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Showing posts from February, 2014

ON THE ORIGIN OF SPECIES (OF MONEY)

MONEY VS. WEALTH

Money is a medium of exchange. You exchange it for products (goods and services). The products, all put together, constitute wealth. So wealth is not money. It is the stuff you exchange the money for. So the wealth level of a society is the value in any currency of all the stuff that money can be exchanged for in that society.





THE ABSENCE OF MONEY

Money is not timeless. It was invented. Humans traded in the absence of a medium of exchange for some long time. I dunno how long. That's a matter for anthropology and archaeology. We reached physiological modernity roughly 500k years ago, so we had quite a while to get our act together, but the first evidence of metal working is only about 10k years old, in the Middle East.

This throws up a theoretical problem. What if I have a spare fur coat, but I want spear, while you have  a pair of boots and want a coat. Only one of us is actually going to get what we want if we trade. You'll get your coat and survive the winte…

ECON 1b EXCHANGE

I reserve the right to be wrong.



Last time we ploughed our mucky furrow through the meadow of production, so it seems fitting, actually necessary, to touch upon the town square of exchange also. Exchange, or trade, is the sibling of production as the other human action that creates economics.



DIRECT EXCHANGE / BARTER ECONOMICS

So to begin with people would trade one product for another product. As long as each of us has something the other wants, that's OK, but that situation is very unlikely to arise. In fact, most times I meet others, even if I'm careful and choose who I trade with so I know they have what I want, I can't be sure they'll want what I have. So let's introduce a medium of exchange that I can hand you in exchange for whatever I want from you!



MEDIUM OF EXCHANGE / MONEY ECONOMICS

A medium of exchange is pretty nifty. I'll go into that in more detail later. All that matters now is that, once trade consists of a medium passing from me to you, and a …

ECON 1a FACTORS OF PRODUCTION

I reserve the right to be wrong.

So, economics is concerned with people's material production and exchange with each other. 'What the floop does that mean, Matt?' I hear you ask!

You create in the course of your life. Creation, which economists call production, takes in manufacture, harvesting crops, writing novels, and so on...

You sell (exchange for money) these things you have produced. As they were produced, they are called products. Products can be physical, tangible, hold-in-your-hand goods, or non-physical, intangible services. Both are produced. Both are products.

Phones, cars and clothes are goods. Haircuts, massages and investment advice are services. A book is a tangible good, but the novel inside is an intangible service. Same with a CD/DVD/Blu-Ray. Overall, they are all still products.

'But Matt, how do economists explain the making of products?'



LAND, LABOUR, AND CAPITAL

Products are produced. We arrive at them through production. But that production …

POST-MODERNIST POST-STRUCTURALIST POST-FEMINIST POST-CYNICAL HAPPINESS ERUPTS!

I reserve the right to be wrong.



I believe in the main assertions of third-wave feminism, that everyday discourse privileges my sex at the expense of the other; and that men too are harmed by this patriarchy in various ways, as Fathers 4 Justice ably demonstrates. Misogyny will probably be a topic I cover occasionally, since I am fascinated by the population-level misogyny in so many of our story-telling tropes and popular discourses. I'm also fascinated by popular culture for god knows what reason, as well as house prices. Ooer, lovely delicious house prices! Mortgages and rents, to you, dear reader.



I will share my learnings in the wonderful worlds of the social sciences. My focus is economics, but this blog will inevitably deal with geography, political science, sociology and psychology too. There are probably bits of humanities like archaeology and anthropology, plus some science, in particular neuroscience, since it's highly relevant to the social sciences.



Woohoo! Away w…