Economic (Mis)Education in Europe

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The discussion highlights concerns about economic education in Europe, particularly referencing a French textbook that suggests economic growth leads to negative health outcomes. Participants debate the validity of this perspective, with some arguing it conditions people to accept mediocrity while others believe it raises important health considerations. The conversation also touches on the broader implications of consumerism and the values instilled in societies regarding work and economic success. There is a recognition that while economic development has costs, the framing of these costs can influence societal attitudes and expectations. Overall, the thread emphasizes the need for a balanced understanding of economics and its impact on both health and societal values.
  • #91
W3pcq said:
People generally are motivated by self interest, this is one of the first things you learn in econ. The point of a Democracy is to protect us against this trend of human nature.

I think you have a very romantic (and unrealistic) view of Democracy. First of all, I don't know whether the "goal/point" of Democracy is to protect us against the self-interest of others. Second, even if that is the "stated" goal/point of Democracy, one would need to see how close it comes to reaching that point. Democracies often allow one to pursue the ugly aspects of human nature in ways that are extremely difficult without Democracy and the force of government. Big businesses (such as Pharmaceutical companies, car makers, etc) and other sellers (such as farmers, doctors, cab drivers, etc) do this by restricting who can enter their field, in order to give themselves monopolistic powers (and therefore charge higher prices at the expense of consumers). Likewise, there are still laws in some states which make it illegal for two homesexuals to engage in sexual activity (even in the privacy of their own home). Laws in the South before the civil rights movement restricted all kinds of freedoms for blacks that would have been very difficult without the use of Democracy. You say that Democracy "protects" us against others, but it seems to me that it actually does the opposite.

Please watch as this is highly related to this discussion (less than 2 minutes and 30 seconds):
http://video.google.com/videoplay?docid=5002146604154574832&q=milton+friedman+donahue&total=1&start=0&num=10&so=0&type=search&plindex=0

P.S. By the way, I am not anti-Democracy. I just think that many people have a romanticized view of it, and that it's not as great as many believe. On this issue, I have been very influenced by what John Stuart Mill called the "tyranny of the majority" as well as James Buchannans work on "Public Choice Theory" and Fredrich Bastiats book "The Law." These things have made me realize how inefficient Democracy is, as well, as the ugly aspects of Democracy. I think we need Democracy, but that we should keep it in check by limiting what can and cannot be decided by a majority rule. For example, should we be allowed to vote on Free Speech? Should we be allowed to vote on whether slavery should be legal? Should we be allowed to vote on who you can personally associate yourself with? Should we be allowed to vote on who you can do business (including trade) with? When is it ok to use democracy to limit the freedom and liberty of another human being?
 
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  • #92
Art said:
You just blandly ignore any facts or data which contradict your opinions and barrel on regardless repeating the same mantra. Not sure if that qualifies as trolling but it makes discussions pointless after a while.

LOL. I try very hard to lay out solid arguments that are congruent with the facts, as well as answering any direct question in response to facts. I've noticed that often times I point out facts and data that contradict others opinions and they continue to "barrel on." Who knows, maybe I've even done that to you?
 
  • #93
Art said:
:confused: Why?
What I'd like to do is make a simple case comparison to see the difference in living costs, but I haven't found the time to find data to compare. I hope I'll get around to it later.
 
  • #94
Yonoz said:
What I'd like to do is make a simple case comparison to see the difference in living costs, but I haven't found the time to find data to compare. I hope I'll get around to it later.
That's what GDP PPP does.
 
  • #95
Economist said:
LOL. I try very hard to lay out solid arguments that are congruent with the facts, as well as answering any direct question in response to facts. I've noticed that often times I point out facts and data that contradict others opinions and they continue to "barrel on." Who knows, maybe I've even done that to you?
Okay then address the data I provided in my earlier post #81.
 
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  • #96
Yonoz said:
What I'd like to do is make a simple case comparison to see the difference in living costs, but I haven't found the time to find data to compare. I hope I'll get around to it later.

Art said:
That's what GDP PPP does.
Well GDP PPP speaks only to income in real terms, that is, the purchasing power of your income. It doesn't tell you how much or if one has to pay for health care, taxes, or garbage collection. Also, one has to be careful about GDP distribution in the country. The example of Equatorial G. was pointed out earlier - 500K poor people with an oil rich dictator makes the country wide GDP PPP look very good.
 
