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I fear you're also conflating two things: money made and actual value produced. Suppose the trader is selling credit default swaps and helping cause a big fina

by gjm11 12y ago

I fear you're also conflating two things: money made and actual value produced. Suppose the trader is selling credit default swaps and helping cause a big financial crash, or the bulldozer operator is destroying acres of forest to clear the way for a tobacco plantation. What they do may be very valuable to the people paying them (and hence, if they're lucky, lucrative for them personally) but have substantially negative net value by any reasonable measure. So "amount of hard work" is at two removes from what (I think) really matters, namely amount of actual value produced.

atmosx 12y ago
+100
tomp 12y ago
So can the guy with the shovel. Ultimately, the concept of "actual value" can be defined as one of two things: money (for things that have value for an individual) and laws (for things that have value for the society, e.g. externalities). Simply said, the society values certain things (short-term profit, growth, cars, cheap food, human lives) more than others (long-term stability, the environment, clean air, rainforest, empty space). These sentiments change, but they change slowly, because we live in a democracy (and because people value social/cultural stability and safety). As far as the financial crisis is concerned, it's easy to say after the fact. Was Einstein's research net-negatively-valuable, because it resulted in the atomic bomb, or was it net-negatively-valuable, because it ended the war? Whenever there is innovation, there is a risk of the innovation resulting in something "bad". That doesn't mean that the value of research is negative. People are simply short-sighted and/or not smart enough to foresee bad consequences. Btw, I'm sure you're doing the same thing - consuming cheap electronic devices produced using non-recyclable rare resources by workers whose raising wages will (1) significantly increase pollution and (2) significantly increase their quality of life. Is that "good" or "bad"?
- Retric 12y ago
  Economists have long accepted that individuals and society have vary different short term costs and bennifits for the same activity. Abstractly it's the basis for having governments in the first place. But that's a long way from saying laws directly account for all known externality's. http://en.wikipedia.org/wiki/Externality http://en.wikipedia.org/wiki/Externality
  - whatevsbro 12y ago
    > Economists have long accepted that individuals and society have vary different short term costs and bennifits for the same activity. That makes no sense whatsoever. Individuals are human beings, societies consist of individuals. A society is just a concept, it does not act in any capacity. All action by humans is carried out by individuals, regardless of what organization they represent. No activity whatsoever is carried out by societies, because they can't. They're just concepts, after all. > Abstractly it's the basis for having governments in the first place. Considering the above, I guess it's now clear that we shouldn't have governments at all? I'm not trying to be snide or sarcastic. That is actually my position, but for other reasons. For starters, governments are based on coercion, and coercion is immoral. Hence, governments are immoral, and should not exist.
- wobbleblob 12y ago
  > So can the guy with the shovel. I was going to suggest a guy with a 50ct lighter and a jerrycan of gas, who is probably a more imminent threat to forests than the bulldozer operator.
- gjm11 12y ago
  For the avoidance of doubt, I wasn't attempting to say that traders and bulldozer drivers are bad people or that their jobs are bad in themselves. Sometimes traders bring about financial crises, but more often they keep the markets doing their (important) job efficiently. Sometimes bulldozer operators destroy beautiful or valuable things for someone's short-term gain, but more often they clear things out of the way so that newer better things can take their place. And, yes, sometimes people do things with terrible consequences even though they're sincerely and skilfully attempting to do the best they can -- though in the case of those credit default swaps that might be a difficult position to argue. My point was narrower: Unless you choose to define the value of an activity to be what someone gets paid for doing it, you will find that those two things diverge, sometimes badly. So measures of productivity (e.g., GDP) that just count how much people get paid are, at best, going to do a very imperfect job of capturing anyone's idea of what's worth while. Most likely there will be large systematic disagreements.
- whatevsbro 12y ago
  > Ultimately, the concept of "actual value" can be defined as one of two things: money Even when "money" refers to hyperinflated Zimbabwean dollars? No, it's clear those had no value. Value is subjective, by the way. You may value 50cent's music enough to buy it, and someone else may not. > laws (for things that have value for the society, e.g. externalities). Oh? Like all those countless laws that make running a legitimate business more difficult? Do those have value? -Well, in fact they do. They have value to the insiders of whatever cartel/skimming operations the laws support, by reducing or eliminating competition. But that's not what you imagined. The guy you responded to had the right idea, but he was talking about "wealth" - things of value that support the production of new value.
jacques_chester 12y ago
> I fear you're also conflating two things: money made and actual value produced. The problem is that the definition of "actual value" turns out to be devilishly difficult to pin down. There's no objective measure for it. Value is subjective. This is one of the central riddles of economics. But it's also why exchanges happen at all.
th3iedkid 12y ago
> but have substantially negative net value by any reasonable measure. if we were to go by entropy measures there is nothing we can do about it . So what is of value?

