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“If EVERYBODY is irrational, then how can we expect them to make rational decisions all or even most of the time? Libertarianism assumes a rational...”
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“What if economics is to move away from being a self-centred academic discipline interested only in working out the consequences of its own...”
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Dr. William Rees on ‘The Dangerous Disconnect Between Economics and Ecology’
From The Institute for New Economic Thinking:
The world economy...
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But in economics, core and oft-used assumptions necessary to make many theories work, such as “everyone has...
Kahlil Gibran’s faith in markets is to be applauded, however within his brief philosophical fiction The Prophet unexpected economic wisdom is to be found.
Ever since my mother revealed to me that my middle name was chosen after the great poet Kahlil Gibran, I poured over his work to unearth what was so inspiring. Rereading The Prophet as a student of economics cast an interesting light on his words. Next time you find yourself betting your retirement on APPL or MSFT consider:
And tomorrow, what shall tomorrow bring to the overprudent dog burying bones in the trackless sand as he follows the pilgrims to the holy city? …And what is fear of need but need itself? …Is not dread of thirst when your well is full, thirst that is unquenchable? …For to be overmindful of your debt, is to doubt his generosity who has the free-hearted earth for mother, and God for father.
Mind you, I am presenting a highlight reel of what is a larger passage. I see two take-aways in this:
- If you are satisfied, horde not.
- Strangely: There are more important things than money.
Now, I understand this is a pretty liberal way to start off this review - the first economish chapter in the book is on giving. Why doesn’t the dog understand that the voyage to the holy city is more important than the bones he stores in the ever changing sands? Or - to put this in a little perspective - in the islamic tradition should any man on his pilgrimage to Mecca die along the way, God understands he lived with purpose and will accept him into heaven. If only the willful reallocation of excessive wealth occurred in America as the prophet suggested… See Gini Coefficient
On Buying & Selling
Equity is central throughout The Prophet. Gibran’s philosophical poetry praises markets as the vehicle of obtaining satisfaction, while offering metered warning of their downfalls.
It is in exchanging the gifts of the earth that you shall find abundance and be satisfied. Yet unless the exchange be in love and kindly justice, it will but lead some to greed and others to hunger.
Still starkly relevant to today’s economic issues, it is surprising how beautifully the failures of free-trade can be composed.
On Work
For to be idle is to become a stranger unto the seasons, and to step out of life’s procession, that marches in majesty and proud submission towards the infinite… …For if you bake bread with indifference, you bake a bitter bread that feeds but half man’s hunger.
As a workaholic myself, I find the first quote quite validating, yet the second quote is easily the stronger metaphor. Economic schools of thought, even the popular neo-classical and monetarist, recognize market failures. These are generally occur when a market does not function efficiently. However, economists rarely consider the more philosophical market failure of goods and services not satisfying the people. Understanding that at first this idea may be counter-intuitive (why would you buy something unsatisfying?) and cause outrage among economist, let me elaborate. From the consumer’s perspective, there are goods and services that we purchase because we like them, and those we purchase because we need them. The demand for these goods & services are considered elastic (as with the former) or inelastic (as with the later). Inelastically demanded goods and services we will buy despite the cost, and often despite the quality. What happens when something we need is supplied in less than satisfying fashion? For instance:
- Riding a dirty city bus full of crack-heads to work only satisfies half my pleasure in travel.
- A limited grocery store only fulfills half my pleasure in eating.
This non-traditional market failure also applies to the labor market. In the first quote above Gibran claims labor is inherent, and that denying it is unnatural. Sadly, we must often take work despite the quality of its conditions in order to meet our other worldly needs. Should a man bake bread with indifference because his hourly wage is terrible, the resulting bitter bread is but the by-product of inequity. Albeit from a different chapter in the book, Gibran does warn of deviant employers:
And suffer not the barren-handed to take part in your transactions, who would sell their words for your labour.
