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Posts Tagged ‘Adam Smith

“There are people who have money and people who are rich”*…



Every January, to coincide with the World Economic Forum in Davos, Oxfam tells us how much richer the world’s richest people have got. In 2016, their report showed that the wealthiest 62 individuals owned the same amount as the bottom half of the world’s population. This year, that number had dropped to 42: three-and-half-dozen people with as much stuff as three-and-a-half billion.

This yearly ritual has become part of the news cycle, and the inequality it exposes has ceased to shock us. The very rich getting very much richer is now part of life, like the procession of the seasons. But we should be extremely concerned: their increased wealth gives them ever-greater control of our politics and of our media. Countries that were once democracies are becoming plutocracies; plutocracies are becoming oligarchies; oligarchies are becoming kleptocracies.

Things were not always this way. In the years after the second world war, the trend was in the opposite direction: the poor were getting richer; we were all getting more equal. To understand how and why that changed, we need to go back to the dying days of the conflict, to a resort in New Hampshire, where a group of economists set out to secure humanity’s future.

This is the story of how their dream failed and how a London banker’s bright idea broke the world…

The true story of how the City of London invented offshore banking – and set the rich free:  “The real Goldfinger: the London banker who broke the world.”

* Coco Chanel


As we agree that “fair’s fair,” we might spare a thought for David Ricardo; he died on this date in 1823.  A political economist, he developed a a labor theory of value in his seminal Principles of Political Economy and Taxation, published in 1817; he was instrumental in the development of theories of rent, wages, and profits; and at a time of mercantilist sentiment, he introduced the theory of competitive advance and advocated free trade.  Indeed, most economists rank Ricardo as the second most influential economic thinker working before the 20th century, after Adam Smith.

220px-Portrait_of_David_Ricardo_by_Thomas_Phillips source


Written by LW

September 11, 2018 at 1:01 am

“Everybody wants to save the Earth; nobody wants to help Mom do the dishes”*…


Adam Smith once famously observed…

How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it.

Theory of Moral Sentiments, 1759

He is a member of a stream of observers of the human condition, stretching back to the ancient Greeks, who believe that an innate goodness is at work in us all.  But is it so?

Behavioral economists have revolutionized the standard view of human nature. No longer are people presumed to be purely selfish, only acting in their own interest. Hundreds of experiments appear to show that most people are pro-social, preferring to sacrifice their own success in order to benefit others. That’s altruism.

If the interpretations of these experiments are true, then we have to rip up the textbooks for both economics and evolutionary biology! Economic and evolutionary models assume that individuals only act unselfishly when they stand to benefit some way. Yet humans appear to be unique in the animal kingdom as experiments suggest they willingly sacrifice their own success on behalf of strangers they will never meet. These results have led researchers to look for the evolutionary precursors of such exceptional altruism by also running these kinds of experiments with non-human primates.

But are these altruism experiments really evidence of humans being special? Our new study says probably not…

Read more– and draw your own conclusion– at “Does behavioral economics show people are altruistic or just confused?

[TotH to Mark Stahlman]

* P.J. O’Rourke


As we calculate the angles, we might spare a thought for Johannes Schöner; this is both his birthday (1477) and the anniversary of his death (1547).  A priest, astronomer, astrologer, geographer, cosmographer, cartographer, mathematician, globe and scientific instrument maker, and editor and publisher of scientific texts, he is probably best remembered today (and was renowned in his own tine) as a pioneering maker of globes.  In 1515 he created one of the earliest surviving globes produced following the discovery of new lands by Christopher Columbus.  It was the first to show the name “America” that had been suggested by Waldseemüller– and tantalizingly, it depicts a passage around South America before it was recorded as having been discovered by Magellan.  In his roles as professor and academic publisher, he played a significant part in the events that led up to the publishing of Copernicus’ epoch-making “De revolutionibus” in Nürnberg in 1543.



Written by LW

January 16, 2015 at 1:01 am

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