Potpourri
==> Blimey Cow on “there should be a law.”
==> A new Fraser Institute collection (edited by Don Boudreaux) on (the decline of) economic freedom and entrepreneurship in the US.
==> I liked this post by Bryan Caplan, on how “econ melts your brain” (and not in a good way–he doesn’t mean, “It’ll blow your mind!”). I had a similar experience when I taught Intro in Hillsdale. I asked some really basic question on a mid-term, trying to get students to illustrate the answer with the cost curves we had to learn. A bunch got the basic answer wrong. I know if I had asked them the general question at the start of the semester, their common sense would’ve given them the answer. So I (teaching standard micro) had provided negative value to those students.
==> Columbia econoimst Kopczuk has a new paper out commenting on Piketty. A man of wisdom, he does not cite my paper with Phil Magness.
==> Tyler Cowen loves my new book.
==> Troll hard or go home.
==> I find the good in Noah Smith’s blogging.
Speaking of Don Boudreaux: how is it that he beat you to mentioning your new book?
Troll hard: I’m not on twitter but the conversations that get blogged suggest that Trolling is the whole point of it.
Bob, will your new Human Action book be released for free online, similar to your Mises Institute books?
I doubt it Keshav.
Your twitter trolling was simple (and not in a good way), but still brutally accurate and well-stated. Thumbs up. 🙂
By the way, the Labor Theory of Value really is more common among non-economist academics than I thought. You were right to skewer it. Indeed, I simply do not understand what objection the typical progressive has to the economic system of the Soviet Union, other than, perhaps, that it was environmentally unfriendly.
The Labor Theory of Value works on an individual basis. The real cost to you of making a choice is how much of your life is consumed by that choice (if you prefer, the opportunity cost of what else you might have done).
The problem is attempting to equate one man’s labor with everyone else’s. That’s an error because of subjective valuation, but this has nothing to do with labor. Subjective valuation applies to everything, even money, so treating labor as some special case is silly. Labor is as much a measure of value as anything else, and for many purposes (eg individual evaluation of a task) can be a good choice of measure.
“The Labor Theory of Value works on an individual basis.”
“The problem is attempting to equate one man’s labor with everyone else’s.”
“Labor is as much a measure of value as anything else, and for many purposes (eg individual evaluation of a task) can be a good choice of measure.”
That people value labor differently from one another, even for the same good, is an important point. Lot’s of problems could be avoided if more people realized this.
But for the sake of consistency, I would submit that your labor is valuable to you only insofar as you expect it to satisfy your preferences. You value the end for which your labor serves as a means.
Labor isn’t the source of value; Rather, that which you value is the source of your labor.
No, my life is valuable to me because without it I don’t have any preferences.
After I have a life, then I can start to get interested in preferences.
Labour, by definition, is after all what you do with your very finite lifespan.
“The real cost to you of making a choice is how much of your life is consumed by that choice”
Would not this mean the only aspect of labor that interests you is the amount of time it takes?
“No, my life is valuable to me because without it I don’t have any preferences.”
You don’t live so that you can make up preferences. Rather, you have preferences, and therefore you live to fulfill them.
“Labour, by definition, is after all what you do with your very finite lifespan.”
Yes. But it is what you do in order to satisfy preferences.
Your preferences are what make the means to fulfill them to be valuable.
As Joseph Salerno notes, if no one valued diamonds, then diamond mines wouldn’t have a value, and neither would the miners.
Also, the last sentence of your mises.org post does not follow from your premises. And David Andolfatto is (rightly or wrongly, probably the latter) challenging the claim macroeconomists don’t understand their models’ assumptions.
“So I (teaching standard micro) had provided negative value to those students.”
-Yeah. In my first run-in with standard micro, I was completely surprised at the near-lack of anything resembling Rothbard’s somewhat simplistic, but still timeless, “What Has Government Done to Our Money?” or anything resembling Gene Callahan’s introduction to economics. This was a shock to me, but I was able to adjust. But I see how students in their first run-in with standard micro without any previous background in basic econ can easily end up (very) confused.
Although I tend to prefer my Mises in Galician, nevertheless, congratulations on the book!
Re: “how “econ melts your brain””…
I think economics needs something akin to this in mathematics:
http://www.youtube.com/watch?v=2hhjsSN-AiU (Short version)
Longer (better) version:
http://www.youtube.com/watch?v=H69YH5TnNXI
I think the Tau concept is on the right track, but that, just like knowing the diameter is overkill, so is knowing the length of the circumference – and for the same reason.
If you know you’re going to need a circle, you will use the radius (or radius times two when the length of the entire circle is relevant) to make it, and the length of the circumference will be irrelevant.
If you need a circle with a certain length of circumference, then you’re just going to make a loop out of that length, making the length of the radius irrelevant.
I would never want or enjoy the concept of “overkill” entering the mathematical lexicon. Overkill is how old boundaries are reached and then transcended. It is like logical liberty.
The fundamentals of a circle go beyond mere lengths of diameters and radii of circular or cylindrical shaped objects. The ratio of C to D (Pi) or C to r (Tau) are found in a myriad of physics formulae the uses of which help us produce better things and live better standards of living. The long video touches on only a handful, but there are many more.
But, to each their own.
I also think “i” is wrong.
Instead of abiding by the operating constraints of the radix, people decided that they should just be able to do any kind of math at all on the radicand, as if it was isolated.
That is because complex numbers can be visualized on a planar two dimensional surface, where each complex number is a couplet of two coordinates. For coordinates, the “radicand” is like the y coordinate. Transitioning the radicand to other values via operands on it, allow us to relate the complex numbers.
There is a neat portion in the longer video where it is shown that “rotating” or “tau’ing” any complex number by 180 degrees or half a Tau, gets you that value times negative one. It is intuitive to me because turning 180 degrees makes you go along the same line but exactly opposite direction. It works for both complex and real numbers.
Trying to pretend that unions invented a day of rest at the end of the week… what an artist.
I wonder if he also supports the union thuggery that’s been reported in Wisconsin, with police squads being sent to invade people’s homes.
http://www.nationalreview.com/article/417155/wisconsins-shame-i-thought-it-was-home-invasion-david-french
Wow! I am really excited about your new book on Human Action, thank you for writing it! Do you think that this will be the perfect intro. to read before Human Action and thus make it (Human Action) understandable for the intelligent layperson?