User:Firulaith/sandbox

== The Meaning of Scarcity ==

This section is being writing for the benefit of Norwood who I believe is a swell gay. Norwood hit hard on several issues; but I am going to start with scarcity, since we can not go further in discussing how to improve the Wikipedia article head portion of economics without having some common ground concept of scarcity.

In a modern market economy scarcity is represented by the budget restrains of all participants. Almost everybody feels that they don't have enough income to buy all the things they want. Shops, supermarkets, auto-lots may burst with stuff; but they are there for display only; Good Things which are withing a man´s reach, but never all withing his grasp. People cannot act like children in a supermarket and take home all the stuff they want; they have to pay for it first. It is expected that people try to do their best they can with their limited income to maximize their well being. This means that they have to do anguish choices, given up some quantity of stuff just to have a little more of another.This given up is what economist means by scarcity. No scarcity means that people can have it all and that they don´t have to give up anything at all.

The market makes available a dazzling array of products, but every acquisition is simultaneously a deprivation of something else, so scarcity reigns supreme. The more we have, the more we lack. Production and distribution are arranged through the behavior of prices, and all livelihood precariously depend on getting and spending. Therefore, insufficiency of material means (scarcity) becomes the explicit, calculable starting point of all economic activity. We cannot tell an average family or an individual struggling to have ends meet, from paycheck to paycheck, that there is no scarcity anymore.

John Kenneth Galbraith assertion that, we, in developed countries, live  in an affluent society because industrial productivity have grown so high that "urgent goods" have become plentiful is a misconception of scarcity. It is true that almost all in those societies can afford some regular food, some clothes, and minimal shelter; and the basic necessities of the homeless and needed could be easily provided. But that is not the point, since almost nobody in those societies are content with only having their basic necessities met. It is the disparity between wants and the means for their fulfillment (enough income) that define scarcity.That is exactly why Marshall Sahlin elucidated that the original affluent societies are the aboriginal Australians, the bushmen of the Kalahari in Africa, the hunters and gathering natives of the Labrador peninsula in Canada and Tierra de Fuego in Argentina, and others; because, they enjoy a "kind of material plenty", even if they don't have running water or electricity.

According to Sahlin: want not, lack not. The wants of those people are so low that their means for fulfillment are plentiful. A study of aborigines in Australia by McCarthy and MacArthur (1960) showed that those people don't work hard and they don't work continuously. Their subsistence quest would stop when they had procured enough for the time being.They worked and average of 15 hours a week.The time they don't work in subsistence, they pass in leisure or in leisurely activities such as taking long daylight naps, playing with children and others, partying, and enjoying the gifts nature. Consequently those people are free of material pressure because they don't have to give something for something else; in a way they have it all and live in a world of plenty, all their wants and needs fulfilled to the fullest. Another way to plenty is the Buddhist Zen approach which teaches us to renounce to all wants and desires and dedicate ourselves to contemplation and meditation for happy and meaningful lives.

What is the use of economics for the bushmen of the Kalahari? None.Not for distribution or consumption because everybody gets all what she/he wants to the point of satiation. Neither production because of the simplicity of technology and easiness for anyone of acquiring the means of production from materials which lay in abundance around them and which were free for anyone to take: wood, reeds, bone for weapons and implements, fibers for cordage, grass for shelters, etc.; and finally, not even for making economic choices because they don't have to make any.

Sustain overproduction only happens when the economy is on a free fall.

== Updating definition of Economics ==

Defining economics as "the social science that studied economic activity" do not say much. It is like saying that philosophy study philosophical thinking, and physics study physical phenomena, and history study historical developments. And, as Janosabel says in Talk:Economics, production itself needs to be defined as the transformation of nature-given materials into a form useful in satisfying human needs, to clarify the definition. Also, since we are taking about distribution, we are presupposing that the "economic activity" takes place in a social setting where distributions is a must, not in a situation in which there is only one individual doing the "economic activity".

Of course, economics only analyzes certain aspects of production, distribution, and consumption. It doesn't deal of production from the administrative perspective (management or production problems); neither refers to the step by step process which ends in a final product; nor studies the transformation technologies. For some it studies the social relations which give rise to the exploitation of a social class by another; for others it studies the public and private choices concerning the use of scarce resources. Still, there are a myriad of micro-issues that are part of economics but they don't remotely have anything  to do with production, distribution, or consumption: issues in education, law enforcement, and airline safety among many others.

