment is uncontroversial. Regardless of what the impression those kids gave, there number of techniques to address it and _increase_ GDP through the stimulus.
- roenxi 7y ago
  Increasing the GDP is really easy, the government can pass a law adding a zero to all measures of money (so $10 becomes $100). Reducing inequality is also easy, confiscate people's wealth. The real problem is "people are not secure in their lifestyle" which is not addressed by the first solution and is probably exacerbated by the second. People getting antsy about inequality as a final problem instead of a symptom of another issue are not going to find their way to solutions that increase prosperity.
  - TomMckenny 7y ago
    How would printing money improve the GDP anymore than just lying about the figures? And since no one is suggesting that, I think it's kind of a straw-man. But surely these can't seriously be the best rebuttals to the paper: that straw-man, anecdotal opinion about college campuses and physics professors and a statistics joke about, but certainly not refuting, the elephant curve. I really can't tell if these arguments are genuinely considered valid or is this just a semi-polite troll technique to shout down unpleasant information.
    - roenxi 7y ago
      The GDP would be 10 times higher. It wouldn't be a lie. If the government wasn't completely blatant about it maybe store owners would only raise their prices by 9.95x and there might be a real GDP boost as well. Is it stupid? Yes. Is it a straw man? Not so much compared to what is done in practice. When people seriously say that the policy is to "stimulate the economy" they mean incentivising people to consume rather than save. This has a positive effect on the economic figures but it is madness to believe it is setting up a better future; because setting up for a better future generally involves saving in the present. > And since no one is suggesting that... I haven't seen anyone propose a plan to tackle wealth inequality that doesn't involve confiscation and redistribution of some form or another. The argument is over whether that is appropriate or not. As for GDP it is generally accepted that setting up a free market and leaving it alone maximises the GDP. There is lively debate about whether than is the best outcome. There is a serious argument that lower-than-maximum GDP with resource redistribution to the poor is better - which is what happens in practice. > certainly not refuting, the elephant curve There is nothing to refute. Inequality is not a problem - people can't even detect inequality! Nobody has a gut feel for it and the average level of mathematical intuition isn't high enough to understand the charts. Certainly people can't suffer because someone else has it really easy. People suffer when their lifestyles deteriorate and we should be focused on preventing that. That is a completely different problem and one that actually deserves attention. The living standards of poor and middle class people is a real and ongoing issue that should be focused on. It does not matter if dealing with that makes the rich ricer. And in that context, the elephant curve can reasonably be interpreted as a massive success story that we can all be proud of as millions are lifted up to a better standard of living.
chongli 7y ago
The Earth has finite resources: finite land, finite minerals, finite water, finite energy. When people accumulate vast amounts of wealth, they place a large portion of these finite resources under their own control. If we allow people and families to accumulate wealth indefinitely, it’s not hard to imagine a future whereby a very small elite control a vast majority of the resources. In this future, people can still create wealth by mixing their labour with raw resources... as long as they can afford to pay the rent to the rentier class.
- pasquinelli 7y ago
  That's a fair description of the past too.
  - chongli 7y ago
    At no time in the past were we in danger of reaching the limits of our planetary resources. There was always somewhere else to go, some other resources untapped. In the future that will no longer be the case, unless we manage to settle among the stars. Past performance does not guarantee future results. The story of our society was not written with a fairytale ending. Whether we succeed and create a better future for all or destroy ourselves or create a hellish dystopia, there are no guarantees.
    - jlawson 7y ago
      Medieval and previous people were always at the limits of the resources they had the technology to access. The past was a Malthusian world. No economic growth and no population growth for thousands of years, in a world without birth control. The difference was paid by death. This is life when you're at ecological carrying capacity. We managed to find new ways to tap resources better, more efficiently, deeper, and so on, so we revealed new carrying capacity which we haven't reached yet. If we don't advance again the way we did before, a return the Malthusianism is possible. That should be your null hypothesis. However, spreading past Earth or transcending to entirely new ways of existing (e.g. computational life) are also possible. The future resists past-based analysis because the rules are always changing. But there's no reason in principle that we can't tap extraplanetary resources, any more than a Roman-era tribe in Britain couldn't pump for oil in Texas. It just took a lot of steps to get there.