by gjm11 12y ago

atmosx 12y ago

+100

tomp 12y ago

So can the guy with the shovel. Ultimately, the concept of "actual value" can be defined as one of two things: money (for things that have value for an individual) and laws (for things that have value for the society, e.g. externalities). Simply said, the society values certain things (short-term profit, growth, cars, cheap food, human lives) more than others (long-term stability, the environment, clean air, rainforest, empty space). These sentiments change, but they change slowly, because we live in a democracy (and because people value social/cultural stability and safety). As far as the financial crisis is concerned, it's easy to say after the fact. Was Einstein's research net-negatively-valuable, because it resulted in the atomic bomb, or was it net-negatively-valuable, because it ended the war? Whenever there is innovation, there is a risk of the innovation resulting in something "bad". That doesn't mean that the value of research is negative. People are simply short-sighted and/or not smart enough to foresee bad consequences. Btw, I'm sure you're doing the same thing - consuming cheap electronic devices produced using non-recyclable rare resources by workers whose raising wages will (1) significantly increase pollution and (2) significantly increase their quality of life. Is that "good" or "bad"?

Retric 12y ago
Economists have long accepted that individuals and society have vary different short term costs and bennifits for the same activity. Abstractly it's the basis for having governments in the first place. But that's a long way from saying laws directly account for all known externality's. http://en.wikipedia.org/wiki/Externality http://en.wikipedia.org/wiki/Externality
- whatevsbro 12y ago
  > Economists have long accepted that individuals and society have vary different short term costs and bennifits for the same activity. That makes no sense whatsoever. Individuals are human beings, societies consist of individuals. A society is just a concept, it does not act in any capacity. All action by humans is carried out by individuals, regardless of what organization they represent. No activity whatsoever is carried out by societies, because they can't. They're just concepts, after all. > Abstractly it's the basis for having governments in the first place. Considering the above, I guess it's now clear that we shouldn't have governments at all? I'm not trying to be snide or sarcastic. That is actually my position, but for other reasons. For starters, governments are based on coercion, and coercion is immoral. Hence, governments are immoral, and should not exist.
wobbleblob 12y ago
> So can the guy with the shovel. I was going to suggest a guy with a 50ct lighter and a jerrycan of gas, who is probably a more imminent threat to forests than the bulldozer operator.
gjm11 12y ago
For the avoidance of doubt, I wasn't attempting to say that traders and bulldozer drivers are bad people or that their jobs are bad in themselves. Sometimes traders bring about financial crises, but more often they keep the markets doing their (important) job efficiently. Sometimes bulldozer operators destroy beautiful or valuable things for someone's short-term gain, but more often they clear things out of the way so that newer better things can take their place. And, yes, sometimes people do things with terrible consequences even though they're sincerely and skilfully attempting to do the best they can -- though in the case of those credit default swaps that might be a difficult position to argue. My point was narrower: Unless you choose to define the value of an activity to be what someone gets paid for doing it, you will find that those two things diverge, sometimes badly. So measures of productivity (e.g., GDP) that just count how much people get paid are, at best, going to do a very imperfect job of capturing anyone's idea of what's worth while. Most likely there will be large systematic disagreements.
whatevsbro 12y ago
> Ultimately, the concept of "actual value" can be defined as one of two things: money Even when "money" refers to hyperinflated Zimbabwean dollars? No, it's clear those had no value. Value is subjective, by the way. You may value 50cent's music enough to buy it, and someone else may not. > laws (for things that have value for the society, e.g. externalities). Oh? Like all those countless laws that make running a legitimate business more difficult? Do those have value? -Well, in fact they do. They have value to the insiders of whatever cartel/skimming operations the laws support, by reducing or eliminating competition. But that's not what you imagined. The guy you responded to had the right idea, but he was talking about "wealth" - things of value that support the production of new value.

jacques_chester 12y ago

> I fear you're also conflating two things: money made and actual value produced. The problem is that the definition of "actual value" turns out to be devilishly difficult to pin down. There's no objective measure for it. Value is subjective. This is one of the central riddles of economics. But it's also why exchanges happen at all.

th3iedkid 12y ago

> but have substantially negative net value by any reasonable measure. if we were to go by entropy measures there is nothing we can do about it . So what is of value?