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Author Topic: Economic Pseudo-Science  (Read 1766 times)

Offline psikeyhackr

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Economic Pseudo-Science
« on: 15/04/2009 03:55:37 »
In a way this doesn't belong here since Economics is not a SCIENCE.

But it appears our economists have not been able to solve a grade school algebra problem for quite some time.

There have been 200,000,000+ automobiles in the United States since 1995.  If each car lost $1,500 in depreciation each year that comes to $300,000,000,000 lost on automobile depreciation every year.  I don't know what percentage of those cars are CAPITAL GOODS.  So with FOUR TRILLION lost since 1995 that the economics profession completely ignores why do we expect them to come up with any solutions to our current problems.

http://discussions.pbs.org/viewtopic.pbs?t=28529

Of course that is just cars.  Televisions, air conditioners. lawn mowers are all ignored too, but they were added to GDP when they were purchased. This is not just about the United States however, demand Side depreciation is ignored all over the world.

But then economics is not a SCIENCE, so who cares?

psik


 

Offline Vern

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Economic Pseudo-Science
« Reply #1 on: 16/04/2009 04:54:08 »
I think that would fall under the heading of consumption. We consume the GNP. That is a whole another thing from production. We produce so that we can consume. If we consume less than we produce, we have a surplus. We get into trouble when we insist upon consuming more than we produce. I think that is were we are now.
 

Offline psikeyhackr

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Economic Pseudo-Science
« Reply #2 on: 18/04/2009 19:03:28 »
I think that would fall under the heading of consumption. We consume the GNP.

Let's keep the abstraction separate from the reality please.

GDP MAY BE a measurement of what we consume but it is not what we consume.

Are you saying an automobile is like a banana?  Did someone make design decisions about the banana that affected how long it would last?

How often do you hear economists talk about NET DOMESTIC PRODUCT?

Suppose automakers could make cars last twice as long and cost half as much?  But to do that they had to stop redesigning them every year and not make as many models.  That would mean 1/4th as much depreciation.  But if Americans drove just as many miles would that still be the same consumption?

I am simply saying economists' equation for NET DOMESTIC PRODUCT is WRONG.  And that they should compute and report DEMAND SIDE DEPRECIATION.  Of course I think mandatory accounting in the schools would help too.

psik
 

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Economic Pseudo-Science
« Reply #2 on: 18/04/2009 19:03:28 »

 

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