ajross 7y ago
That seems like a giant strawman to me. What "enlightened campus philosphers" (or "the wise", if those people are different) specifically are you arguing with? Does it include any actual academic economists? I mean, you're talking about stuff that sounds specific, but for the life of me I can't see exactly what opinions you're arguing against. Inequality isn't magic. It goes up and down in response to both economic cycles and public policy. It's been set all all sorts of levels over history, and right now is at a post-industrial zenith and getting higher rapidly. And some of us think that's bad, for reasons of simple fairness. And lots of actual academics agree with this, and have pretty solid numerate arguments that might convince you if you were willing to read them.
- deleted 7y ago
  [deleted]
notJim 7y ago
It seems like a huge distraction to claim that this study is somehow an exemplar of problems on "campuses." There are apparently 1.6 million faculty on campuses and 76 million students [hastily-googled statistics], so to claim that they have uniform beliefs about the nature of the economy seems like an extraordinary claim to make, which I'd like to see substantiated more than this.
- nine_k 7y ago
  I suspect that beliefs are also distributed non-uniformly, and 1-2 beliefs dominate the discourse, while the widely varied rest is seen as minority / fringe.
  - bhupy 7y ago
    You could argue that the distribution of beliefs is so uneven as to be almost oligarchic. :)
WalterBright 7y ago
> I, shoeless but with ten loaves of bread, and you, hungry but with ten pairs of shoes Even if I and you were equally skilled at making both bread and shoes, by economies of scale we can produce more bread and shoes if we specialize. Thereby, the use of trading makes us both better off. The invention of trade, and inventions that facilitate trade (money, banking, stock markets, contracts, property rights), have greatly benefited humanity.
vannevar 7y ago
It's not part of the model because, if you're studying how wealth gets distributed rather than how it is produced, it doesn't matter. I'm guessing that your disquiet at this notion comes from the possibility that everyone is creating their own wealth, and to some extent that is no doubt true. But if you start with the simplifying assumption that everyone's wealth creation ability is equal, and you just look at distribution, and you find that your model pretty accurately reproduces the real-world distribution of wealth, it's at least some evidence that wealth-creation ability is not that different from person to person, and what's driving inequality is the distribution mechanism. Since virtually all human traits follow a Gaussian distribution, it seems like whatever the wealth-building factor is, it would also follow a Gaussian distribution. But wealth follows more of a power law distribution. You never encounter anyone 1000 times taller than average, but there are many people 1000 times wealthier than average. This casts some doubt that wealth accumulation is down to individual human ability. Couple that with the micro-economic observation that someone with 1 million dollars is astronomically more likely to make another million dollars than someone with 100 dollars, even if the two people are otherwise identical, and it seems pretty unlikely that wealth creation has much to do with the distribution we see.
- piokoch 7y ago
  I am not sure we can ignore wealth creators, surely they want to have an impact on wealth distribution, I can't imagine sane model that would just ignore this factor.
  - tremon 7y ago
    But then, what is a "wealth creator"? Is a teacher a wealth creator? Were the parents of Bill Gates wealth creators? Were Elon Musk in need of a heart transplant, would the surgeon performing it be a wealth creator? Would the heart donor be? Would the director of said hospital be one?
- username90 7y ago
  > someone with 1 million dollars is astronomically more likely to make another million dollars than someone with 100 dollars, even if the two people are otherwise identical I'm not sure this is correct, at least not on average. Take two average persons, give one of them a million dollar, then watch what their net income is the next 10 years. I'd bet that the one you gave a million dollars will have used up a large part of it thus having a huge net loss while the one you didn't give anything will still be roughly at zero. Edit: This study shows that people significantly reduce their income after winning the lottery, suggesting that there is a negative correlation between wealth and earnings given that everything else is the same. https://www.nber.org/papers/w21762.pdf https://www.nber.org/papers/w21762.pdf

