The Hockey Stick of Human Prosperity
In this series, Professor Don Boudreaux explores the question economists have been asking since the era of Adam Smith – what creates wealth? On a timeline of human
In this series, Professor Don Boudreaux explores the question economists have been asking since the era of Adam Smith – what creates wealth? On a timeline of human history, the recent rise in standards of living resembles a hockey stick – flatlining for all of human history and then skyrocketing in just the last few centuries. Without specialization and trade, our ancient ancestors only consumed what they could make themselves. How can specialization and trade help explain the astonishing growth of productivity and output in such a short amount of time—after millennia of famine, low life expectancy, and incurable disease?
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Mortality is one measure of human of life, but are we happier just doing "one job?" Feeling that we are helpless to provide for ourselves, does that lead to contentment, or does it make us feel like a replaceable cog in a giant machine?
We don't have to do "one job," but we're much more productive and therefore paid more if we specialize. And likewise, we don't need to be helpless. We are free to learn how "provide for ourselves" if we so choose.
Read Charles Handy's "The Elephant and the Flea: Reflections of a Reluctant Capitalist". In it he talks about a new economy that began emerging in the 80s and really began to grow in the 2000s where the majority of people make their living thru multiple means. His question to workers of corporations is along the lines of "do you want to trade freedom for security (i.e. sell your time to an organization) or give up security for freedom (i.e. freelance, entrepreneurship...)?" I'd say a balance of the two is best, esp if you are raising a family with little children.
How much of our current prosperity dependent upon the fact that we do not account for all the costs of petrochemical use? We shift the costs to future generations. If we honestly account for your Guatemalan coffee, could you afford it?
As I'm not a petrochemical engineer, I can't guess at all the costs, but in the case of carbon dioxide and the variable effects reaped from global warming, the costs could very well be paid quickly and returned as benefits to the same people who paid for the petrochemicals.
Consider natural gas extracted from North Dakota and burned in Iowa. The products of that combustion are mainly heat, of which some is wasted, water, and carbon dioxide, which in turn is taken up in the carbon cycle by Iowa corn fields.
If the United States would and could deport all "undocumented workers", what would happen to the US economy? I suspect in my geographic location it would have a strong negative result in the local industry and economy.
I hope Professor Boudreaux and the team at MRUniversity will eventually include 1.) something about the relatively new field of Behavioral Economics and 2.) an analysis of "everyday economics" through the lens of resource exploitation and environmental destruction.
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