Here is an example for the airline industry. Safety is a big concern of everyone who flies or contemplates it. We are nineteen times safer in a plane than in a car, according to Arnold Barnett, MIT professor of statistics and an authority in the subject. In order to save lives, a safety proposal for the airline carriers may be under consideration; but if the proposal increases airline ticket prices or multiplies air travel inconveniences, it may end costing more lives than it saves, if it pushes enough people onto the road. Therefore, economics must be considered for any airline security proposal.

Borrowing from Princeton professor of economics Elizabeth C. Bogan, "economics is the study of how people and societies deal with scarcity." If there is such an abundance of goods and services that everybody is able to consume anything he/she wishes to the point of satiation, then there is no scarcity and the study of economics has not point. Everybody would be extremely wealthy and can waste resources at will. In the case of safety for the airline industry, everybody would pay for the increase of the airline tickets i regarding of it cost. No social issues would arise and no painful choices has to be made. But scarcity is a fact of life. As Lionel Robbins said: time is limited, life is short, and nature is niggardly. Production is only a way people and societies deal with scarcity.

Economics only analyzes certain aspects of production, distribution and consumption of wealth. According to Robbins, economics is about choosing among alternatives. It does not study production as a process or the different techniques to produce a thing; neither study management nor production problems. What it says is that if there is more than one way of producing a thing, the least costly alternative is always chosen in the long run. In the consumption case, it says that among the different bundles of goods and services the consumers can buy with their income they will choose the one which provides them the most satisfaction. Distribution, is the remuneration paid to the owners of labor, capital and land; and, once production is determined (the what and how), so is it distribution (for whom), in the form of wages, profits, and rent.

As a result, economic analysis is not restricted to how wealth is produced, consumed, and distributed. Although wealth is a major topic, economic analysis can also be applied to education, crime, war and any other subject for which different options are taken into consideration by the concerning parties. Economics can study for example how individuals choose between labor and leisure, work and education, and saving and spending. It study how business decide on and pick out capital investment projects. It studies how governments prepare and decide on their budgets.

Here is a simple example of an economic analysis applied to the airline industry as an illustration of a topic different than wealth. Safety is a big concern of everyone who flies or contemplates it. We are nineteen times safer in a plane than in a car, according to Arnold Barnett, MIT professor of statistics and an authority in the subject. In order to save lives, a safety proposal for airline carriers may be under consideration; but if the proposal increases airline ticket prices or multiplies air travel inconveniences, it may end costing more lives than it saves, if it pushes enough people onto the road. Therefore, the way people make choices on their travel options (economics) must be considered in any airline security proposal.

Robbins wrote his essay for fellow economists. I present below a less arcane definition, closely based on Robbin's ideas, for consideration and review of the Wikipedia public.

'''Economics is the social science that studies human behavior as a relationship between desired ends and versatile scarce means. First, economics studies public and private choices concerning the allocation of scarce resources to competing ends, because when ends can be arranged in order of importance (are value), behavior adopts the form of choice."UNIQf457fd53f310fe30-ref-00000012-QINU. People and society busy themselves in solving the ever present problem or dilemma of choosing among alternate courses of actions and uses of their scarce resources, as choosing one alternative means foregoing another, what economist call opportunity cost. When people and society try to solve this problem they are economizing -going through a logical process of choosing among alternatives. This is the central issue in economics and the reason the science exist. And second, the allocation activity is a dynamic process changing and adjusting for every period according to the technical and social environment and the scarcity conditions of resources. Economics studies the successive series of allocation events as they move toward a steady state, what economists call equilibrium. Then, economics tries to discover the equilibrium conditions and evaluates the consequences and implications equilibrium has for the individual, for a segment of society and, in the aggregate, for society at large.'''

