Monday, March 12, 2012

One Consideration on Economic Growth

Recalling my first lessons on Economics, one instructor misled me with one of his "first order" presumptions, saying that we can start out with the idea that all people are inherently lazy and build our understanding of how the world works from that base. He was wrong, yet this lesson stuck with me for years and I did not easily shake off this presumption. He was wrong, but I accepted it and even saw my laziness as more acceptable since the generalization was not denied. He was wrong, as I later found out that the least important people in any study of Economics are the lazy people. He misled me and I wasted too much time in trying to pull myself away from that presumption.

The same might have happened for people who were introduced to psychology with simplified generalizations on the theories of S. Freud. If the generalization that all human activities are centered around sexual ambitions and predilections, that introduction can really taint and even injure the efforts of students in pursuing understanding of psychology and true human nature.

My dearest hope is that I do not mislead any reader, not mislead any student of Economics. My considerations here, at this root discussion for the 11 topics of my discussions, must be firmly rooted in solid thinking. I will take my time then to develop those thoughts and ask for the readers to criticize and challenge the course of my thinking.

To understand the systems and networks and ongoing functions of an Economy, studying the driven, hard-working, visionary people can truly indicate some valuable lessons. Seeing how they interact with each other, how they feed off of each others' successes and idea can truly enlighten our understanding of how the innovations occur, how the daily routines can turn to fortune for some, how ambition really is to be marveled after.

Now to the new presumption that we watch the most energetic Economic actors, add the observation that the population keeps growing. With the growth of the population, more food is needed and better distribution systems are needed. More educational services, health services, transportation, entertainment, housing, etc. are all needed in greater abundance to serve the growing populations, for one city or locality, or one province, or one nation, or for the whole world. We see that the Economy is pressured to grow in volume, in mere size.

Those most energetic actors, each taking a unique perspective may see opportunities to hone their skills, produce greater amounts, or more desirable qualities in their products, employ greater production methods, buy at a low price and add value to sell at a higher price, each envisioning ways to benefit from the pressure to grow the overall Economy. They are each acting on a profit motives, or seeing themselves creating value, or possibly improving the situation around them (of their community or their family or of some limited facets of living for themselves and others). There is pressure for a growth in the Economy simply by the increasing population. The growth will not occur unless individuals act to improve the situation, improve ones own self, or ones family's or ones community's situation. By this greater value can be created, and we can even see a profit motive developing in those forward-looking individuals.

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