Re: Re: Re: Krugman Komes Around
I had written: Krugman [suffers] an astonishing logical lapse here. He assumes rather than proves that current investment is determined by either current or expected consumption. Marx refers to this as the stupid dogma that the aim of capitalist production is consumption. ok but as consumer demand then gives and final sales suffer, couldn't firms be forced to scrap old technologies and excess capacity and invest in those processes that lower costs faster than prices are falling? Moreover, for those investment projects that are meant to meet a long term trend couldn't a drop in immediate consumption be favorable as firms may decide that it's favorable to build on the trend and thus take advantage of lower depression prices in materials, wages and possibly interest rates? In short, Krugman does not show clearly why the drop off in final sales will compound rather than have little effect or even possibly ease the fundamental problem of weak investment demand. Michael responded; Andrew Carnegie used to follow Rakesh's strategy. It worked for him, but then the long term trend for steel was very strong. Fiber optic cable ??? The theoretical point here is--to use Hayek's metaphor--that the continuous flow of the river of investment can vary independently of the level of the tide (sales of final goods) at the mouth. The upper reaches of the volume of water is affected by the immediate flow of the tributaries to the maintstream (variations in new and replacement technology). In any given period there is no obvious correspondence bttween changes in the upper reaches and the sale of final goods; nor between the sale of final goods and employment. Moreover, as Marx first and Hayek later recognized, it is generally the case that in a slump the revival of final demand is an effect rather than a cause of revival in the upper reaches of the stream of production. Even in the absence of a high tide at the mouth of the river, the recession could be exited on the basis of replacement investments (in which new technology would be embodied) or new supplemental investments in, say, the completion of high speed connectivity (assuming the overcoming of regulatory hurdles). Intel's investment surge seems predicated on the belief in just this possibility. I am not saying any of this will come to pass. My point here is to challenge the dogma implicit in Krugman's analysis that the aim and driving force of capitalist production is consumption. There is also the question of the possible overlap in the Perelman-Brenner critique of Keynesianism and the Hayekian one! Rakesh
Re: Re: Re: Re: Krugman Komes Around
Where did Hayek use that metaphor? Also, I discussed the overlap between H*yek and Marx before in my Marx book, but the overlap I emphasized was in the relationship between crises and problems in coordination via the market. Rakesh Bhandari wrote: The theoretical point here is--to use Hayek's metaphor--that the continuous flow of the river of investment can vary independently of the level of the tide (sales of final goods) at the mouth. The upper reaches of the volume of water is affected by the immediate flow of the tributaries to the maintstream (variations in new and replacement technology). In any given period there is no obvious correspondence bttween changes in the upper reaches and the sale of final goods; nor between the sale of final goods and employment. Moreover, as Marx first and Hayek later recognized, it is generally the case that in a slump the revival of final demand is an effect rather than a cause of revival in the upper reaches of the stream of production. There is also the question of the possible overlap in the Perelman-Brenner critique of Keynesianism and the Hayekian one! Rakesh -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: Re: Re: Re: Re: Krugman Komes Around
Where did Hayek use that metaphor? The Austrian Critique, The Economist, 11 June, 1983 pp.45-8 as reported in GR Steele The Economics of Friedrich Hayek. I think Justin's interest in Hayek only extends to the socialist calculation debate, not his theory of capital and business cycles? Also, I discussed the overlap between H*yek and Marx before in my Marx book, but the overlap I emphasized was in the relationship between crises and problems in coordination via the market. I do think there is a question of whether there is any similarity in Hayek's (implicit) critique of Keynesian demand management and your and Brenner's criticism of the contradictory effects of Keynesian stimulus policies. If I remember correctly, Marxists such as John Strachey in the Nature of Capitalist Crises and Leo Huberman in Man's Worldly Goods tried to show how Marxian theory captured the strong sides of the Hayekian and Keynesian diagnoses of the Depression while presenting a clear alternative in both theoretical and practical implications. rb
RE: RE: RE: Krugman Komes Around
no i meant you weren' t the only one w/claims to pre-K vision. mbs -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of Devine, James Sent: Friday, February 22, 2002 5:44 PM To: '[EMAIL PROTECTED]' Subject: [PEN-L:23086] RE: RE: Krugman Komes Around Max, I don't understand your point. It sounds like PK is leaning in the EPI direction on this one. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine -Original Message- From: Max Sawicky [mailto:[EMAIL PROTECTED]] Sent: Friday, February 22, 2002 11:32 AM To: [EMAIL PROTECTED] Subject: [PEN-L:23076] RE: Krugman Komes Around Not so fast Sparky. http://www.epinet.org/Issuebriefs/ib175.html http://www.epinet.org/webfeatures/econindicators/jobspict.html http://www.epinet.org/briefingpapers/bp121.html mbs [Maybe I should sue because of violation of my intellectual property rights (see http://bellarmine.lmu.edu/faculty/jdevine/talks/ESTalk020502.htm) ;-) ... still, this is a pretty good article.] The W Scenario By PAUL KRUGMAN First comes the victory parade. Later we'll find out if we won.
