Lev Lafayette wrote:
On Fri, January 17, 2014 1:26 pm, Tim Josling wrote:
If you judge experts by a) ability to make predictions that turn out to be right b) ability to explain things that otherwise make no sense c) ability to design things that work d) ability to fix problems, the economics discipline as a whole is an epic fail. ........snip
In contrast I don't see much argument against a core economic principles, for example, that if the supply of a good is restricted the price goes up, or if the price is increased the demand is reduced.
Me nether; problem is following Adam Smith, I think this was generalised to the notion that 'a competitive free-market' was 'the' panacea for all social economic problems; certainly by the dries. Mind you the expectation that in a competitive free-market of rational consumers and rational producer/ retailers; I wouldn't expect it to be too hard, to demonstrate mathematically that price will follow demand. Perhaps I should add the rider, that in my view all trade can be viewed as barter; money being merely a ' synthetic commodity' which is optimised for trade as: light, compact, durable, difficult to duplicate and in limited supply. Which view explains simply, why printing money causes inflation; ..........unless you happen to be the US government ! regards Rohan McLeod