  • #97
mheslep said:
Well GDP PPP speaks only to income in real terms, that is, the purchasing power of your income. It doesn't tell you how much or if one has to pay for health care, taxes, or garbage collection. Also, one has to be careful about GDP distribution in the country. The example of Equatorial G. was pointed out earlier - 500K poor people with an oil rich dictator makes the country wide GDP PPP look very good.
It equalises the cost of living using the CPI allowing direct comparison in per capita spending power between 2 countries so provided there isn't a huge disparity in wealth distribution between the countries being compared it is probably the best measure to use and Ireland and Israel have similar GINI indexes 34.3 vs 39.2.
 
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  • #98
mheslep said:
Well GDP PPP speaks only to income in real terms, that is, the purchasing power of your income. It doesn't tell you how much or if one has to pay for health care, taxes, or garbage collection. Also, one has to be careful about GDP distribution in the country. The example of Equatorial G. was pointed out earlier - 500K poor people with an oil rich dictator makes the country wide GDP PPP look very good.
Also, Wikipedia's got a good bit on this: http://en.wikipedia.org/wiki/Purcha...es_with_PPP_comparisons_in_welfare_economics"
Looks like I'll be posting less now, the senior university strike ended today, we're going to have to catch up on a whole semester. :eek:
 
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  • #99
Art said:
It equalises the cost of living using the CPI allowing direct comparison in per capita spending power between 2 countries
No, GDP PPP equalizes gross product between two countries, and production is not necessarily equal to cost of living. Production will typically drive cost of living but so can other factors.
 
  • #100
mheslep said:
No, GDP PPP equalizes gross product between two countries, and production is not necessarily equal to cost of living. Production will typically drive cost of living but so can other factors.
I suggest you check out the World Bank who compile these figures and read their definition and methodology. http://extsearch.worldbank.org/servlet/SiteSearchServlet?q=gdp ppp&dPgLang=ENG Many of those other factors you allude to are now included in the calculations. It may not give a perfect comparison in standards of living but it's the best indicator available and I would suggest more useful than comparing refuse collection costs.
 
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  • #101
Art said:
I suggest you check out the World Bank who compile these figures and read their definition and methodology. http://extsearch.worldbank.org/servlet/SiteSearchServlet?q=gdp ppp&dPgLang=ENG Many of those other factors you allude to are now included in the calculations. It may not give a perfect comparison in standards of living but it's the best indicator available and I would suggest more useful than comparing refuse collection costs.
Yes I am familiar with the method. The PPP calculation can get complicated but at the end its still basically GDP/PPP. The 'other factors' I referred to above especially include government subsidies. Sorry to give http://en.wikipedia.org/wiki/Purcha...es_with_PPP_comparisons_in_welfare_economics" ala Yonoz here but I am short on time:
Differing levels of government involvement in social spheres further complicate development of good CPI baskets (and, consequently, PPP measurements). For example, in 1986, nominal GDP of the United States was almost 4 times larger than the nominal GDP of the Soviet Union (on a per capita basis). Direct comparison failed to capture, however, that the Soviet Union provided free ... higher education and free healthcare to all its citizens, whereas Americans had to pay for education and healthcare themselves. To properly account for differences in quality of life in this situation, the CPI basket would have to include these expenditures explicitly. More importantly, government subsidies can potentially have large effect on consumption levels (free higher education will result in more college graduates), making it difficult to choose weights for individual components of CPI.
 
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  • #102
CaptainQuasar said:
LydiaAC, I have read that in some places in Mexico Indians do not know how to speak Spanish, only the old Indian languages. Is this true? In the Indian towns do they speak Spanish or an Indian language?

I do not know exactly the number but the percentage of Indians who do not speak Spanish is significant. Most of them live in Indian towns. The gender distribution is not uniform: there are more women who does not speak Spanish than men. Indians who live in non-Indian cities learn at least a little of Spanish and in Baja California, a little of English.