by SiVal 7y ago

deleted 7y ago

[deleted]

tasubotadas 7y ago

This will go in my "Hacker News Wisdom" folder for the future quoting :)

murftown 7y ago

Totally agree that wealth creation is a thing distinct from distribution, and that it matters. However, I'm not aware of any metrics or markers for wealth creation - other than revenue / profit. So in other words, most of our attempts to study economics ignore this, just like the model in TFA. They look at successful businesses and growing GDP and infer that wealth must have been created. Another related concept - similarly murky and unaccounted for - is wealth destruction. If wealth is defined, say, as the capacity for people to live a good life, then how often is this capacity destroyed in the pursuit of growing business? We similarly have no markers for this factor in most of our economic models that I'm aware of.

taneq 7y ago

> I waited for a point in their model where people actually produced wealth and consumed it, made something or ate it, in addition to redistributing it. Not part of the model. That’s because the people making the models don’t create wealth and don’t really understand where it comes from. It’s like the way you see Marxists saying “seize the means of production” but never “build the means of production”.

WilliamEdward 7y ago
Not so sure you understand what means of production are. You cannot build more means of production without having access to means of production in the first place, hence the 'seizing' part.
- kortilla 7y ago
  Yet all of the modern means of production stemmed from no means of production... hmmm. People create all of the time with extremely limited resources. Especially ones that haven’t been seized.
  - pmiller2 7y ago
    How would you go about building your own means of production for creating modern computers?
    - taneq 7y ago
      It took a large part of modern industry working cooperatively for decades to build the tooling to make ICs. If your commune wants to make a similar effort then there’s nothing stopping you. If you don’t then you’re not entitled to own a chip fab.
      - tsimionescu 7y ago
        Why is anyone entitled to own a chip fab? Why is some rich daughter entitled to own a chip fab? Because she is in the current system, while anyone else would have to work their whole lives, and convince hundreds of others to work with them, to create a chip fab, if they wanted to own one.

ihm 7y ago

I don't think your comment is a good faith engagement with leftist understandings of value. This is the starting point of Marx's whole theory of capitalism (it's in the first few chapters of Capital) which is the labor theory of value. Namely, his starting point is that labor is identified with value. Wealth is created when raw materials and the means of production are combined with labor. In the capitalist theory of value in contrast, one's legal right (inherited or otherwise) is one of the things which is identified with value. It's not a claim that this value is something metaphysical, just a political assertion that this is what we ought to think of as "value". It's all about what you want to consider as the primary "cost" in production. This has been refined over the years. I'm not an expert so I may not be able to respond to any and all criticisms but I will try my best.

WalterBright 7y ago
> his starting point is that labor is identified with value This is a large mistake. For example, spending an hour on an exercise bike is certainly a lot of labor input, but nothing of value, since nobody will pay you to cycle on an exercise bike.
- tremon 7y ago
  You're making a large mistake too. For example, that nobody will pay you to cycle on an exercise bike does not mean your labor has no value -- after all, if you're in better health, you will be more productive in the hours you're not on that bike. (to make my point more explicit: in Marx' definition of labor he implies labor of enterprise, not just spending calories. Just like your definition of value implies financial value, not just any positive outcome. I'm purposefully misrepresenting your definition of value just like you're purposefully misrepresenting Marx' definition of labor.)
  - WalterBright 7y ago
    > Just like your definition of value implies financial value When the discussion is about economics, that's what matters. There is no intrinsic value to labor. > Marx' definition of labor he implies labor of enterprise The economic value of labor has no necessary relationship at all to the effort or time supplied by the laborer. If Bob works inefficiently, his labor is worth less than Bill who works efficiently, even if they both work exactly the same length and effort.

wuliwong 7y ago

I received a Ph.D. in physics in 2010, throughout my training, my anecdotal experience was that of an echo chamber. I didn't fully realize it until I left academia. Although, it was slowly becoming apparent as the years passed. My experience was of a relatively small and closed group of physicists who reaffirmed each other's assumption that they were at the absolute peak of intellectual thought. Most of the professors imparted this mindset onto their graduate students and post docs. It fits pretty well with my experience that physicists would ignore the history of economic thought and believe that they could create a simple model that would accomplish what economists and philosophers have been hitherto unable to in the prior thousand years. But economics (or praxeology to be more general) is not physics. And a simple model of coin flips with random pairings and one risk limiting function isn't economics. When you have such hubris and make such simple mistakes as to assume that value is objective, it should be embarrassing. ------- I will add that I still am a physicist who likes to think about things like this. One addition I would make to the model is that the poorer a person is the larger a percentage they are willing to risk. It still doesn't get around the fact that this whole model is based around the fallacy of object value but I like playing with models.

chewz 7y ago
> the poorer a person is the larger a percentage they are willing to risk Utility function is logaritmic.
- duxut_staglatz 7y ago
  Is there any evidence that it is?
  - chewz 7y ago
    Pretty common assumption. [1] The need for money saturates slowly. Think about winning 1000 dollars (nice dinner pehaps), 10 000 (better car), 100 000 (larger appartment), .... , 10 000 000. At some point it doesn't matter if its 200 000 000 or 300 000 000. On the other hand a lotter ticket is 1$. What is the utility of 1$ - a can of coke pehaps. But the perspective of winning $1 000 000 - thats a nice idea to hold for a few days... So many people do despite the slim chances. [] https://economics.stackexchange.com/questions/23952/is-the-utility-of-money-actually-logarithmic https://economics.stackexchange.com/questions/23952/is-the-u... [] https://www.forbes.com/sites/rogerkay/2013/08/05/how-the-marginal-utility-of-money-balances-with-value/ https://www.forbes.com/sites/rogerkay/2013/08/05/how-the-mar...

