In Toolbox Theory deficit spending by the government results directly in GDP growth. This matches no historical or modern economic theory, would not be endorsed by any historical or contemporary economist, and is a fundamental misrepresentation of economics. The direct result of this is going to be a bunch of TNO players spouting the idea that government spending = GDP growth, which will be to the detriment of the playerbase, simply because it's irresponsible to let people think that.
This does not particularly concern the gameplay mechanics of TT, although I think it's perfectly conceivable to either add a multiplier effect determined by focus trees+events or a different method of calculating GDP growth, but that does not affect the further content of this post. I will counter the claim "but it is this way because it is simpler" with the response that including both interest rates and inflation means you are already creating a thorough macroeconomic model and should see it through completion, and not include something fundamentally inaccurate. Furthermore this is the whole reason I made this post - you now have a whole gang of TNO players who genuinely, avidly believe that unlimited deficit spending will resulting in unilateral economic growth, with the same fervour they usually have for the memes and ideas that whip up in this community, and in the interest of good governance and economics that shouldn't be encouraged.
I understand that most of the people reading this will have never studied any (macro)economics before, and that's fine. You may say to yourself "why should I trust you over the TNO devs", the answer being that the TNO devs did not invent the concept of inflation and interest rates and government spending, and that these have been long studied, and that everything in TT is based on these real life, real-studied concepts. As such you should refer to the real theory, which as I stated before, does not endorse government spending directly increasing GDP growth, even amongst the most heterodox of liberal economists.
Ok I got you with the flashy title and intro, now here's the economics. I will briefly explain what what GDP is, what deficit spending is, how government spending affects GDP, the multiplier effect, and then why it is agreed that government spending only SOMETIMES causes the economy to grow.
GDP
Most modern economists now measure GDP through 'aggregate demand' - the total demand for goods and services in a given econom
... keep reading on reddit ➡Do economists still use the labels "Austrian," "Neoclassical," or "Keynesian" anymore? I never hear economists use or refer to these terms, they sound old-fashioned, and seem pretty unscientific to me. How can you be a dispassionate, analytical scientist if you acknowledge that your work is guided by an ideology?
Do Neo-Libs advocate for stimulus as a means for recovering the economy or just cutting spending and cutting taxes during times of recession.
I have been reading a number of more post-keyensian works recently, like that of Steve Keen, and one thing I find is that a lot of it has elements of more classical marxism, however some of those elements are modified/changed. That's basically what neo-marxists do right? Revise and expand upon old marxist thought?
So what's the difference? Like, what sets the two apart?
Hi guys, I am looking for more knowledge around economics. I have been regularly hearing that trickle down economics simply do not work. And that statement is convincing as it's been the status quo for decades and nothing has changed, Bernie was hilarious when he said "We already do have socialism in this country, for the rich!" However, the same way marxists say "That wasn't real communism." whenever confronted about Stalinism, Maoism, Castroism, or Venezuela, I might argue that the US economic system isn't real capitalism, it is a crony capitalist, plutocratic, corporatocracy. The reason we may have monopolies and unethical big business is because of bribes, donations, and lobbying which then results in subsidies, bailouts, and stock buybacks, and the like. I don't think we actually do live in an authentic free market. However, I have found that listening to and reading about people like Milton Friedman and Thomas Sowell is very enlightening, they both as individuals want to address how to build healthy economies where everyone can participate, and they are both articulate and their reasoning is pretty sound and well thought out, which actually makes me think that the notion that people on the right are all kleptocrats who don't give a damn about the vulnerable is kind of a strawman. I do think that all people are basically selfish, and so I don't think that trickle down economics work, if you empower fat cats too much, all they are going to do is enrich themselves and the wealth will never trickle down, but that's not what the Chicago School or the Hoover Institute are advocating for, They want NO government intervention except for some things like UBI and a negative income tax and school vouchers, and by extension, no bribes to facilitate that, it's just that Reagan and the subsequent republican administrations have bastardized those teachings into crony capitalism, and corporate welfare which in fact does skyrocket the national debt and inflation. With all that being said, who are some left wing economists that are at the same caliber of academic prestige as these guys who are nobel laureates and have had illustrious careers at the world's most pretigious universities. I want to know so I can manage my biases and analyze all sides of the story.
I often see words like "Capitalism requires infinity growth", and "capitalism is about mindless consumption" or a combination of both "capitalists will mindlessly consume every natural resource for profit". Which is completely false.
Precisely because of thoughts like these, that socialists claim that capitalism requires infinite growth and infinite increase in production, consumption of resources and mindless consumption by customers.
Stop the misinformation pls.
The only capitalist economic theory that encourages mindless consumption of goods/resources and rejects saving ans investing as means to move the economy is Keynesian Economics (MMT) as explained by Keynes himself with the Paradox of Thrift.
AND most importantly, the destruction or consumption of goods/resources can never be a positive in a capitalist economy because the owner of a broken good will spend money (consuming his capital/resources) to fix it, resource that could've been used somewhere else other than fixing stuff, as shown by Bastiat in his idea of The Broken Window Fallacy.
Fallacy which comes from the false Keynesian idea that spending, even if it is to replace something broken, is better than saving. Thought that has its roots in the idea that it is consumption that moves the economy, same mistake as socialists that say stuff like those mentioned in the beginning.
Even MARX himself knew that capitalism wasn't about consumption/spending of resources/capital, but about saving, about accumulating capital.
If any of you are interested in understanding capitalism, you can look for Hayek and Bastiat as the opposite of Keynesian economics, as well some of Milton Friedman's interviews.
I spent some time searching good and short videos that serve as basic introduction to some ideas.