I would like to comment about something related with capitalism. In a forum, a mother complained about Latin America Discovery Kids Channel because, although presents shows which promote good nutrition, they make publicity of non-nutritional food. A participant, who was fond of capitalism, reacted aggressively, and called her f*** communist and asked with sarcasm what she thought that the channel make money, if she thought that the channel could be sustained by the tomato farmers and so on.
I thought that, still in the spirit of capitalism, what that mother asked was not unreasonable. She was asking for a product "a TV channel who promotes good nutrition in shows and announcements". A TV business could opt for offering that product and maybe they must charge more money for it, because the publicity would be scarce. If the TV viewers and the TV business could find an arrangement which satisfy everybody, both parts would be better off. What does this have to do with communism?
To say that free markets are a way in which the humans can associate freely and without coercion is not the same that say that free markets are the only way in which humans must be allowed to associate. The above example is still in the logic of free markets but there is a lot of examples in which humans associate freely outside of free markets like in the case of open source software or Wikipedia.
 
  • #103
Agreed, the free market premise that value has anything to do with price exercises tortured logic where we assume comfort of a few is a price many are willing to pay, and ignores the unholy incomes of many athletes, movie stars, CEO's compared to say a bus driver or school teacher. To me the value of a teacher is self evident, the CEO pawning unneeded crap thru ever more powerful media is not.
 
  • #104
denverdoc said:
To me the value of a teacher is self evident, the CEO pawning unneeded crap thru ever more powerful media is not.

Well, it's not up to you to decide. The "value" of these professions have been worked out through numerous decision makers and markets processes. For you to sit back and say that you "disagree" with this outcome is to second guess the decisions made by a large amount of independent decision makers. And frankly it's arrogant and a bit elitist to think that you have the knowledge and judgement to be able to second guess this process.
 
  • #105
Economist said:
Well, it's not up to you to decide. The "value" of these professions have been worked out through numerous decision makers and markets processes. For you to sit back and say that you "disagree" with this outcome is to second guess the decisions made by a large amount of independent decision makers. And frankly it's arrogant and a bit elitist to think that you have the knowledge and judgement to be able to second guess this process.
Well I think it's arrogant and elitist of you to think you can second guess the complex historical processes involving millions of decision makers that resulted in the current economic ideas of Europe. HOW DO YOU KNOW it's not just part of a master plan leading us into an eternal utopia!? HUH HUH!?
 
  • #106
Economist said:
Well, it's not up to you to decide. The "value" of these professions have been worked out through numerous decision makers and markets processes. For you to sit back and say that you "disagree" with this outcome is to second guess the decisions made by a large amount of independent decision makers. And frankly it's arrogant and a bit elitist to think that you have the knowledge and judgement to be able to second guess this process.

Dude - you realize that you're almost literally saying "the Market is God" don't you? His wisdom is beyond human ken, hubris alone questions it.

"Pish! Value need have nothing to do with reality!" is the Enron mindset. By conflating market price with the general concept of value you are attributing far more insight to the Invisible Hand than is warranted or even rational. Urging that everyone surrender their personal judgment of value - and criticizing failure to do so as arrogance - demonstrates a fundamentally superstitious appraisal of reality.

Yeah, markets are handy tools economically, mathematically, and systemically, but they aren't some general magic wand and they don't have the oracular powers that you're attributing to them. You're granting authority to inanimate objects (or inanimate patterns, at least) and advancing a Shamanic Fetishist interpretation of economics.
 
  • #107
Economist said:
Well, it's not up to you to decide. The "value" of these professions have been worked out through numerous decision makers and markets processes. For you to sit back and say that you "disagree" with this outcome is to second guess the decisions made by a large amount of independent decision makers. And frankly it's arrogant and a bit elitist to think that you have the knowledge and judgement to be able to second guess this process.

Well, OK. But when so much relies on powerful marketing tools, misinformation, and human foibles, I have to second guess. If the world were to suffer from some plague tomorrow, good luck with your market choices. I'll stick with mine.
 
  • #108
Smurf said:
Well I think it's arrogant and elitist of you to think you can second guess the complex historical processes involving millions of decision makers that resulted in the current economic ideas of Europe. HOW DO YOU KNOW it's not just part of a master plan leading us into an eternal utopia!? HUH HUH!?

I personally think there is a big difference between decisions made in a market context, where individuals voluntarily interact with one another, and decisions made in a political context were majority rules, and people can personally vote for policies that harm other people. Markets are not a zero-sum game, while politics and democracy on the other hand are.

