Former US Senator and Presdential nominee George McGovern famously observed that life looks different when you have to meet a payrollWhich you do not really understand until you have to meet a payroll. The business I own 40% of has a fluctuating income flow. We have had a quiet start to the term, we are probably underpricing a little so, after ( Read more... )

(This LJ [was originally called] ‘thinking out aloud”. So here is some. It is me expressing what I understand about the economics of money from my reading over the years.)

Money is a medium of exchange. Which is a fancy phrase meaning we use it to buy things. Barter is exchange without money, and is a clumsy and awkward way of trading, since ( Read more... )

The Marxian theory of value says value is created by socially necessary abstract labour time. Any particular worker working on any particularly thing may, in fact, not successfully create value. But, if something has value, that value is equal to the socially necessary abstract labour time embodied in that thing ( Read more... )

taavi sent me a paper, The Social Architecture of Capitalism, a Marxian model of a capitalist economy.

The paper does modelling the correct way - teasing out the logic of assumptions and comparing them to empirical reality. In our discussion of the paper, Prof. Rob quoted to me an English statistician: there are no true models, but some of them are ( Read more... )

If (1) we control something enough ( Read more... )

Things offered in a market have a price. In a money economy, price is expressed in terms of money. In a barter economy, price is expressed in terms of what people will swap for it. Either way, prices vary-over time, between places, sometimes between sellers in the same place.

Marxian economics differentiates between price and exchange value. ( Read more... )

I [originally called] this LJ Thinking Out Aloud because it is a way of exploring and grappling with issues. So, continuing on from this post, profit and loss can be looked at usefully from the basis of the theory of the firm. The Coasian analysis of the boundary of the firm being set by the relative transaction costs of doing things within the ( Read more... )

What is profit, really? is one of those hardy economic perennials. But any explanation of profit has to also be an explanation of loss since they are just the positive and negative forms of the same thing. Any analysis of profit that is not also an analysis of loss is analytically pointless - a simple test of whether an analysis of profit is ( Read more... )

It is now possible to make a large income being active in the economy of a virtual reality ( Read more... )

The labour theory of value says that a source (labour: in Marx’s formulation socially necessary abstract labor-time, treated as "the" source) that produces something determines its exchange value ( Read more... )