Calculating the "real value" to society of different professions(neweconomics.org)
neweconomics.org
Calculating the "real value" to society of different professions
http://www.neweconomics.org/publications/bit-rich
6 comments
This is a fallacy. The wealth provided by something you buy isn't what you deem it worth. There can be negative externalities. For example, positional goods can mean the good seems worth it to you because it increases your status, but by doing so it just lowers someone else's.
http://en.wikipedia.org/wiki/Positional_good
http://en.wikipedia.org/wiki/Positional_good
I'd like to call your attention to the section of this article that argues against what you're saying.
". . . one era's luxuries are another's commonplace goods. In short, the negative positional externality is often compensated by the public goods of infant industry effects and research and development."
The negative externality view of positional goods seems to be a minority opinion among economists. The examples of positional goods in the article were further quite marginal and it would be difficult to assess what part of the good is positional (and thus deserving of a tax to mitigate the externality) and what part is just valuable.
". . . one era's luxuries are another's commonplace goods. In short, the negative positional externality is often compensated by the public goods of infant industry effects and research and development."
The negative externality view of positional goods seems to be a minority opinion among economists. The examples of positional goods in the article were further quite marginal and it would be difficult to assess what part of the good is positional (and thus deserving of a tax to mitigate the externality) and what part is just valuable.
What value do I provide to the society if I'm able to predict the stockmarket movements? I will end up very rich for sure (meaning I will hold a lot of assets that other people's work created) without having contributed anything in the general production of goods and services and without commiting any fraud or getting help from government.
This paper does nothing to calculate any "real value" and is just a collection of biased and discredited arguments.
Example of one of the arguments: "They have supported the propagation of the misguided view that tax cuts are good for stimulating growth and even increasing government tax revenues. The Nobel Prize- winning economist Paul Krugman claims that this is not true in the context of the United States."
That's the best they can do? Because Krugman says so? This paper is a joke.
Example of one of the arguments: "They have supported the propagation of the misguided view that tax cuts are good for stimulating growth and even increasing government tax revenues. The Nobel Prize- winning economist Paul Krugman claims that this is not true in the context of the United States."
That's the best they can do? Because Krugman says so? This paper is a joke.
I didn't see one chart or table in that entire paper; the myths & "wanted ads' show a clear bias; this merely propaganda.
This paper is backed by no scientific data, is totally biased and is so wrong on so many arguments that I don`t even know where to start. Full disclosure: My salary sucks.
http://ftalphaville.ft.com/blog/2009/12/14/111101/how-much-a...
FT: And before you start nitpicking the numbers, a word of warning from the study:
"Our Social Return on Investment analysis is not just an intellectual exercise – it has big implications for the way in which our society and economy are structured. Financial incentives are very powerful, and we tend to shower them on some of the professions that are the most socially and environmentally costly. This promotes undesirable behaviour, while positive activities are discouraged. .... We have not aimed for precision in our calculations – there may be aspects of value that were left out. The point was to draw attention to the issue. We have not included detailed recommendations because it is clear to us that there are deep structural issues that need to be addressed, and change will not come overnight."
On that wider `issue’ note, prepare to forget almost every economic theory you’ve ever heard.
According to the study, the City of London is not essential for the UK economy (manufacturing, apparently, is much more important). Low-paid jobs don’t create a ladder for people to work their way up — social mobility is flat. The UK doesn’t need high salaries to attract and retain talent, since higher salaries don’t necessarily reflect the best people available. Etc.
FT: And before you start nitpicking the numbers, a word of warning from the study:
"Our Social Return on Investment analysis is not just an intellectual exercise – it has big implications for the way in which our society and economy are structured. Financial incentives are very powerful, and we tend to shower them on some of the professions that are the most socially and environmentally costly. This promotes undesirable behaviour, while positive activities are discouraged. .... We have not aimed for precision in our calculations – there may be aspects of value that were left out. The point was to draw attention to the issue. We have not included detailed recommendations because it is clear to us that there are deep structural issues that need to be addressed, and change will not come overnight."
On that wider `issue’ note, prepare to forget almost every economic theory you’ve ever heard.
According to the study, the City of London is not essential for the UK economy (manufacturing, apparently, is much more important). Low-paid jobs don’t create a ladder for people to work their way up — social mobility is flat. The UK doesn’t need high salaries to attract and retain talent, since higher salaries don’t necessarily reflect the best people available. Etc.
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While I'd love to see the working out of a rigorous methodology for studying this, that particular article and study is shot through with politics.
I would really like to be able to better answer the question: how much am I contributing? But it seems like too difficult a question to gain much traction on, especially if politics leaves you blind.
I would really like to be able to better answer the question: how much am I contributing? But it seems like too difficult a question to gain much traction on, especially if politics leaves you blind.
If someone makes money, it means someone values the things they produce. Government regulation/help and fraud aside - wealth and income represent contribution to society. If you buy an Ipod its because its worth more to you than the money you spend on it. If you buy a loaf of bread its because you value the loaf of bread. The fact that the farmer and Apple provide you with the things you need doesn't give you the right to enslave them.
You don't have a right to healthcare, to healthy food, to haircuts, to welfare, or even to happiness at my expense. You have the right to PURSUE happiness, not the right to be happy.
This paper is nonsense.