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economics

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If the government gave a company the exclusive right to import a certain amount of a certain good, such as sugar, then the extra return was called a “quota rent.” The acquisition of rights to mine or drill produces a form of rent. So does preferential tax treatment for special interests. In a broad sense, “rent seeking” defines many of the ways by which our current political process helps the rich at the expense of everyone else, including transfers and subsidies from the government, laws that make the marketplace less competitive, laws that allow C.E.O.’s to take a disproportionate share of corporate revenue (though Dodd-Frank has made matters better by requiring a non-binding shareholder vote on compensation at least once every three years), and laws that permit corporations to make profits as they degrade the environment. Joseph Stiglitz

For all its faults, however, Piketty’s “Capital in the Twenty-First Century” is an intellectual tour de force, a triumph of economic history over the theoretical, mathematical modeling that has come to dominate the economics profession in recent years. Piketty offers a timely and well-reasoned reminder that there is nothing inevitable about the dominance of human capital over financial capital, and that there is inherent in the dynamics of capitalism a natural and destabilizing tendency toward inequality of income, wealth and opportunity. Capital in the 21st Century

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I often wonder why anybody listens to economists. Their prestige far exceeds their usefulness. They exemplify the worst kind of rear-view mirror thinking. They are exceedingly conventional and reactive, and have little real insight to deliver that people don’t already know from their knowledge of about history and human nature. There’s this pretense that somehow it’s scientific and objective, but it just isn’t. Whenever you hear some economist spouting off, ask what his politics are. That will be a clearer indication of his thinking. Economics is not science; it’s ideology. Even Keynesianism was legitimated only as an ex post facto explanation for what happened in a kind of ad hoc experimental way in the U.S. during the 1930s and 40s. It was easily supplanted by voodoo economics and Laffer curvers when it seemed unable to explain the stagflation of the 1970s. The Dismal Science

Demand and supply. I think it’s taught backwards in school. There it’s “supply and demand,” where companies come up with a whole bunch of shit and supply it. Then the companies fool people into thinking that the need the shit they’re pushing, thereby creating an artificial demand. But the streets figured it correctly: The demand comes first, and whoever has the supply will profit. 50 Cent

When the rate of return on capital exceeds the rate of growth of output and income, as it did in the nineteenth century and seems quite likely to do again in the twenty-first, capitalism automatically generates arbitrary and unsustainable inequalities that radically undermine the meritocratic values on which democratic societies are based. Thomas Piketty

The relentless pursuit of lower labor costs by large corporations, which historically paid the highest wages, has helped push pay levels down, which in turn has resulted in weak demand and short job tenures. To the extent jobs have been created since the crisis, they’ve been concentrated at the bottom of the pay spectrum Marx Foresaw Capitalism’s Dangers but Not Workers’ Response

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