Re: Economic Rent As Sum of Externalities
- From: royls@xxxxxxxxx
- Date: Fri, 01 Jun 2007 06:30:00 GMT
On Fri, 01 Jun 2007 03:41:39 GMT, jmh <jmhall@xxxxxxxxxxxxxxxx> wrote:
On Thu, 31 May 2007 20:11:52 GMT, royls@xxxxxxxxx in sci.econ
confessed to the world saying:
On Thu, 31 May 2007 17:37:11 GMT, jmh <jmhall@xxxxxxxxxxxxxxxx> wrote:
On Wed, 30 May 2007 20:40:30 -0700, The Trucker in sci.econ
confessed to the world saying:
On Thu, 31 May 2007 00:02:00 +0000, jmh wrote:
On Wed, 30 May 2007 03:55:36 GMT, royls@xxxxxxxxx in sci.econ
confessed to the world saying:
On 29 May 2007 09:47:29 -0700, "James A. Bowery" <jabowery@xxxxxxxxx>
wrote:
On May 29, 9:18 am, r...@xxxxxxxxx wrote:
Could you explain why you want to prevent people from thinking about
economic rent?
I'm on your side.
Well, I don't see how linking rent with externalities helps "my" side.
Neoclassical economists have tried to prevent people from thinking
about economic rent by redefining it according to the _amount_ of
return obtained rather than the _source_ of that return. Attributing
rent to externalities rather than privileges has a similar effect:
directing attention away from the fact that rent is the share of
production that is obtained in return for not blocking producers'
access to production opportunities that would otherwise have been
accessible.
Odd that Smith doesn't seem to define rent that way. I guess
he's not a classical economist.
Odd that you have never read the WON yet claim to know what Smith defines.
So here ya go:
B.I, Ch.6, Of the Component Parts of the Price of Commodities in paragraph I.6.8
That's not Smith's *definition* of rent.
Right, because Smith had no definition of rent other than the assumed
classical one: the share of production paid for use of land (a
"production opportunity that would otherwise have been accessible,"
for the brain-dead among you).
Smith's definition of
rent *is* the neoclassical definition: "Whatever part of the the
produce, or, what is the same thing, whatever part of it's price,
is over and above [the production costs and normal profit], [the
landlord] naturaly endevours to to researve to himslef as the rent
of his land..." (p144 in my Modern Library/Random House edition and
p 306 of the 1825 T & J Allman printing, London)
That's not Smith's DEFINITION of rent, either, nor is it the
neoclassical definition. You are just lying. That is the normal,
routine and expected practice of all apologists for rentier privilege,
greed and parasitism, without exception.
Odd that the last sentance of the first paragraph of Chapter XI
is "This portion [the difference in output and production cost +
normal profit and then allowing for some variance in reality],
however, may still be considered as the natural rent of of land,
or the rent for which it is naturally meant that land should for
the most part be let."
MIT Dictionary of economic: A payment to a factor in excess of
what is necessary tokeep it to its present employment.
Commonality = 0.
In both cases the definitions refer to a portion of the price
that exceeds the some normal base (be it the farmer's required
incomve rfom working the land or some reservation price) Different
words but same concept.
It is most certainly not the same concept. Don't be absurd.
The difference between Smith's and neoclassical concept of
rent in not in the concept or definition but in who is involved.
Garbage.
Smith, tight to the classical terminology, has to have a landlord
and a farmer. The neoclassical understanding allows this
concept to apply when only considering a single factor.
It's a totally different concept.
Smith. in laying out his concept of Rent notes that not all Land
will earn rents -- that will be determined by the demand for the
product requiring the use of the land.
Can you provide a quote where Smith says rent is determined by demand?
Look at paragraphs 6 of Chapter XI.
"Such parts only of the produce of land can commonly be brought
to market of which the ordinary price is sufficient to replace
stock which must be employed to bring them thither, together
with it's ordinary profits. If the ordinary price is more than
this, surplus part will naturally go to the rent of the land.
