Employment and the Steady State

It is necessary here to repeat a point made or implied earlier, that the level and rate of change of economic activity and the level of unemployment are to a large extent independent of one another. Not totally independent of course, each is one determinant of the other.  … Read more

More Dollars for Conservation?

So, environmental conservation must be the primary goal, and economic well-being depends on it – not the other way round.

That last phrase refers to the spurious argument that economic “progress” as currently understood, i.e., increasing throughput of wealth, provides money which can be spent on conserving the environment.  … Read more

Non-renewable Resources – Leave Them in the Ground?

The principle of consuming resources at a rate no faster than their rate of renewal appears to be untenable in the case of resources whose renewal rate is almost zero, as is true of fossil fuels, gas, oil, and coal, also fissile uranium and thorium.  … Read more

Minerals in National Parks – Leave Them in the Ground?

The extraction of minerals often leads not just to the consumption and depletion of the mined material, but also to the unintended but unavoidable consumption and depletion of rich and necessary biological resources, which are quite wasted in the process.  … Read more

Full Wage Indexation – Kindergarten Economics

Full Wage Indexation (FWI), indexing wages to the full Consumer Price Index (CPI), that is, increasing money wages at regular intervals by the same proportion as the rate of price increases during those intervals, is intended to maintain living standards by maintaining real wages.  … Read more

Aggregate Demand – Components and Internal Ratio

Before going on any further it is necessary to discuss the term aggregate demand.

Aggregate demand is the sum of two components – investment spending and consumer spending. It would be better if these were treated separately as independent channels through which money flows, since the relation between them is by no means constant in the sense that they can be lumped together and boosted or damped down together.  … Read more

When the Boom comes

During the 1970′s and 1980′s governments and people generally in the more perfluent nations were waiting for an economic “upturn” or “recovery” to reduce what had become chronic high unemployment. The underlying assumption was that the high throughput-increase rates, the so-called “economic growth” rates of the 1950′s and 1960′s, were normal and that the more sluggish throughput-increase (TI) rates of latter years were an abnormal phenomenon that could be expected to speed up in time through this or that brilliant policy initiative or going back to the early economics of the eighteenth and nineteenth centuries; or by eliminating (depending on your point of view) businessmen, unions, migrants, taxes, civil servants, or computers; or just by waiting.  … Read more

Real and Money Wages: Living Standards

Real wage and material living standard will be treated as different terms for the same variable.

The real wage, however, is not the same as the money wage. The real wage is the access to goods and services given to a worker in exchange for their labour.  … Read more

Ends and Means

Good Trends, Not Good Conditions

It is not the intention in this blog to establish a perfect world of perfect conditions. Such a thing has been imagined and described by many in the past, but it must always remain an abstract possibility in the indefinite future.  … Read more

Money Supply, Throughput and Inflation

Material living standards are a function of three main variables – net throughput (Tn), population, and the prevailing distribution (D) of Tn among different social and occupational groups.

Tn is a function of available wealth, the state of technology, wealth renewal rates, human values, D and the proportionate flow of money through different economic channels.  … Read more

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