By Jim Stanford
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Additional resources for Economics for Everyone: A Short Guide to the Economics of Capitalism
Unfortunately, the dominant stream in modern economics (NEOCLASSICAL ECONOMICS, which we’ll discuss more in Chapter 4) makes it more complicated than it needs to be. Instead of addressing broad questions of production and distribution, neoclassical economics focuses narrowly on markets and exchange. ” Stanford 01 intro 23 9/4/08 18:04:07 24 Economics for Everyone Embedded in this definition is a very peculiar (and rather dismal) interpretation of economic life. Scarcity is a normal condition. Humans are “endowed” with arbitrary amounts of useful resources.
Yes, services are increasingly important. But many services are produced in large-scale, factory-like workplaces. Think of a longdistance call centre, with hundreds of workers sitting in small cubicles, whose work is electronically paced and constantly monitored. And the services sector of the economy is still dominated (just like goodsproducing industries) by profit-seeking private companies, many of them very large – and very profitable. Yes, information is more important and faster-flowing than ever.
New banking regulations were aimed at preventing financial chaos. Government income-support and makework projects tried to put people back to work. To some extent, these projects were influenced by the economic ideas of John Maynard Keynes (more on this in the next chapter). The greatest (and deadliest) make-work project was World War II. The war spurred massive Stanford 01 intro 45 9/4/08 18:04:09 46 Economics for Everyone military spending which suddenly kicked all the major economies back into high gear, and eliminated unemployment.