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I’d say that the western view of economics has taken over most of the world with minor variations here and there. That includes countries like China. I define

by jshen 5y ago

I’d say that the western view of economics has taken over most of the world with minor variations here and there. That includes countries like China. I define this view as an economy predicated on exponential (or superexponential) growth.

Jeff_Brown 5y ago
What parts of economics seem Western and not objective to you? Supply and demand? Game theory? Fractional reserve lending? The effects of monopoly? Of rent control? Of pollution taxes? Of immigration restrictions? I got a master's in economics. Everything in the textbooks is positive (what is, what happens) rather than normative (what should be). Individual professors have their individual beliefs regarding justice, of course, but those beliefs don't really constitute what economics is. Economics is a set of methods for anticipating how people will respond to incentives.
- jshen 5y ago
  That’s a deep question, I’ll try to answer later when I have time to do it justice. On the off chance I don’t, the book “Debt: The First 5000 Years” is pretty close to my view of it. Also, if you want a less “economics” view of it, I’d recommend “Scale” by Geoffrey West
- jshen 5y ago
  "What parts of economics seem Western and not objective to you?" I don't think the western part is relevant to the point I was making. I probably should have left it out. I was inartfully trying to point out that our current system has only existed for a small portion of human history, but most of us have internalized it so much that we can't imagine an alternative. Let's break down the other part of your question, and your last sentence. "What parts of economics seem ... not objective to you? ... Economics is a set of methods for anticipating how people will respond to incentives." I think this is the crux of our different perspectives. The current global economic system is one that creates incentives that are somewhat arbitrary. For example, the fact that economists freak out if a country like Japan stops increasing it's population exponentially. This is an incentive that the system we've chose, of many possible systems, has created some what arbitrarily. There is no law of nature or physics that forces exponential population growth, but our economic system as it stands is predicated on it. In fact, I would say it's quite the opposite, nature typically has constraints that stop exponential growth, but we've managed to break for of those constraints, at least for a limited time. My big fear is that it will only be for a limited time. A system based on superexponential growth requires infinite growth, to date that would require infinite resources. Maybe there is a way to break free of the physical constraints of growth (Ray Kurzweil's singularity), but I fear there is not and the arbitrary incentive of superexponential growth (or just exponential) will lead to very bad times ahead if we don't choose to change our current system. Now, maybe human psychology is incapable of changing in response to clear impending doom, and economics is simply a statement of this. Our response to the pandemic has not given me hope that human kind can adapt to clear approaching existential danger. I.e. will we cut down the entire rainforest and destroy our ecology before we have enough physical incentive to change? And again, I do believe that our current system which demands superexponential growth is an arbitrary incentive that we can choose to change.
  - Jeff_Brown 5y ago
    I agree almost completely. We certainly can't continue to be this voracious and expect happy times ahead. My only disagreement is in the concept of "the system". I mean, institutions are critically important, yes. But most of the system is just individual people doing their somewhat predictable thing. The major innovation of economics has been microfoundations -- our predictions come from what individuals are motivated to do by their circumstances and their personal values. The models economists use tend to attribute painfully simple values to people -- more often than not, simple personal greed and nothing else. The horror is that those models are accurate. Japan's a good example. What's so bad about the population loss in Japan? It's that the society is used to having more on a per-person basis than it can now expect to have. What's a government to do? Reduce pension amounts? Increase ages of retirement? Replace the shrinking hospital staff, not to mention the once-abundant family that used to visit their elders, with robots? Whatever they choose, the people will be really unhappy.
    - jshen 5y ago
      Yeah, I think we mostly agree, but we do have this one small disagreement. If I understand you correctly, you are saying that human nature naturally leads to a system that demands superexponential growth. Let me know if I'm misunderstanding. I don't think this is the case, but I could be wrong. The case I'll make is that many societies were going along just fine without a system like this, many for longer than this current system has existed before colonial powers invaded them (or missionaires "converted them) and imposed this system. I just got back from Hawaii, so I have the pacific islands on my mind. Their societies before european powers reached them were very very different, and human nature hadn't led to the same system with the same incentives. Our current system may be more akin to cancer, it starts in one small place then grows uncontrolled until it ultimately takes over everything and kills itself. Edit: having said that, I don't think we have to end up in this dire place, but it will require us to end the incentive of superexponential growth which I don't believe is some kind of law of physics that we can't change. To steal of Geoffrey West, we need a unified theory of sustainability.
      - 5y ago

by jshen 5y ago

Jeff_Brown 5y ago

What parts of economics seem Western and not objective to you? Supply and demand? Game theory? Fractional reserve lending? The effects of monopoly? Of rent control? Of pollution taxes? Of immigration restrictions? I got a master's in economics. Everything in the textbooks is positive (what is, what happens) rather than normative (what should be). Individual professors have their individual beliefs regarding justice, of course, but those beliefs don't really constitute what economics is. Economics is a set of methods for anticipating how people will respond to incentives.