0-_-0 7y ago

As John von Neumann said: "With four parameters I can fit an elephant, and with five I can make him wiggle his trunk."

deehouie 7y ago
You probably misunderstood what they're doing. They are not fitting data with a model; that's what economists and statisticians do. They show that a simple mechanism, with very few assumptions about real world behavior could reproduce a remarkably realistic phenomenon.
- duxut_staglatz 7y ago
  It is very similar to what economists do, I am not sure where you find a difference.

TomMckenny 7y ago

There is no philosopher involved, in this case there is the wealth expended to produce an item. In your idealized example both parties are better off but the one that traded the item and took less effort to make it is comparatively better off. He will have advantages in future trades which will further increase. Not to mention a bigger voice in societal structure. (which is a tldr; of the article) Anecdotally you met some college kids whom you perceived as not understanding economics. But the knowledge of increasing wealth inequality and the current deficiency of private investment is uncontroversial. Regardless of what the impression those kids gave, there number of techniques to address it and _increase_ GDP through the stimulus.

roenxi 7y ago
Increasing the GDP is really easy, the government can pass a law adding a zero to all measures of money (so $10 becomes $100). Reducing inequality is also easy, confiscate people's wealth. The real problem is "people are not secure in their lifestyle" which is not addressed by the first solution and is probably exacerbated by the second. People getting antsy about inequality as a final problem instead of a symptom of another issue are not going to find their way to solutions that increase prosperity.
- TomMckenny 7y ago
  How would printing money improve the GDP anymore than just lying about the figures? And since no one is suggesting that, I think it's kind of a straw-man. But surely these can't seriously be the best rebuttals to the paper: that straw-man, anecdotal opinion about college campuses and physics professors and a statistics joke about, but certainly not refuting, the elephant curve. I really can't tell if these arguments are genuinely considered valid or is this just a semi-polite troll technique to shout down unpleasant information.
  - roenxi 7y ago
    The GDP would be 10 times higher. It wouldn't be a lie. If the government wasn't completely blatant about it maybe store owners would only raise their prices by 9.95x and there might be a real GDP boost as well. Is it stupid? Yes. Is it a straw man? Not so much compared to what is done in practice. When people seriously say that the policy is to "stimulate the economy" they mean incentivising people to consume rather than save. This has a positive effect on the economic figures but it is madness to believe it is setting up a better future; because setting up for a better future generally involves saving in the present. > And since no one is suggesting that... I haven't seen anyone propose a plan to tackle wealth inequality that doesn't involve confiscation and redistribution of some form or another. The argument is over whether that is appropriate or not. As for GDP it is generally accepted that setting up a free market and leaving it alone maximises the GDP. There is lively debate about whether than is the best outcome. There is a serious argument that lower-than-maximum GDP with resource redistribution to the poor is better - which is what happens in practice. > certainly not refuting, the elephant curve There is nothing to refute. Inequality is not a problem - people can't even detect inequality! Nobody has a gut feel for it and the average level of mathematical intuition isn't high enough to understand the charts. Certainly people can't suffer because someone else has it really easy. People suffer when their lifestyles deteriorate and we should be focused on preventing that. That is a completely different problem and one that actually deserves attention. The living standards of poor and middle class people is a real and ongoing issue that should be focused on. It does not matter if dealing with that makes the rich ricer. And in that context, the elephant curve can reasonably be interpreted as a massive success story that we can all be proud of as millions are lifted up to a better standard of living.

chongli 7y ago

The Earth has finite resources: finite land, finite minerals, finite water, finite energy. When people accumulate vast amounts of wealth, they place a large portion of these finite resources under their own control. If we allow people and families to accumulate wealth indefinitely, it’s not hard to imagine a future whereby a very small elite control a vast majority of the resources. In this future, people can still create wealth by mixing their labour with raw resources... as long as they can afford to pay the rent to the rentier class.