The point is that prices (which includes wages) are very complex phenomenon that occur through large numbers of decision makers. One of the main reason that socialism doesn't work is that it's much to difficult for small numbers of individuals to correctly set prices. Hayek talks very intelligently about this, and if you don't know how important a role prices play I would suggest any introductory textbook on microeconomics.

CaptainQuasar said:
Dude - you realize that you're almost literally saying "the Market is God" don't you? His wisdom is beyond human ken, hubris alone questions it.

"Pish! Value need have nothing to do with reality!" is the Enron mindset. By conflating market price with the general concept of value you are attributing far more insight to the Invisible Hand than is warranted or even rational. Urging that everyone surrender their personal judgment of value - and criticizing failure to do so as arrogance - demonstrates a fundamentally superstitious appraisal of reality.

Yeah, markets are handy tools economically, mathematically, and systemically, but they aren't some general magic wand and they don't have the oracular powers that you're attributing to them. You're granting authority to inanimate objects (or inanimate patterns, at least) and advancing a Shamanic Fetishist interpretation of economics.

I don't even think markets are God. If they were, they'd be perfect. The fact is, markets are far from perfect (although they do work pretty darn well). The real question is how well markets work compared to other realistic alternatives. Usually the most realistic alternative is politics, which is even less perfect than markets.

denverdoc said:
Well, OK. But when so much relies on powerful marketing tools, misinformation, and human foibles, I have to second guess. If the world were to suffer from some plague tomorrow, good luck with your market choices. I'll stick with mine.

Marketing plays a role, but everyone markets, so it probably generally works out were the best products are the ones that stick around. Do you realize how many companies (even ones that market) go out of business every year? Do you also realize that research has showed that advertising actually decreases prices (by increasing competition)?

What are you talking about with the plague? If a plague happened, most survivors would have a very tough life, specifically because many markets would probably break down.
 
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  • #109
Economist, you say prices are complex phenomena but you tend to throw around statements such as PPP, GDP, and GNP. These are simple tools given in intro econ courses to students to show them how an economist should think. You cannot measure two economies like the US and the UK simply by using these tools. Politics makes a world of difference and majority rarely is a deciding factor in business and politics where it is more about owning volume over votes or opinions.
 
  • #110
DrClapeyron said:
Economist, you say prices are complex phenomena but you tend to throw around statements such as PPP, GDP, and GNP. These are simple tools given in intro econ courses to students to show them how an economist should think. You cannot measure two economies like the US and the UK simply by using these tools. Politics makes a world of difference and majority rarely is a deciding factor in business and politics where it is more about owning volume over votes or opinions.

Actually, things like controlling for inflation and PPP indexes are used in order to help one control for prices and draw insightful conclusions from the data. I am not saying they're perfect, but rather that they're pretty good and by far the best measures we have. What would be your measures to compare citizens across time, or to compare standard of living across the globe?
 
  • #111
CaptainQuasar said:
Dude - you realize that you're almost literally saying "the Market is God" don't you?

Economist said:
I don't even think markets are God. If they were, they'd be perfect. The fact is, markets are far from perfect (although they do work pretty darn well). The real question is how well markets work compared to other realistic alternatives. Usually the most realistic alternative is politics, which is even less perfect than markets.

You didn't say anything about politics, you said that human judgment is an alternative that is inadequate to make decisions different from the results of arbitrage and price equilibriums in markets. You said that an attempt to do so would be "arrogant and elitist". That's regarding market outcomes as something akin to God's Law, which shalt not be questioned.

Knowing that you think this is quite significant to understanding the various views you've presented here and in other threads deriding anything outside of corporate competition as a solution to social problems.

I hate to break it to you, man, but your views literally do have the Enron mindset at their core. Have you seen http://en.wikipedia.org/wiki/Enron:_The_Smartest_Guys_in_the_Room" ? It's entirely apropos to this conversation.

But for the record, I would agree with you that "socialist" type efforts would do well to make more extensive use of market mechanisms as a tool. The California pollution control credit system is an example of a regulatory restricting-commerce-for-the-greater-good measure that leverages a market mechanism. I'm just not putting markets on quite the pedestal that you are.

(This is also what I meant by saying that the Soviet implementation of communism suffered from being drawn on an 1870's understanding of capitalism. If communism were implemented today it would use market mechanisms and active competition, I'm certain, while still keeping enterprise capital in the hands of the state.)
 
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