jshen 5y ago
That’s a deep question, I’ll try to answer later when I have time to do it justice. On the off chance I don’t, the book “Debt: The First 5000 Years” is pretty close to my view of it. Also, if you want a less “economics” view of it, I’d recommend “Scale” by Geoffrey West
jshen 5y ago
"What parts of economics seem Western and not objective to you?" I don't think the western part is relevant to the point I was making. I probably should have left it out. I was inartfully trying to point out that our current system has only existed for a small portion of human history, but most of us have internalized it so much that we can't imagine an alternative. Let's break down the other part of your question, and your last sentence. "What parts of economics seem ... not objective to you? ... Economics is a set of methods for anticipating how people will respond to incentives." I think this is the crux of our different perspectives. The current global economic system is one that creates incentives that are somewhat arbitrary. For example, the fact that economists freak out if a country like Japan stops increasing it's population exponentially. This is an incentive that the system we've chose, of many possible systems, has created some what arbitrarily. There is no law of nature or physics that forces exponential population growth, but our economic system as it stands is predicated on it. In fact, I would say it's quite the opposite, nature typically has constraints that stop exponential growth, but we've managed to break for of those constraints, at least for a limited time. My big fear is that it will only be for a limited time. A system based on superexponential growth requires infinite growth, to date that would require infinite resources. Maybe there is a way to break free of the physical constraints of growth (Ray Kurzweil's singularity), but I fear there is not and the arbitrary incentive of superexponential growth (or just exponential) will lead to very bad times ahead if we don't choose to change our current system. Now, maybe human psychology is incapable of changing in response to clear impending doom, and economics is simply a statement of this. Our response to the pandemic has not given me hope that human kind can adapt to clear approaching existential danger. I.e. will we cut down the entire rainforest and destroy our ecology before we have enough physical incentive to change? And again, I do believe that our current system which demands superexponential growth is an arbitrary incentive that we can choose to change.
- Jeff_Brown 5y ago
  I agree almost completely. We certainly can't continue to be this voracious and expect happy times ahead. My only disagreement is in the concept of "the system". I mean, institutions are critically important, yes. But most of the system is just individual people doing their somewhat predictable thing. The major innovation of economics has been microfoundations -- our predictions come from what individuals are motivated to do by their circumstances and their personal values. The models economists use tend to attribute painfully simple values to people -- more often than not, simple personal greed and nothing else. The horror is that those models are accurate. Japan's a good example. What's so bad about the population loss in Japan? It's that the society is used to having more on a per-person basis than it can now expect to have. What's a government to do? Reduce pension amounts? Increase ages of retirement? Replace the shrinking hospital staff, not to mention the once-abundant family that used to visit their elders, with robots? Whatever they choose, the people will be really unhappy.
  - jshen 5y ago
    Yeah, I think we mostly agree, but we do have this one small disagreement. If I understand you correctly, you are saying that human nature naturally leads to a system that demands superexponential growth. Let me know if I'm misunderstanding. I don't think this is the case, but I could be wrong. The case I'll make is that many societies were going along just fine without a system like this, many for longer than this current system has existed before colonial powers invaded them (or missionaires "converted them) and imposed this system. I just got back from Hawaii, so I have the pacific islands on my mind. Their societies before european powers reached them were very very different, and human nature hadn't led to the same system with the same incentives. Our current system may be more akin to cancer, it starts in one small place then grows uncontrolled until it ultimately takes over everything and kills itself. Edit: having said that, I don't think we have to end up in this dire place, but it will require us to end the incentive of superexponential growth which I don't believe is some kind of law of physics that we can't change. To steal of Geoffrey West, we need a unified theory of sustainability.
    - 5y ago