pasquinelli 7y ago
That's a fair description of the past too.
- chongli 7y ago
  At no time in the past were we in danger of reaching the limits of our planetary resources. There was always somewhere else to go, some other resources untapped. In the future that will no longer be the case, unless we manage to settle among the stars. Past performance does not guarantee future results. The story of our society was not written with a fairytale ending. Whether we succeed and create a better future for all or destroy ourselves or create a hellish dystopia, there are no guarantees.
  - jlawson 7y ago
    Medieval and previous people were always at the limits of the resources they had the technology to access. The past was a Malthusian world. No economic growth and no population growth for thousands of years, in a world without birth control. The difference was paid by death. This is life when you're at ecological carrying capacity. We managed to find new ways to tap resources better, more efficiently, deeper, and so on, so we revealed new carrying capacity which we haven't reached yet. If we don't advance again the way we did before, a return the Malthusianism is possible. That should be your null hypothesis. However, spreading past Earth or transcending to entirely new ways of existing (e.g. computational life) are also possible. The future resists past-based analysis because the rules are always changing. But there's no reason in principle that we can't tap extraplanetary resources, any more than a Roman-era tribe in Britain couldn't pump for oil in Texas. It just took a lot of steps to get there.

ajross 7y ago

That seems like a giant strawman to me. What "enlightened campus philosphers" (or "the wise", if those people are different) specifically are you arguing with? Does it include any actual academic economists? I mean, you're talking about stuff that sounds specific, but for the life of me I can't see exactly what opinions you're arguing against. Inequality isn't magic. It goes up and down in response to both economic cycles and public policy. It's been set all all sorts of levels over history, and right now is at a post-industrial zenith and getting higher rapidly. And some of us think that's bad, for reasons of simple fairness. And lots of actual academics agree with this, and have pretty solid numerate arguments that might convince you if you were willing to read them.

deleted 7y ago
[deleted]

notJim 7y ago

It seems like a huge distraction to claim that this study is somehow an exemplar of problems on "campuses." There are apparently 1.6 million faculty on campuses and 76 million students [hastily-googled statistics], so to claim that they have uniform beliefs about the nature of the economy seems like an extraordinary claim to make, which I'd like to see substantiated more than this.

nine_k 7y ago
I suspect that beliefs are also distributed non-uniformly, and 1-2 beliefs dominate the discourse, while the widely varied rest is seen as minority / fringe.
- bhupy 7y ago
  You could argue that the distribution of beliefs is so uneven as to be almost oligarchic. :)

WalterBright 7y ago

> I, shoeless but with ten loaves of bread, and you, hungry but with ten pairs of shoes Even if I and you were equally skilled at making both bread and shoes, by economies of scale we can produce more bread and shoes if we specialize. Thereby, the use of trading makes us both better off. The invention of trade, and inventions that facilitate trade (money, banking, stock markets, contracts, property rights), have greatly benefited humanity.

vannevar 7y ago

It's not part of the model because, if you're studying how wealth gets distributed rather than how it is produced, it doesn't matter. I'm guessing that your disquiet at this notion comes from the possibility that everyone is creating their own wealth, and to some extent that is no doubt true. But if you start with the simplifying assumption that everyone's wealth creation ability is equal, and you just look at distribution, and you find that your model pretty accurately reproduces the real-world distribution of wealth, it's at least some evidence that wealth-creation ability is not that different from person to person, and what's driving inequality is the distribution mechanism. Since virtually all human traits follow a Gaussian distribution, it seems like whatever the wealth-building factor is, it would also follow a Gaussian distribution. But wealth follows more of a power law distribution. You never encounter anyone 1000 times taller than average, but there are many people 1000 times wealthier than average. This casts some doubt that wealth accumulation is down to individual human ability. Couple that with the micro-economic observation that someone with 1 million dollars is astronomically more likely to make another million dollars than someone with 100 dollars, even if the two people are otherwise identical, and it seems pretty unlikely that wealth creation has much to do with the distribution we see.

piokoch 7y ago
I am not sure we can ignore wealth creators, surely they want to have an impact on wealth distribution, I can't imagine sane model that would just ignore this factor.
- tremon 7y ago
  But then, what is a "wealth creator"? Is a teacher a wealth creator? Were the parents of Bill Gates wealth creators? Were Elon Musk in need of a heart transplant, would the surgeon performing it be a wealth creator? Would the heart donor be? Would the director of said hospital be one?
username90 7y ago
> someone with 1 million dollars is astronomically more likely to make another million dollars than someone with 100 dollars, even if the two people are otherwise identical I'm not sure this is correct, at least not on average. Take two average persons, give one of them a million dollar, then watch what their net income is the next 10 years. I'd bet that the one you gave a million dollars will have used up a large part of it thus having a huge net loss while the one you didn't give anything will still be roughly at zero. Edit: This study shows that people significantly reduce their income after winning the lottery, suggesting that there is a negative correlation between wealth and earnings given that everything else is the same. https://www.nber.org/papers/w21762.pdf https://www.nber.org/papers/w21762.pdf