RE: RE: RE: RE: Krugman Komes Around
I'll have to call my lawyer and cancel the lawsuit... Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine -Original Message- From: Max Sawicky [mailto:[EMAIL PROTECTED]] Sent: Friday, February 22, 2002 3:04 PM To: [EMAIL PROTECTED] Subject: [PEN-L:23087] RE: RE: RE: Krugman Komes Around no i meant you weren' t the only one w/claims to pre-K vision. mbs -Original Message- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]]On Behalf Of Devine, James Sent: Friday, February 22, 2002 5:44 PM To: '[EMAIL PROTECTED]' Subject: [PEN-L:23086] RE: RE: Krugman Komes Around Max, I don't understand your point. It sounds like PK is leaning in the EPI direction on this one. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine -Original Message- From: Max Sawicky [mailto:[EMAIL PROTECTED]] Sent: Friday, February 22, 2002 11:32 AM To: [EMAIL PROTECTED] Subject: [PEN-L:23076] RE: Krugman Komes Around Not so fast Sparky. http://www.epinet.org/Issuebriefs/ib175.html http://www.epinet.org/webfeatures/econindicators/jobspict.html http://www.epinet.org/briefingpapers/bp121.html mbs [Maybe I should sue because of violation of my intellectual property rights (see http://bellarmine.lmu.edu/faculty/jdevine/talks/ESTalk020502.htm) ;-) ... still, this is a pretty good article.] The W Scenario By PAUL KRUGMAN First comes the victory parade. Later we'll find out if we won.
Re: RE: RE: RE: RE: Krugman Komes Around
- Original Message - From: Devine, James [EMAIL PROTECTED] To: [EMAIL PROTECTED] Sent: Friday, February 22, 2002 3:26 PM Subject: [PEN-L:23088] RE: RE: RE: RE: Krugman Komes Around I'll have to call my lawyer and cancel the lawsuit... Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine == That'll be $8million please. Enron Bankruptcy Lawyers' Bill: $8 Million By Carrie Johnson Washington Post Staff Writer Friday, February 22, 2002; Page E04 In every scandal, there are winners and losers. The lawyers usually are among the winners. Consider U.S. Bankruptcy Court in New York, where Enron Corp.'s law firms filed more than $8 million worth of bills for their first month on the job. Weil, Gotshal Manges, Enron's lead lawyers in the bankruptcy reorganization, asked for $5.4 million for their services in December. The figure includes $3 million in lawyers' time -- including $700 an hour for senior partner Ira Millstein and $685 an hour for partners Greg Danilow and Martin Bienenstock -- $169,883 for copying and $89,799 for computer research, according to court documents the law firm filed filed Wednesday. Andrews Kurth, another firm representing the debtors, requested $1.54 million in fees and $78,838 in expenses. Cadwalader, Wickersham Taft of New York asked for $237,734. LeBoeuf, Lamb, Greene MacRae racked up $650,000 in lawyer and paralegal time and $56,000 in expenses. And Togut, Segal Segal sought $208,829 in fees and another $36,241 in expenses. The lawyers weren't the only ones lining up this week. Ernst Young Corporate Finance LLC charged $586,609 for providing restructuring advice from December to late January. No word yet on when Judge Arthur J. Gonzalez will review the bills.
RE: Re: RE: RE: RE: RE: Krugman Komes Around
Is someone suing Krugman for writing a puff-piece about Enron? Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine That'll be $8million please. Enron Bankruptcy Lawyers' Bill: $8 Million By Carrie Johnson Washington Post Staff Writer Friday, February 22, 2002; Page E04 In every scandal, there are winners and losers. The lawyers usually are among the winners. Consider U.S. Bankruptcy Court in New York, where Enron Corp.'s law firms filed more than $8 million worth of bills for their first month on the job. Weil, Gotshal Manges, Enron's lead lawyers in the bankruptcy reorganization, asked for $5.4 million for their services in December. The figure includes $3 million in lawyers' time -- including $700 an hour for senior partner Ira Millstein and $685 an hour for partners Greg Danilow and Martin Bienenstock -- $169,883 for copying and $89,799 for computer research, according to court documents the law firm filed filed Wednesday. Andrews Kurth, another firm representing the debtors, requested $1.54 million in fees and $78,838 in expenses. Cadwalader, Wickersham Taft of New York asked for $237,734. LeBoeuf, Lamb, Greene MacRae racked up $650,000 in lawyer and paralegal time and $56,000 in expenses. And Togut, Segal Segal sought $208,829 in fees and another $36,241 in expenses. The lawyers weren't the only ones lining up this week. Ernst Young Corporate Finance LLC charged $586,609 for providing restructuring advice from December to late January. No word yet on when Judge Arthur J. Gonzalez will review the bills.
Re: RE: Re: RE: RE: RE: RE: Krugman Komes Around
- Original Message - From: Devine, James [EMAIL PROTECTED] To: [EMAIL PROTECTED] Sent: Friday, February 22, 2002 3:52 PM Subject: [PEN-L:23093] RE: Re: RE: RE: RE: RE: Krugman Komes Around Is someone suing Krugman for writing a puff-piece about Enron? Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~jdevine If the many-worlds interpretation of quantum theory is true, yes. ;-) Ian
