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ndrosenTo continue with Sunday, July 30, 2017, we heard from Lindy Davies “On Fictitious Commodities and Sacred Land.” He had been to the London conference with the International Union for Land Value Taxation the previous September, and had some thins to say. The job of a good scientific theory is to describe and to predict, and using the three factor model of production makes doing these things easier (land, labor, and capital, as opposed to the two factor model, labor and capital, of most of modern economics).
He spoke about Karl Polyani (1886-1964), and his idea of the “Great Transformation” from pre-industrial to industrial society. Pre-industrial society relied on reciprocity. Industrial society just relied on market mechanisms, which would lead to a breakdown of sanctity. Labor, land, and money are what Polanski called “fictitious commodities.” They have social value, not just market value.
What is a commodity? An economic good or service that has value and can be traded.
Labor. At the top, there are specially skilled, unique laborers likes Jennifer Lawrence. Then there are professionals like doctors and lawyers, skilled laborers, and finally the unskilled laborers. Their wages determine what those above them can earn. The basic labor market is almost perfectly competitive, tending to drive down wages to subsistence. This is a market failure, as Polyani would see it. Readers of Progress and Poverty should know that this is not the natural condition; it is the result of laborers not having access to land for themselves.
To be continued
He spoke about Karl Polyani (1886-1964), and his idea of the “Great Transformation” from pre-industrial to industrial society. Pre-industrial society relied on reciprocity. Industrial society just relied on market mechanisms, which would lead to a breakdown of sanctity. Labor, land, and money are what Polanski called “fictitious commodities.” They have social value, not just market value.
What is a commodity? An economic good or service that has value and can be traded.
Labor. At the top, there are specially skilled, unique laborers likes Jennifer Lawrence. Then there are professionals like doctors and lawyers, skilled laborers, and finally the unskilled laborers. Their wages determine what those above them can earn. The basic labor market is almost perfectly competitive, tending to drive down wages to subsistence. This is a market failure, as Polyani would see it. Readers of Progress and Poverty should know that this is not the natural condition; it is the result of laborers not having access to land for themselves.
To be continued
