Alright, when it comes to economics (and a rather large handful of other things), I'm a complete idiot. Aside from some high school accounting classes, basic current awareness classes in college and a general understanding of the world, I've really not the first clue of the differences between Hong Kong and the place where I buy produce when it comes to "open markets".
However, I've long been interested in educating myself in the cool cousin of finance. It's one of those things (like Chinese language) that in since coming to China I've had constantly thrown in my face by continually meeting people more versed in it than me (and with better subscriptions). My interest was piqued again when I returned home this summer, hoping to pick up some books (for dummies) in the English speaking world on economics. My plan failed when there weren't any out and in the ready of the discount bin at my local bookstore (though I did find two books on globalization, which I guess kinda counts).
It was sparked again about 30 minutes ago when I ran across this Currents of Awareness article entitled "What We Learn When We Learn Economics". The artice begins with the loaded question, "is a little economics a dangerous thing?" I intended (and intend) to find out. However, upon realizing that my scrollbar had withered under the weight of its close to 5,000 words… I almost closed the tab and went back to working on something frivolous.
This near action reminded me of a conversation I had (with myself) on the walk to school today. Basically, I've realized lately that I've exchanged what used to be hours and hours of self-education and reading online for even more hours and hours of mindnumbing coding and CSS tweaking. Site design has taken over my Internet life (bring on the oxymoron). Sadly, with another site on deck, that load isn't going to lessen … but I can recognize that it has a pause button. And so I read the article…
…and really learned nothing about economics. But the article wasn't really so much about economics as it was about the divisions in the economics camps, and more specifically the political divisions in the US and how they use economics to further their agendas. It, despite not offering the Econ 101 I was hoping for, is an insightful read. Here's a quote:
But when equity and efficiency trade-offs do arise, economists like Sanderson [the author's economics teacher] are systematically biased in favor of efficiency because that’s what they are experts on. Efficiency they can measure and analyze. Fairness? That’s the turf of philosophers and politicians. This tendency is most pronounced in discussions of economic growth, and how the benefits of that growth should be distributed. Sanderson paraphrases his Nobel Laureate colleague Bob Lucas, who says that “once you start to think about the benefits of high growth, it’s hard to think about anything else.” In other words, first worry about how best to grow the pie, then how to slice it up. Let efficiency trump equity, create wealth, and then you can use the extra wealth you’ve created to alleviate inequality.
This makes a certain amount of sense. But when this rhetoric comes to dominate our politics, the problem of inequality is never addressed. Now is always the time for growing, later is always the time to address concerns about equity. The result is predictable: In countries that have adopted the neoclassical policy prescriptions (including the United States), there has been an ever-widening gap between rich and poor.
This, of course, has a lot of connections to Chinese economics … but like I said, I'm under-read. If anyone knows a good online source for the foundations of economics, I'm all comments.