Keynesian vs Austrian economics in 1 min
Money Creation, Inflation and Debt - Short and quite good explanation of the Austrian view of inflation, as well as a bonus to explain our exorbitant debt that keeps increasing.
A debt based economy only makes sense if you believe that borrowing and spending money today can help the economy instead of having this money in the future. Which makes a quite good lead to the next video.
Austrian Business Cycle Theory - Basically the idea that government spending (increase in money supply) or
... keep reading on reddit ➡In the 1930’s the father of macroeconomics wrote a book titled "Economic Possibilities For Our Grandchildren." In this book he envisioned a world in which productivity per worker would reach such high levels through the utilization of both human and physical capital that wealth and conformed could be easily attained in a work week as low as 15 hours per week. This is not meant to be an upper limit, but rather a minimum by which a worker could attain a respectable way of life. His projections of productivity ended up being relatively accurate, but the ultimate tragedy was that his ideas about the change in work culture completely missed the mark. What’s interesting is that the trends that prevailed when his ideas were widely utilized for the first time seem to justify his vision as inevitable, between rapid unionization, stabilization policies enacted by a more activist government, and the rapid advancement of technology.
So what went wrong? The oversimplified answer is that the ruling class would see these advancements in productivity as a new opportunity to push working classes to new levels of efficiency capable of producing astounding amounts of wealth, which inarguably has been achieved. Captains of industry do create visions that ultimately improve our way of life as consumers. What gets lost in this ideology is the fact that every consumer is also a worker. Consumers acquiesce to the conveniences of capitalism without having any mechanism to push back on the aspects of their identities as workers, with the stigmatization of unions and lack of government policy to support the employee class. Understanding this duality of identity of everyone being both a consumer and a producer is pivotal and must be reconciled. Workers with higher incomes feed the consumerism and keep the money moving and raise the standard of living for everyone participating.
So how do we solve this dilemma? Many workers around the world are engaging in tactics that have been proven to work in the past. Skilled worker strikes have been popping up recently and achieving moderate success. But there has to be more tactics employed to reach a wider range of working people that could benefit from better work/life balances and higher wages are the ultimate key that would allow people to make that balance choice. And ultimately, this pressure can only be achieved through political participation.
This is an incredibly disheartening answer considering the political climate of the past s
... keep reading on reddit ➡
ELI5. What are the different theories on growth? (classical,neoclassical,endogenous,marxist,post-keynesian?,austrian?). Can an economy restricted of monetary resources achieve growth?
In one the recent Peter McCormack videos, one of the guests said PoS is Keynesian.
What do you think he meant by that?
Despite Bitcoin being PoW, I'm posting this question in this sub and not CC, because bitcoiners generally have more interest in macroeconomics and are better able to argue for PoW over PoS.
Hi,
I am doing a school project on the effects of Quantitative Easing (QE) and most of my research has led me to gloom-and-doom takes on it, but I am wondering what is the middle ground keynesian/neoliberal take/rebuttal to these points below:
- CPI has increased 2,911% ($1 1910 = $29.11 2021) since 1910 with the money supply (m2) increasing over 7,000%
- When the Fed prints money, it goes into assets (stocks, real estate, etc.) therefore artificially increasing asset prices and worsening wealth inequality
- the wealthiest 10% of Americans own a record 89% of all US Stocks
- when the Fed engages in this easy monetary policy of printing money through QE and 0% interest rates, doesn't it increase wealth inequality and inflation while also making the markets and economy ever more dependent on the Fed?
- The Fed (& other central banks) are artificially increasing the demand through QE since March 2020 which is exacerbating the "supply chain shortages." There is always a shortage in stuff and when demand outpaces supply it causes prices to increase and/or shortages to occur. Contracting and expanding the money supply in tandem with supply & demand is what the Fed was created to due, but since they've levered up the everyone with so much debt, they can no longer contact the money supply without triggering a sovereign debt crisis.
Thanks for the rebuttals!
Origin Keynesian economic is a macroeconomic model that used to identify the equilibrium level, and examine disruptions, total production and income. Equilibrium is when total production and income i.
Hi,
In this video I cover the wealth tax and explain why Monero has an historical importance to give freedom back to the people
Hope it's useful!
https://www.youtube.com/watch?v=U-Gtia-T-XI
Hint: turn on captions
The "security" fiat currency supposedly provides has not stopped muggers, Wall St., the Fed, or the Treasury from robbing us of our capital. Fiat's security has disproportionately secured currency issuers, while leaving the majority financially insecure.
The "liquidity" fiat currency supposedly provides an economy has dramatically transformed a trickle of metal debasement practiced by governments for millenia into a raging river siphoning from all pockets with a click on a monetary policy keyboard. Fiat's liquidity has liquified hard assets to flow ever more efficiently out of the pockets of those who work into those who issue currency.
Silver secures your sweat equity and resists involuntary liquification and flow out of your pocket.
Defying fiat currency perpetrators restores real security and freeing trade from manipulators restores real liquidity.
I have been reading a number of more post-keyensian works recently, like that of Steve Keen, and one thing I find is that a lot of it has elements of more classical marxism, however some of those elements are modified/changed. That's basically what neo-marxists do right? Revise and expand upon old marxist thought?
So what's the difference? Like, what sets the two apart?
I have been reading a number of more post-keyensian works recently, like that of Steve Keen, and one thing I find is that a lot of it has elements of more classical marxism, however some of those elements are modified/changed. That's basically what neo-marxists do right? Revise and expand upon old marxist thought?
So what's the difference? Like, what sets the two apart?
Origin Keynesian economic is a macroeconomic model that used to identify the equilibrium level, and examine disruptions, total production and income. Equilibrium is when total production and income i.
