Tag Archives: wealth
In 1964, the ship Alkimos was wrecked on a reef off the coast of Western Australia at a time when our largest city, Perth’s, suburban sprawl had not reached that far. The ship was Greek but had a varied and colourful history, including on-board murders and criminal activity, under different names and flags. ... Read more
Structuring, or realising, wealth into goods and services is currently called production or output, as though wealth were being created. In fact, this structuring or realisation is part of the process of throughput of wealth.
The use of goods and services, now called consumption in the sense of being opposite to “production”, is really a subsequent process in the throughput chain whereby wealth is degraded into waste matter and heat whence it may be renewed. ... Read more
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
This digression makes two further comments on the statement on weapons versus other expenditure in the UN report mentioned above. One may return to this post later and go straight on to the post “Discussion of Costs Resumed”, if desired.
The UN report statement also implies agreement with the conventional idea that economic activity is a process of accumulation of wealth. ... Read more
The terms derivative and differential are used here in their mathematical sense, denoting rates of change.
Gross national product and living standard are treated as measures of quantity of wealth. In fact, they are not the quantity but its first derivative or first differential, the rate of wealth-throughput. ... Read more
A magazine article cited, as one reason for improving safety in the home and reducing deaths and injuries to children, the argument that the deaths and injuries were a cost to the nation because of the loss of “production” of goods and services which those children, had they become healthy adults, would have accomplished in their lifetime. ... Read more
The inadequate or wrong concepts of current economics lead to a number of misconceptions, some examples of which will be given.
“Soak the Rich”
The “soak the rich” taxation policy sometimes advocated or practiced by the political left is based on a confusion about the nature of wealth. ... Read more
The direct addition of value inflation to the rate of price increases is quite small. The larger effect arises from secondary influences, in whose shaping human psychology plays an important part. These influences are triggered by the small value inflation component and its corollary, a slowing of the rate of net throughput increase relative to gross throughput increase. ... Read more
People are agents of throughput and the younger, healthier and less resistant to change are the people (for a given population, state of technology, and resource availability), then the larger and better quality the throughput they can achieve.
In more perfluent countries, in recent years, several factors have combined to effect a steady increase in the average age of the population. ... Read more
Another indirect adverse effect of environmental degradation on economic well-being arises from the effect of the degradation on people’s perception of their economic condition.
A further illustration of the erroneously perceived conflict between environmental conservation and economic well-being lies in this frequent reaction to some piece of environmental devastation: “Oh, well, at least it creates jobs for some people who wouldn’t have one otherwise.”
Certainly the degradation will keep some people busy for a while, but because of the depletion of the resource on which their jobs depend, there will be a net loss of jobs. ... Read more