me:
> if a mode of production -- such as the one > that used to prevail in the old Soviet Union > -- cannot get the job done of producing and > distributing goods and services with a > reasonable degree of efficiency compared to > other existing modes of production, it's > bound to fail eventually if it doesn't solve > the problem.
Julio:
And also defend itself against its enemies. If there's a prototype of the successful defense of a social revolution, I'd think of Cuba.
the ability of a country to defend itself depends on its ability to produce a surplus. The surplus shouldn't be defined in totally capitalist terms: part of the surplus may be the surplus energy that a population is willing to exert to defend the country. me:
> If I had my druthers, the notion of > "historical viability" would be > linked with the ability of a mode of > production to produce a surplus beyond > labor costs rather than with the ability > of a mode of production to simply > produce (as measured by labor productivity).
Julio:
I don't understand what you mean. Productivity is not level of output. Productivity is a ratio: output per unit of resource (ultimately, per unit of labor time).
sorry about being sloppy. production and productivity are essentially the same if you hold the size of the labor force constant (which I was doing, unfortunately only in my mind).
Productivity is a ratio: output per unit of resource<
right. there are land yields, output per unit of capital goods, and labor productivity. BTW I reject the notion of "total factor productivity" based on its "adding apples and oranges" fallacy. me:
> individuals don't choose modes of production > as individuals. Instead, their "preferences" > are aggregated, often in a way that doesn't > make any sense, so that it's the entire > society that makes the "decision," with some > being more important than others.
Julio:
In capitalist societies, there's usually a smallish quota of consumption "preferences" entering directly as inputs in a political process of allocation. The rest remain as individual preferences and it is the choices instead (quantities purchased/sold) that are aggregated via markets.
huh? power battles and the like play no role in our politics?
Under communism, I'd expect the bulk of consumption "preferences" to be aggregated directly, presumably through some process of direct democracy, at different levels.
right. Representative democracy is also okay, as long as representatives can be recalled and there are other controls on them.
> one problem with our "conscious political and > legal choices" is that our consciousness > reflects our biographies within a specific > social system and its actual historical > process during the period of our lives. Thus, > what we "choose" reflects what's existed in > the past -- perhaps in contradictory ways. A conscious choice doesn't mean an unconstrained choice.
of course, but my point was about the social determination of what we want.
Human choices are never made in a vacuum. The productive force of labor is not infinite. To paraphrase Hegel, Freedom is only the consciousness of necessity, not the absence of necessity. It is often true that, "Everyone takes the limits of his own vision for the limits of the world" (Schopenhauer). That's why (note to Carrol Cox) political pessimism can become a reactionary material force -- if it grips the masses. And what grips the masses usually starts by gripping individuals.
I guess.
> I don't think it's legitimate to talk about > "a representative agent." Even general > equilibrium theory agrees with me on this. > It's called the fallacy of composition. Please explain.
consider the idea of an aggregate demand curve. The representative agent model says: assuming that nominal money is constant, if prices rise, then due to Keynes and (maybe) Pigou effects, the decreased real value of money implies a falling quantity of real commodities demanded. So AD is downward sloping. The general equilibrium type would reply: the change in the average price level corresponds to distributional changes among individuals and industries, which would also shift some individual demand curves out and some in, so that we wouldn't see a consistently downwardly-sloping demand curve. (Steve Keen has a good explanation of Sonnestein-Mantel-Debreu in his DEBUNKING ECONOMICS.)
> The fact that P and K-H efficiency requires > two or more agents is not a criticism, since > last time I looked, there _were_ two or more > agents.
Of course not. What I tried to say is that Pareto and Kaldor-Hicks efficiency are applications of the general concept of economic efficiency.
but they are the ones that are used these days. They are also easier to specify than general notions of efficiency.
> One thing I object to among orthodox economists > is the tendency to think totally in terms of > deductive logic, trying to minimize the number > of assumptions and the number of deviations from > the simplest and most idealized models. Instead > of using an abstract model as the baseline for > understanding the world, we should start with > perceived empirical reality as our baseline. > Marx's stuff in the introduction to the > GRUNDRISSE is good here.
This is a misunderstanding of the role of deductive logic in today's economics. There's already much in the PEN-L archives covering this very point.
some people (like Krugman) build little models for specific questions. That's not what I was talking about. But I would say that the majority of economists have the ideal of a perfect market burned into their retinas and judge everything by comparison to it, even if they know that real-world markets are perfect. This preanalytical vision (in Schumpeter's terms) is often backed up by such models as the Arrow-Debreu-Walras model. Starting with the ideal market fits well with the excessive use of deductive logic. Complaining that a theory requires that there be more than one person is an example of that.
This thread may already be past its point of negative returns. So, if nothing new pops, this will be my last post. Thanks, Jim. Forgive my telegraphic style, which (I know) can be pretty irksome. (I have to type under the relentless pressure of a 27-month old.)
I know the feeling. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante.
