today's reading

Discussion in 'Economy' started by Baruch Menachem, Sep 4, 2011.

  1. Baruch Menachem
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    Baruch Menachem '

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    I have long been a fan of Adam Smith. I have been intending to read David Ricardo for years, and today I finally opened up the book "Principles of Political Economy and Taxation. " I should have done it a long time ago.

    I have to admit I am still in the first chapter, but it is already a good one. He is dealing with the very hard issue that Adam Smith struggled with, that is Labor Theory of Value. That is, wealth is generated by work and that essentially all value arises from the work put into a product. Adam Smith got into quite a tangle about this. Marx just ran with the concept and said there is no value but labor.

    Ricardo makes the point that even in the simplest societies, like for instance the Chinook of NW Oregon there is a lot of capital involved in work. Catching fish required building canoes which is a very labor intensive process. Even harvesting berries requires large amounts of labor involved in basket weaving.

    The next issue is how do you trade labor for labor. If one spends all day catching fish, and another spends all day catching a bear, if the labor is the same but the result is 20 people can eat the bear, but only 5 can eat the fish, the fact that they required equal amounts of labor to produce the food does not mean the value of the bear and the value of the fish are equal.

    Anyway, it looks like a good book, and I am enjoying it. It is a download on Guttenberg, so I recommend a swift perusal of the contents from anyone who wants to discuss economics.
     
  2. Mr. H.
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    Mr. H. Diamond Member

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    Frankly my dear, I don't read Adam.
     

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