You may ask what about heterodox economics. These approaches are based on history, power, institutions, natural systems and uncertainty; and, in their relentless criticism of mainstream economics and its assumptions. Robbings regarded these approaches as different disciplines of the economic science and calls them either political economy, descriptive economics, applied economics and so forth and that they deal mainly with the political and social environment in which the economic subjects make their allocation decisions. An article of Wikipedia says: "Mainstream economists sometimes assert that heterodox economics has little or no influence on the vast majority of academic economists in the English speaking world. Heterodox schools of economics are also usually dismissed as "fringe" and "irrelevant" by prominent mainstream economists".UNIQf457fd53f310fe30-ref-00000013-QINU; and "David Colander, an advocate of complexity economics, argues that the ideas of heterodox economists are now being discussed in the mainstream without mention of the heterodox economists, because the tools to analyze institutions, uncertainty, and other factors have now been developed by the mainstream. He suggests that heterodox economists should embrace rigorous mathematics and attempt to work from within the mainstream, rather than treating it as an enemy".UNIQf457fd53f310fe30-ref-00000014-QINU Firulaith (talk) 02:36, 17 July 2014 (UTC)(talk) 21:01, 16 July 2014 (UTC)


 * References supplied by Firulaith

Wikipedia articles do not represent our personal opinions, they are our best attempts to represent what the mainstream academics in the subject have published about the topic. -- TRPoD aka The Red Pen of Doom  03:28, 18 July 2014 (UTC)

What I am proposing is to use Lionel Robbins' definition instead of Jean-Baptiste Say's definition which has become obsolete. It has been long struggle, but Robbins's definition is now the most widely acepted by today mainstream economists (see Reference [1]). What I doing in this talk pages is to persuade you and other wikipediam to accept it. The definition I am proposing in the first sentence of the paragraph in bold is not mine but it is 100% Robbins' (see Reference [2] p. 16). Firulaith (talk) 04:11, 18 July 2014 (UTC)

Scarcity, value, choice, economizing, opportunity cost, and equilibrium are basic concepts of pure economic science. They are applied from an isolated man in a forgotten island, to the global economy with its intricate web of social, political, economic relationships. Pure economic science does not presuppose the existence of exchange, distribution, institutions, social relationships, or mode of production. A single isolated man in a forgotten island, as well as a patriarchal, medieval, capitalistic, or socialistic societies deal with those concepts on a daily basic. Firulaith (talk) 19:02, 18 July 2014 (UTC)


 * I'm following this discussion with interest. It reminds me of the last major rewrite of the article mathematics.  There the mathematician's definition: mathematics is the method of deduction applied to precise definitions and axioms, lost out to the lay definition: the study of numbers and shapes.  The definition of economics in this article is currently the lay definition.  Will you succeed in replacing it with the economist's definition?  If so, you need to render the economist's definition briefly and clearly, avoiding words such as "versatile", which I assume means that "your money or your life" is not an economic transaction. Rick Norwood (talk) 23:36, 18 July 2014 (UTC)

Proposed Opening of the Economics Article
At the dawn as a social science, economics was defined and discussed at length as the study of production, distribution, and consumption of wealth by Jean-Baptiste Say in his "Treatise on Political Economy or, The Production, Distribution, and Consumption of Wealth" (1803). These three items are considered by the science only in relation to the increase or diminution of wealth, and not in reference to their processes of execution. Say's definition has prevailed up to our time, saved by substituting the word "wealth" for "goods and services" meaning that wealth may include non material objects as well. One hundred and thirty years later, Lionel Robbings noticed that this definition no longer sufficed because, many economists were making theoretical and philosophical inroads in other areas of human activity. Then, he proposed a definition of economics as a study of a particular aspect of human behavior, the one falling under the influence of scarcity,[2] which forces people to choose, allocate scarce resources to competing ends, and economize (seeking the welfare while avoiding the waste of scarce resources). For Robbings, the insufficiency was solved, and his definition allows us to proclaim, with an easy conscience, education economics, safety and security economics, health economics, war economics, and of course, production, distribution and consumption economics as valid subjects of the economic science.

Citing Robbings: "Economics is the science which studies human behavior as a relationship between ends and scarce means which have alternative uses".[3] After discussing it for decades, Robbings's definition became widely accepted by mainstream economists, and it has opened way into current textbooks.[4] Although far from unanimous, most mainstream economists would accept some version of Robbings' definition; even though, many have raised serious objections to the scope and method of economics, emanating from that definition.[5] Due to the lack of strong consensus, and that production, distribution and consumption of good and services is the prime area of study of economics, the old definition still stands in many quarters.