Re: more on the georgist claptrap

"In modern neoclassical economics, rent is
something paid to a FACTOR (e.g., land, labor,
capital) in excess of its next best use. Profit is a
return to a FIRM above and beyond all of its costs
of production. Georgists may not use the term in
exactly the same way as modern economists do, but
modern economists don't consider rent to be
synonymous with profit either."
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But you've just given a definition where they are
synonymous. Please parse the words. In
economics, "the next best use" is the "opportunity
cost" of production, the income the firm is
foregoing by investing in its present use rather than
its "next best use." The difference if there is any
between the first and second sentences is merely the
difference in perspective between the person or firm
making the payment, and the person or firm
receiving the payment.

Here is the definition from the Encarta online
dictionary that makes the matter very clear. Notice
that it defines economic rent as "payment producing
a profit."
------------------------------

economic rent

ec·o·nom·ic rent (plural ec·o·nom·ic rents)

noun
Definition:

Payment producing profit: the payment received for
a factor of production such as labor or machinery in
excess of the amount needed to produce a good.

http://encarta.msn.com/dictionary_1861689625/economic_rent.html
-


ruetheday@xxxxxxxxxx wrote:
w_b_ryan@xxxxxxxxx wrote:
"No, it was always 'economic rent'. Didn't you read
the subject line as you changed it?"
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As modern economists use the term, there is no
difference between "rent" and "economic rent."
The term is synonymous with "profit." The
prospect for profit is the inducement to invest.

That's an outright falsehood. In modern neoclassical economics, rent
is something paid to a FACTOR (e.g., land, labor, capital) in excess of
its next best use. Profit is a return to a FIRM above and beyond all
of its costs of production. Georgists may not use the term in exactly
the same way as modern economists do, but modern economists don't
consider rent to be synonymous with profit either.

.

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