Quote: (02-12-2013 02:51 AM)All or Nothing Wrote:
Quote: (02-12-2013 01:53 AM)T and A Man Wrote:
Erhh, that's not a good interpretation of Adam Smith, and reall isn't important.
Actually, it's a direct interpretation. The greater the labor force, the greater the wealth. Look at China, a prime example of a large labor force producing massive amounts of wealth.
No, that has to do with enhanced productivity. if it stayed the backward Agrarian nation of the 1970's, it would still be dirt poor.
The parallel is a nation of 100 people earning $100,000 each, therefore aggregate income is $10,000,000, or a nation of 200,000,000 earning $1 each.
The latter scenario is a richer nation, but I wouldn't want to be part of that nation.
China hasn't had a population explosion, it has enhanced its productivity.
And Adam's Smith number one principal was increased wealth came about through ehancing productivity.
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It is also highly important. You cannot have a large group of people in retirement while the workforce is small. No country can sustain a relatively large group of people who have passed the working age, it leads to rapid economic downfall. Again, I point to Japan as a prime example of this.
That's not a feature of increasing your workforce, it's a feature of increased life expectancy. If you don't increase your population levels exponentially for perpetuity, you will eventually run into this problem.
The problem is the retirement age hasn't been recalibrated to compensate for increased life expectency.
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Quote: (02-12-2013 01:53 AM)T and A Man Wrote:
A nation's wealth is the aggregate of its product. Now sure your labuor force diminishing usually means diminished aggregate product, however it can be compensated by improvements in productivity, and that means investment in technology that enhances inputs, (and that means keynesian economics)
But even if the aggregate diminishes, it doesn't matter because you've got less people to share it around with.
It's only meaningful if you want to engage in a dickwaving contest about comparing GDP sizes. Otherwise India is a better country than Normay, because of a bigger GDP.
How are you going to make improvements in productivity? That is the question. It costs money to improve productivity.
No, more inputs. Raise the retirement age, means more labour input, means more product to market. Whetehr those old people are working or not, they are still going to demand product. if they work, they are actually brining some of the product they demand to market.
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Will those costs that are onset initially be offset at a rapid pace, or will it never generate profit? Is there technology that is even available to increase productivity?
A productivty enhancer has never failed to materialise in history. Your conjecture is an stock standard malthusian claim.
Technology has rarely reached the level of productivity enhancement as it has in the world right now.
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Even more so, which areas of workforce would deplete and be in need of increased productivity? A lot of questions, little to no answers.
The workforce doesn't need to deplete. Pruning the least productive may enhance productivity at the margins, not the aggregate.
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If the aggregate diminishes, especially if it is largely occurring in the working force due to decreasing birthrates, then the wealth of the nation produced takes a rapid drop in addition to the population drop.
No, if the aggregate diminishes, then those that aren't producing have to start producing to reverse the trend. The more people work, regardless of age, the more product is created.
Kicking up stumps at receiving someone elses output at 65 is not an immutable law.
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In fact, the wealth of the nation would decrease faster than the population due to the fact that the working force would be decreasing in size faster relative to the rest of the population decrease.
No, the decrease is faster due to the (presumed) declining maginal productivity due to feebleness and infirmity. technology can compensate many of these areas.
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GDP size does not matter as much as economic stability along with the average person's well being, which is what I am discussing here.
yes, you are try to assimilate GDP per capita into the argument, which is what I've infered.
Aggregate output is the numerator.
If people die, the per capita bit.. the denominator also shrinks. if they shrink at equal levels, then you don't need to do anything.. GDP per capita stays constant.
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A shrinking national economy is a lie sold to useful idiots. Workers quality of life diminshed for the preserve of the rent seeker.
Well, it seems that the idiots understand basic reality while you cannot see things that are clearly happening in the world.
When it comes to macro economics, i see things clear than a vast majority in the world, andI see it clearer than you.
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will say this again, look at Japan. Japan is facing severe economic crisis due to the fact that its workforce is too small to sustain the entire relative population (aka too many old people).
And as if on queue about clear vision..... too many old people is not a barrier to production, other than a social construct making it that way.
Raise the retirement age, and your workforce increases.
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The reason why countries like the U.S. and Germany allow so many immigrants is because it sustains the workforce and neutralizes many of the problems that would occur in a country where its workforce is rapidly decreasing.
No, the reason they allow it, and Australia, my country, is the OECD country with the highest percentage immigration intake at this point in time, is to allow bottom feeding rent-seekers more customers in shopping centres, houses and our very own education bubble more customers.
These are all low tech industries to serve and generally rampant consumerist in nature, with only the latter has potentially high value outcomes.
As I said, useful idiots espouse this. if you think your nation's qyuality of life improves by cramming housing and public schools, as well as 3% more customer trawling your shopping malls, then I think I prove my point.