From [Marc Abrams (2005.10.19.0612)
A breath of fresh air, and for you Bjorn I respond.
In a message dated 10/19/2005 3:13:40 A.M. Eastern Daylight Time, bsimonsen@C2I.NET writes:
[From Bjorn Simonsen (2005.10.19.09:15 EuST)]
From Rick Marken (2005.10.18.0900)
I would not mix me up in your discussion about Interesting law and Wealth Distribution. You have brought about too many assertions. It would better if the themes were limited.
Yes, I agree. But I think Rick had a difficult time trying to ‘win’ an argument instead of trying to learn something.
By this I mean, instead of investigating a single point and coming to some understanding of why he and others (meaning me in this case) understood things to be one way or the other he continued to try some fancy foot work and ‘win’ an argument. Rick has no respect for my ideas or for me and clearly showed it, regardless of what he used later as a slimy excuse to attack me.
I was open and willing to change my mind in the face of evidence that showed I was not thinking clearly but Rick could not produce that evidence. Rick was not open to be influenced. He was only interested in ‘winning’ an argument.
This ‘teaching’ style as Dag brought up is disastrous, and has been for as long as Rick and Bill have practiced it. Rick unfortunately is blind to the consequences of his actions and more importantly is unwilling to look at it when it is pointed out by others who can see it. Rick has no inner courage to deal with the notion that he can and often is wrong, like we all are.
But I mix me inn nevertheless.
Glad you did
You, Marc said: Capitalism is not a zero sum game. Marc Abrams (2005.10.17.1543) –
Earlier you brought in a definition for Economics. (The one everybody learn the first day they study Economics). From Marc Abrams (2005.09.26.0820)]. * Economics is about how we as individuals allocate scarce resources that have alternative uses*.
Capitalism is one way to allocate scarce recourses.
I think therefore as Rick that all economics are a zero sum game.
Then at the end you say;
From Rick Marken (2005.10.18.1340)
If the economy is a zero sum game, then an increase in wealth
for some “players” necessarily means a decrease for others.
Yes. But in practice I don’t think the economy must be a zero sum game. What do you say?
Which one is it Bjorn?
I’m not sure I follow your logic. What does alternative uses for scarce resources have to do with a zero-sum game?
First, a zero-sum game is about ‘winning’ and ‘losing’.
In an economy, any economy, the resources will flow to the demand and be used where the demand is highest.
For instance, lets take a national economy. Who decides how much milk production should be used for the productions of cheese, ice cream, and other dairy products?
In a centrally planned one (socialism) the state decides how much of a resource, in this case milk, to allocate to each product. In a capitalistic one, it is supposed to be the consumer by their purchase histories. In our economies it is a bit of both.
Now I suppose you could view it, and make the claim that what is ‘gained’ by ice cream is ‘lost’ by cheese, because you can’t use the same milk to make both. But to call that a zero-sum game is a bit of a stretch in my book, but if that is how you see it , fine.
But Rick and I were not talking about a limited resource with alternative uses. What it came down to was Rick’s assertion that what one person makes in income he necessarily takes away from someone else…
If this were so, as you yourself pointed out, among other things, people’s income’s are not the same from year to year number one, and I pointed out an ongoing University of Michigan study that has been going on since 1968; http://psidonline.isr.umich.edu/
Among other things, this study showed that in a 16 year period in the US, the vast majority of people who were in the lowest 20% bracket moved to the top 20%.
This clearly refutes Rick’s contention that the “rich get richer and the poor get poorer”.
Of course in certain cases this does happen, just as the rich get poorer and as the study showed the poor get richer. In either case it shows that one does not affect the other.
As I mentioned in another post, all this has nothing to do with wealth accumulation, where it could, and I did say, could be, a zero-sum game, and I think here is where a lot of confusion sets in.
Since capitalism provides the concept of ‘profits’, people equate profits to wealth, but they are not the same thing, as I tried pointing out to Rick with examples I don’t have to repeat here.
I think it is helpful to think of the analogy of ‘profits’ as the derivative and wealth as the integral.
Wealth can be accumulated without profits. Simply take it from someone else. That is a zero-sum game. But our economy is not based on people taking things from one person without their consent and giving it to another ‘legally’ unless you are the government. 
Then, not only can you redistribute the wealth, you can also kill other people on its directives. But hey, that is one of he reasons we have governments in the first place. They help us do things collectively we would not think of doing individually. It’s wonderful when you can toss personal responsibility aside and hand it over to someone or thing else. At least for some. Ok, I’m of my soapbox. 
From Rick Marken (2005.10.18.0900)
At any instant an economy is a finite size (the size of GDP, say) and it is being
consumed by a population of finite size (N). If some subset of the population is
able to control an increasing proportion of GDP then there will be less and less
of that GDP available to the remainder of the population.
I have problems when I try to understand your last passage. At the instant the economy has a finite size (the size of GDP, say) time for the transactions is passed. No subset of the population is able to control an increasing proportion of that GDP. In this part you will find that a subset of the population represent a lesser part then the subset is part of population.
Proportioning out the GDP to individuals is akin to any other statistical method that purports to represent an individual with some averaged composite and is akin to making psychological attributions about an individual with a population study. Which means it’s just about worthless.
As the author of a psychological research methods text I guess old habits die hard for Rick.
When you say the poorer become more poor and the richer become more rich, the “poor� concept doesn’t represent a group of people. The “poor� concept is a theoretical concept. (Of course some people are poor their whole life, but not all. Lone mothers merry.)
The actual % of ‘permanent’ poverty stricken people, at least here in the US is very small. By permanent I mean being under the poverty line for 10 or more years.
But again we must be very careful. Income does not necessarily equate to wealth, as I showed examples of college kids, retirees, and people having bad years in business all being classified as living in ‘poverty’ when they are in fact not.
Back to the zero sum Game.
Saying: _* Economics is about how we as individuals allocate scarce resources that have alternative uses* _, indicate that Economics is a zero sum Game. But this definition may be a bad definition, because the example below indicates something else.
I think that definition was made to explain the theory about “offer and demand�. There they talk about one widget.
Do you mean ‘supply’ and demand? If not, what? I’m not trying to be cute here just cautious. I don’t like assuming
My example is from national economy, not a global economy.
If the government one year makes it easier and cheaper to start a business, more businesses starts.
You have this reversed. A government cannot make it ‘easier’ or ‘cheaper’. It can only make it more expensive and more difficult.
Government makes things ‘easier’ & cheaper by not doing anything.
Unemployment is reduced and GDP becomes greater than if the government didn’t make it easier to start a business.
Business does not need government.
Those people who were unemployed become employed.
In this example I think there was a zero sum Game before government decision and another zero sum Game after the decision.
Who were the ‘winners’ and who were the ‘losers’? Remember, you must show a ‘loser’ tied to every ‘winner’, and what was ‘won’ and ‘lost’ in each case?
Regards,
Marc
