tag:blogger.com,1999:blog-28755195.post862669100819493613..comments2023-09-25T04:26:51.568-06:00Comments on The Barefoot Bum: UnemploymentLarry Hamelinhttp://www.blogger.com/profile/08788697573946266404noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-28755195.post-29404891425711371482010-01-11T07:03:19.318-07:002010-01-11T07:03:19.318-07:00If you'd like to see the multipliers "rig...<i>If you'd like to see the multipliers "rigorously documented," you can find it in my book.</i><br /><br />If you'd like to send me a free copy, I'd be happy to read it.<br /><br /><i>You're willing to shrug off the entire housing sector...</i><br /><br />I'm not "shrugging off" the entire housing sector. I'm noting that it's a matter of established fact that residential housing is at best less than 10% of GDP, and your thesis relies on relative differences between that 10% in different countries. Assuming that these differences are at most 20% in developed countries, we're talking 2% of of GDP. Which is a fair amount of economic activity, but doesn't seem enough by itself to have profound macroecnomic consequences, even for Japan, a <i>physically</i> small archipelago relative to its population. <br /><br />Indeed, Japan by itself is a huge <i>prima facie</i> counterexample to your thesis: a very dense nation with a relatively high <i>per capita</i> standard of living. Russia, a physically huge and sparse country with a relatively low standard of living, also seems like a counter-example.<br /><br />However, housing by itself is not why I'm suspicious of your grasp of economic fundamentals. I'm suspicious because your comments here <i>appear</i> to confuse real and nominal economic efficiency. I could be wrong, but its up to you to correct my impression.<br /><br /><i>[I]t seems that my lack of understanding is surpassed by your denial and closed-mindedness.</i><br /><br />Labeling criticism and a request for evidence as denial and close-mindeness is a classic symptom of crackpottery.Larry Hamelinhttps://www.blogger.com/profile/08788697573946266404noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-92209668656714432902010-01-11T06:11:25.516-07:002010-01-11T06:11:25.516-07:00If you'd like to see the multipliers "rig...If you'd like to see the multipliers "rigorously documented," you can find it in my book. <br /><br />Regarding the housing data I presented, it's clearly presented in terms of per capita dwelling space, not the cost of housing. <br /><br />Japan is not "a small island." It's the second largest economy in the world. You asked for an example. I gave you one. The same relationship holds true for other nations. <br /><br />You're willing to shrug off the entire housing sector of an economy and you accuse me of "not understanding economics?" While I don't profess a complete understanding of the subject (only a fool would), it seems that my lack of understanding is surpassed by your denial and closed-mindedness.Pete Murphyhttps://www.blogger.com/profile/16549342862438864973noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-71654273501884641782010-01-10T11:28:47.509-07:002010-01-10T11:28:47.509-07:00In short, Pete, I'm not convinced that you und...In short, Pete, I'm not convinced that you understand economics at a very deep, fundamental level, which I don't intend as a put-down: economics is harder to understand than philosophy, for much the same reason: the promulgation of vast quantities bullshit by supposed authorities.Larry Hamelinhttps://www.blogger.com/profile/08788697573946266404noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-62602660220048146472010-01-10T11:27:11.961-07:002010-01-10T11:27:11.961-07:00"[Housing is] just one example of the correla..."[Housing is] just one example of the correlation between population density and per capita consumption..."<br /><br />That doesn't sound like one example, that sounds like the whole enchilada, and only under extremely specialized circumstances (a highly industrialized nation on a small island).<br /><br />And I'd like to see the effect on multipliers (the "consumption of everything used to build, furnish and maintain a home") rigorously documented. Even so, investment in residential housing is less than 10% of GDP in the US, so I don't see why a 10% or 20% difference in that number between two countries would make all that much difference, or how you could even <i>tell</i> if 1% or 2% was actively transferred to other consumption.<br /><br />But it's more important, however, to understand what metric of consumption you're using. If we're talking about consumption of <i>costs</i>, then as we produce the same amount of use value for the same amount of cost, it will look like consumption is being reduced, when it is merely being made more efficient in real terms. Such a fall in cost consumption is not an economic problem; indeed in real terms it's a Good Thing. The only "problem" in the moral and political sense, in that beyond a certain point, gains in real efficiency undermine our moral and political constructions underlying the allocation of effective demand.Larry Hamelinhttps://www.blogger.com/profile/08788697573946266404noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-57161655776725346952010-01-10T10:57:27.503-07:002010-01-10T10:57:27.503-07:00Here's just one example of the correlation bet...Here's just one example of the correlation between population density and per capita consumption that I've provided in my book: housing (or "dwelling space" - the term used by the UN). Consider the difference between Japan and the U.S. Per capita dwelling space in Japan, a nation ten times as densely populated as the U.S., is less than one third of Americans', not because the Japanese like living in cramped quarters but because there is no room for anything else. The per capita consumption of vehicles is similarly affected. So too is virtually everything, to a greater or lesser extent. <br /><br />Think about what that does to the per capita consumption of everything used to build, furnish and maintain a home. All of it is cut proportionately. Therefore, so too is their per capita employment in these industries. Not a problem as long as the per capita consumption of something else is so much greater that the labor freed up by low consumption in the housing market is absorbed somewhere else. But it isn't. This is why every densely populated developed nation on earth is utterly dependent on manufacturing for export in order to gainfully employ their labor forces, robbing the employment in manufacturing from those countries who must bear corresponding trade deficits, countries like the U.S.Pete Murphyhttps://www.blogger.com/profile/16549342862438864973noreply@blogger.comtag:blogger.com,1999:blog-28755195.post-42135595334887425692010-01-07T17:40:49.759-07:002010-01-07T17:40:49.759-07:00[T]he field of economics doesn't account for t...<i>[T]he field of economics doesn't account for the relationship between population density and per capita consumption.</i><br /><br />Interesting. What <i>is</i> this relationship? How can you demonstrate it?<br /><br /><i>[A]n in-depth analysis reveals that, of our top twenty per capita trade deficits in manufactured goods (the trade deficit divided by the population of the country in question), eighteen are with nations much more densely populated than our own.</i><br /><br />That's certainly <i>suggestive</i>, but it's not at all <i>revealing</i>.Larry Hamelinhttps://www.blogger.com/profile/08788697573946266404noreply@blogger.com