Tuesday, July 19, 2016

Economics has various “schools” with ideas on "information." There are economic players, or participants. The schools of thought agree that the economic players obtain information. Do we obtain information? No doubt. Sure we do. It is not in doubt that economic theory covers information, as a theoretical component of its understanding. That is for sure. We all know that getting information is important. Information is in there someplace. I don't doubt it. Getting information is important. While getting the right information is important, there are times when we do not get it. There is more to it, somehow. There must be something else. This something else is, however, not usually explicitly spoken about. What is it then, that is not mentioned, when we focus on "information"? The other element is, perhaps, ignorance! The subject of ignorance should not be ignored. This subject may be divided up as follows. Here is how we do this. We can make a division of ignorance into intentional and unintentional, in the sense that one may be keeping the other people ignorant on purpose  or not. That makes two kinds of ignorance. The sense intended is that you either did it on purpose, or you did not – you knew what you were doing or you didn't. (Maybe it just happened that way.) You did not in the later case restrict information intentionally. That's the idea.
     It can be intentional, as in the case where a seller benefits from some of that good ol' ignorance  no doubt  then, the seller wants it, wants the customer to be in the dark. We may now consider that this is not really customary human behavior. We do not like to keep other persons ignorant in general. (This has some important implications we will omit here) On the other hand, we need to be aware of this. We have to allow it in. It is the “study possibility.  
     If we do not study how ignorance works in economic relations, Well: Then, we are ignorant!

This discussion becomes relevant in the case of mercantilism. This is understood as a system where we have an entire country that tries to bring benefit to itselfit uses a certain strategy in getting profit out of its trade life. There is something peculiar about the study of this practice as other countries, not receiving this "mercantilist reward," could perhaps want to know about it. Back in what one historian assures us they used to call “this manor of England,” a phrase he says was widely used, if a man back then were to, say, publish a book on mercantilism? He might give the whole thing away! The trade partner is the other country (usually it supplies raw material?) – which merely has to read the book. This, I would think, brings us back to the point about intentional, or unintentional, ignorance, as an aspect, for both the study of, and the practice of, economics. ("Enquiring minds want to know" and all that...)

     This shows that ignorance was important under mercantilism. I am concerned with ignorance in economics more for today. But, if ignorance was so important under mercantilism, and we note that it was so, at the country level, why could not ignorance be just as important in the next, upcoming phase of the human economic and social system, as it evolved in Europe? But, this time  in this system on the individual level. Let's now say that in this system (the current one), trade should be for the benefit of everyone, the entire society—that does not seem unreasonable. In that case, we get the situation where ignorance is important to the workings of the system. We get to a situation that can only be described as a situation where ignorance is essential to the system. What we get, then, is a system that not only depends on information, or knowledge, and we can include the system's ideas about so-called “perfect information,” but also depends on ignorance, and thus, ignorance is also necessary, for its proper working. 

     And we hardly talk about this, of course. But are we being ignorant intentionally, or, unintentionally?

Monday, July 18, 2016

"Welfare" in Conventional Economics

If we say there are books on economics, that sure is the truth. There are such books, indeed there are some of  these, and if we look at them we would find out more about what is being discussed. (This a rarer idea than you, the reader, might think it is.) So, I picked out this one book, you see. It is old. One term of discussion that I noticed was “the principle of welfare,” or “social welfare.” OK, then. But what does “welfare” mean, both back in 1928, and today? I would think that in general it might mean something like the overall good or good of the society (implies "whole society"). That would be a kind of basic idea t hat a person might have, and rather a broad idea. But instead what I find is that these writers think that it is a narrow idea, a “principle,” of welfare, which in practice means, “concept.” The concept is going to be used in the area of economics discourse, so one is subsumed to the other, and hence “welfare” becomes just a concept, and so, not much different from any other. Now the "welfare economist" need to slot it in. It has to be slotted in somewhere, within economics, which is to say within that discourse.  

     But let us suggest a much different way to look, which is to surmise that that in fact is economics itself is all about. So, that is different. Now we are seeing the same concept more broadly. There are two possible views that I can see in this regard. We can narrow it down to two, at least. One is that economics is for individuals, with no social welfare involved at all. This is a common enough idea that one encounters (and, in my opinion, wrong). The other idea would be what I already mentioned, that it involves, fundamentally, the whole society. If we were to hold these as two separate, distinct views we might be able to come up with some useful observation or analyses. But this kind of practice of slotting in something called "the principle of welfare," or this practice of making something called "social welfare" a separate concept just seems to be a part of the overall project of social oppression. This is the project these persons are always carrying out! Aren't they? Anyhow, there isn’t much of much interest here and this, naturally, is why we do not read so many of these books. We read the clever, new attempts at it (guys like Tyler Cowen).
     But it was gathering dust on the bookshelf, here at Roosevelt University. Hey, I thought I’d give it a try. I am curious like that. If “welfare” becomes a concept, then where to fit it in economics? This seemed to be the author's concern. This is the kind of thing they go around and around with. I observe that, f you are trying to do something that cannot be done, this may just preoccupy you for a really unlimited amount of time.
     Better to say that the social welfare is the purpose of economics—it is very basic. A person wants to be alive, so s/ he eats, or builds a tent. A whole society wants the same, so the society generates some kind of economic system. So, I would offer  that social welfare is a lot more closely related to economics itself than just being merely another concept, which we may endlessly screw around with, trying to fit the precision phrase ("social welfare" and "the principle of welfare" were phrases I memorized) into one’s intellectual plate, at university! When we take something as basic as the common good or the social welfare, should we just turn it into another ordinary concept? I think we surely end up with just a basket of particulars. This may then pre-occupy us, and for way too long. 
     And it is certainly not worth it to go back to the shelf. Nah... On a quest for the exact title/reference? (I won't bother, but I can say it is a rather oldish book, and it is HB 34 –something; because, it was next to another book, by Coates. But that's another story, now isn't it?).
     I do not think that is the best way for me to spend my time.