Economics

Video Series on Economic Indicators

Video Series on Economic Indicators
By Alex Merced

I’ve been doing videos on economic theory for years at LearnEconomicsNow.com but am now doing a project more geared towards application of economic knowledge.

Last weekend I picked up the book “the secrets of economic indicators”, and decided to do a series of videos about all these indicators.

In these videos I discuss these indicators impact on the market, what they tell you about the economy, and how they are put together.

I have created a playlist just for this series which you can find at indicators.learneconomicsnow.com.

If you enjoy my work and would like to show a token of support please make a pledge at patreon.com/alexmerced of as little as $1/mo or more.

Libertarianism & Free Exchange

from Alex Merced

I’m Libertarian and I’m for Free Exchange, which are not exactly me saying the same thing twice.

When I say I’m libertarian, I’m just saying I value an individuals right to their property and don’t want me or others to aggress on their property, mainly cause I don’t want anyone to do that to me so it only makes sense I should approach others the way I want them to approach me. Although this does not imply any particular doctrine of what is the optimal property rights framework, economic system, or make up of society… just that I don’t want people to aggress on each others property (which includes you body in just about all property right frameworks)

When I say I’m for free exchange, I am making a normative statement, that a world where the barriers to exchange between individuals are as little as possible will yield better social results. Thus, I do believe in removing barriers that come from aggression (basically government intervention, organized crime and cartelization, etc.) but I also believing in making non-aggressive (so fixing without policy) efforts to remove non-aggressive barriers to exchange (social intolerance, lack of access to information, technological barriers).

Although Libertarianism and Free Exchange line up when it comes removing aggressive barriers to exchange, Libertarianism in it’s purest broadest has nothing to say about what or whether anything should be done about non-aggressive barriers.

Point I’m saying is ones own personal philosophical framework is never made up of one principal or value, but of many.

And honestly, keeping them separate is probably for the better since it makes working through problems and communicating clearer and easier.

The Mechanics of the Minimum Wage [Video]

by Alex Merced

Often times when you try to create protections or regulations of the market, the result is to create an undue burden on those least able to bear them. The result is those at the very bottom can seem stuck there, and those who are somewhat to very well off find themselves relieved of a lot of competition, allowing them to take a bigger participation in the ever changing economic pie. The minimum wage is one of the policies that have these results. Although due to the amount of labor that may already be working at bottom of the income ladder can be limited, the result of this policy for good or worse can be hard to truly measured or seen. Yet, understanding the impacts of market intervention on economic disparities and in turn economic tolerance needs to be more part of the economic discussion.

Why Economics, Choice and Tolerance are Inseperable

by Alex Merced

Often times people define issues into two categories, economic and social, as if there is no influence these have on each other. I contend a world with a more robust competitive economy would also be a world of greater tolerance. Many social and caste divides are born out of economic scarcity, out of a demand for a reason to justify taking more of the economic pie for “us” and leave less for “them” because the sentiment is that there isn’t enough for everyone. If anything history, I think, shows pretty clearly that wealth is more abundant when more of us cooperate and compete with each other to provide value (aka the FREE market) instead of competing over limiting market access to others (protectionism/regulated markets/no markets). Although these divisions over time get ingrained in the culture of these arbitrary groups and can lead to generations of resentment, hostility, and sometimes violence which is why a focus on robust free market policy is an imperative for wealth building but also social cohesion (if you are prosperous you’re less likely to resent other people for being prosperous, or try to prevent them from being so).

So, essentially, economic performance will make people more tolerant of each other, which in turn improves economic scale. So, essentially, any discussion of promoting tolerance can’t be separated from people’s quality of life (which is partly determined by the wealth, and in other part determined by internal factors which often come from peoples ability to pursue their interests and attain property). As people’s quality of life drops, whether from losing their economic (wealth) or autonomous (choice) means to pursue their ends (goals), they begin to look for scapegoats to blame.

Bottom line: A libertarian world view which focuses on empowering peoples economic opportunities and individual choices, is the formula to having a more tolerant socially cohesive society.

The Law, Legislation, and Tolerance

by Alex Merced

As mentioned by George Mason University economist Don Boudreux, F.A. Hayek had important insights into society’s institutional behavior in his distinction between the Law and Legislation.The distinction being that legislation are rules formally instituted by a legislative body (think government) and laws are the rules we universally and informally follow.

Driving home the distinction:

– It is legislation that prohibits the sale and use of marijuana in the United States, but it’s not necessarily a piece of legislation people follow strictly because this has weakened over time as social law.

– While there is no explicit rule to not cut people in line, we all know not to and generally don’t. This would be an example of a social law.

Often times legislation is guided by law, because legislation that runs contrary to the societal laws of the time will often be difficult to pass, much less enforce, without political consequences. From a libertarian standpoint, this creates several implications that libertarians should concern themselves with.

1. Societal Law can be a barrier to Coercive Legislation: While politics is not really an ideological sphere of society (politicians use ideology to gain power successfully more so  than ideologues use politicians to shape society successfully). So if libertarians are concerned with the size of government and equality under the law (meaning legislation that does create arbitrary societal divides), then the societal law (culture, norms, ethics etc) should hold these things in high regards so that legislation that runs counter to these goals finds it difficult to exist or be enforced. Luckily, the United States has a deep historical culture of inclusiveness (melting pot), skepticism of central rule (revolutionary war, Nixon Scandals, NSA), and celebration of individual achievement (when we think of Steve Jobs, Bill Gates, and other entrepreneurs, we think of their individual achievement first, and barely, if ever, think of any indirect or direct government involvement in their enterprises). So the United States societal law has always been primed to keep certain lines difficult to cross more so than other nations (not that they haven’t been crossed, or that these barriers haven’t weakened at all).

2. Not participating in shaping societal law can make the fight against coercive legislation an uphill battle: If we don’t, through cultural transmission channels like family (how many laws/manners did you learn from your parents), media (how much did you learn from certain TV shows and movies), and the education system, attempt to make or keep things like property rights, non-aggression, and appreciation/tolerance of the individual part of societal law we will find legislation drifting further into larger violations of these values that libertarians hold dear.

So, distinguishing the external forces that shape our behavior and choices into law and legislation can be a very useful tool in solving the types of problems and issues us libertarians concern ourselves with. Another useful taxonomy is that of Institutions and Organizations from economist Douglass C. North. In this breakdown, institutions are the formal and informal human constructs that we allow to limit our behavior (legislation, laws, etc.) and Organizations are the hierarchies of how individuals organize to accomplish a shared goal. So if we look at a university, the distinction between the organization (the president, faculty, and their powers) and the institution (the formal school rules and informal traditions that have developed) can be broken down to help understand the social dynamics.

Libertarians making an effort to use these types of insights to improve and strengthen our understanding of society within the framework of Libertarian philosophy present a great opportunity to push forward the importance and argument for our cause.