I’m an economist researching how to improve the teaching of economics. I am also attempting to write a fantasy novel/economics textbook in my pursuit of making learning economics marginally less dismal.
Needless to say, I’m stoked to join this community!
Looking forward to getting to know you all and figuring out where and how I can contribute
My novel is definitely more of a micro textbook, but it does touch on some macro concepts. I’m still not sure exactly how it fits into typical econ class structures. But that’s mostly because I disagree with how econ structures our courses, intro ones especially.
Thanks Alberto! Hi @Kyle and @petussing. Kyle, I’m currently running an MS in Complexity Science course called Complexity Economics, the reading lists, models and lectures are all here: www.summaeconomica.com.
I’m currently on a zoom with KSR! I’ll have lots to share soon, hopefully a recording.
Hello, zazizoma! I took a cursory look at your course – looks fascinating! I am intrigued by your criticism of productivity numbers, but still note that it would be hard to correct them in any realistic way without changing the entire economic system. That said, it reminds me of the famous statement of Robert Solow: “we see computers everywhere except in the productivity statistics.” Solow’s assumption is usually taken to be that the productivity stats were accurate, but that computers were for some reason not boosting value produced per hour. I find this so strange that I take the perspective that it is the stats themselves that are not sufficiently capturing the effects of information technology. One suspects that this is linked to the rise of “rentier capitalism” – large profits gained without equally large work expended – to a significant extent as a result of the government-conferred monopoly, or “patent” provided for especially tech products.
Thanks for the comment!
My ideal productivity statistics dataset would look something that found in Babbage’s On the Economy of Machinery and Manufactures. While I don’t agree you’d need to change the economic system to collect such data, you may need to change the political environment around the ownership of such statistics.
I agree with you (an apparently the late Solow ; )) that productivity stats, at least in the US, aren’t telling us anything about tech productivity, and am pretty comfortable with the claim that they’re not telling us anything straightforward about productivity regardless of sector or tool, because the wage-productivity linkage is not robust.
To discover why that linkage doesn’t hold is an entire research program, but I’d start with Markovits’ Meritocracy Trap and Graeber’s BS Jobs and the hints about evolutionary niche-construction dynamics.
But if the “Babbage Principle” of the increase in productivity that results from a greater differentiation of labor to free up skilled labor from lower-skilled tasks is, as Babbage suggests and Marx makes explicit, that the factory owners (capitalists) make higher profits instead of the workers being paid higher wages, then the simplest best solution would be to share profits a la Proudhon – in other words Socialism by factory workers directly (along with functioning free markets) rather than Marxist-Leninist government ownership of production and allocation on the basis of so-called “need” (as determined by bureaucrats). Which brings us back to wholesale economic transformation of a specific kind.
Perhaps we are somewhat is agreement; the surplus from division of labor is a real thing, and is a wonderful thing, is the key to eventual freedom from material catering concerns.
How that surplus is applied is a matter of social choice, with competing claims. J Robinson is on record claiming that the whole labour theory of value was created to justify giving that surplus to ‘capitalists’. I find those labels unhelpful in that they produce false dichotomies. Look at the underlying processes . . . in a worker owned and managed firm financed through credit, who are the capitalists? Not sure how ‘socialism’ fits in here.
My reference to Babbage is that I want his data: tables of firm, the workers employed, what machines they use, how much of what they produce and at what wage. No change in ownership or operations needed to collect that data.
Socialism fits in, in the Proudhonian sense of worker-owned factories. This model has practically not ever been used in practice, with the partial exception of worker-owned cooperatives in the early days after the Russian Revolution, soon displaced by government ownership. IMHO, this is because there is no particular incentive for a country to implement such a model: capitalism is of course promoted by capitalists, government-owned socialism by some governments not captured by capitalists, but worker ownership is only in the interests of workers, traditionally not a strong voice, including in (in practice ESPECIALLY in) countries that implement government ownership of the means of production. It was later termed “Mutualism”. Proudhon proposed a “Bank of the People” to fund the creation of worker-owned businesses instead of governments or capitalists – this became a rather different animal later on – the foundation of the “credit union movement”. " In the wake of the French Revolution of 1848, Proudhon began elaborating his proposal for a “Bank of the People”. He thought such a bank could guarantee mutual credit to all workers, enabling them bring the product of their labour under the collective ownership of all that participated in production." Mutualism (economic theory) - Wikipedia.
Thanks! I’m a huge fan of worker ownership, since Red Mars! There’s three or four current papers on them in the Complexity Economics reading list. I’d never linked them to socialism before, though, and not sure I’d find it helpful to do so.
Alfred Chandler, in Scale and Scope, described German banks whose purpose is to fund new firms. In fact, I am working on a model to compare bank-funding vs stock-funding with a colleague who’s discovered econometrically that bank-funding leads to less income inequality.
Whether that’s because bank-funded firms tend not to expand and consolidate like stock-funded firms (Chandler’s argument) or that firm profits return in part to the bank, implying future distribution within the broader community rather than remaining with a small subset of households, is to be determined.
Do you have a link to that article (the initial econometric one, not the modeling one you are still working on) you could share?
I think it’s a great finding with practical implications for how society allocates capital. Since the pandemic, people seem to be putting less emphasis on the stock market as a way of gauging the health of the economy, so it seems like a ripe opportunity to reevaluate its role in general.