If it is not more, though the commodity may be brought to market,
it can afford no rent to the landlord. Whether the price is,
or is not more, edepends on demand."
IOW it is not demand at all, but the surplus of price over the costs
of labor and capital.
For Smith, rent was a result of price, not a cause of price, and
that is what distinquished it from the other two factor payments.
Right. But price is not demand, although it does depend on demand.
You can also just read Part 2 of the chapter, sine that is where
Smith talks about the production activities where land may or may
not earn rent.
I would assum this is perfectly fine with your position.
He's not saying anything I'd object to, it's just that his analysis is
restricted to the rent of land, and does not extend to other rent
collection privileges.
He also notes that technology will reduce these rents by introducing
competitive presures on landlord.
Yeah, we can sure see how technology has reduced rents since Smith's
day!
ROTFL!!
Tell me, jmh: do you ever actually _think_ about anything you write
before posting it?
Yes. Do you always resort to ad hominans when other don't see the
world as you do and refuse to allow you to do their thinking for
them?
Yes, well, some people obviously need all the help they can get in the
thinking department...
What you're doing is taking a portion of what Smith wrote and
ignoring other aspects of what he wrote.
No, that is what _you_ are doing.
More to the point of this discussion, Smith's definition, other
than labeling the return to Land as rent,
That is in fact the only definition of rent Smith uses. The rest is
explanation of what it implies.
So you're conceeding that he doesn't define rent as:
"...return for not blocking producers' access to production
opportunities that would otherwise have been accessible" and
that you just made the claim up because that's how you see
the world.
?? "Conceding"? I never said Smith defined rent that way. He used
the classical definition, which mine certainly is not.
Thanks for clearing that up Roy and showing us just how
myopic you are.
Where did you get the idea that I was claiming Smith as my authority
on the definition of rent?
defines rent exactly
like the neoclassical defition which then extented that to other
areas.
That is of course a flat-out lie. Nowhere does Smith mention anything
remotely akin to "return in excess of opportunity cost."
I just did a quick search of this post and you're the only
person making that claim. Please be careful near any open flames.
?? That is the neoclassical definition, idiot.
That extention is not some conspiracy of the landlords any more
than neoclassical economics is a capialist conspiracy to
undo marxism or socialism.
Right. It was specifically targeted at LVT, as Mason Gaffney proved
in "The Corruption of Economics."
As soon as the land of any country has all become private property, the
landlords, like all other men, love to reap where they never sowed, and
demand a rent even for its natural produce. The wood of the forest, the
grass of the field, and all the natural fruits of the earth, which, when
land was in common, cost the labourer only the trouble of gathering them,
come, even to him, to have an additional price fixed upon them. He must
then pay for the licence to gather them; and must give up to the landlord
a portion of what his labour either collects or produces. This portion,
or, what comes to the same thing, the price of this portion, constitutes
the rent of land, and in the price of the greater part of commodities
makes a third component part.------------------------------------------
Now it is absolutely true that this is not "Ricardian Rent" which seeks to
explain the difference in rent from one section of land to another.
Yet if you actually read the section where he's defining rent
Which section would that be?
You might look for some introductory part of a chapter that deals with
land rent -- say, Chapter XI, "On the Rent of Land" pay a little attention
to the text between the Chapter heading and Part I of the chapter.
I know, that sounds like crazy talk but go with for a little.
IOW, you were bloviating. Thought so.
We see that Smith says what is said above: "that rent is the share of
production that is obtained in blocking producers'access to production
opportunities that would otherwise have been accessible."
No. Smith's definition of rent is that portion of social income
going to landowners.
Right. Which refutes your lie, above, that he used the neoclassical
definition.
His definition of rent is the same.
That is a flat-out lie.
His analysis and analytic framework
differs and so, per the following, he failed to apply the definition
consistently from an economic perspective.
Garbage. He did not use the neoclassical definition AT ALL.
Smith used that definition of rent because it was universally accepted
at the time. There was no other.
In this it's no different than leasing the factory except that
classical economics included the concept of 3 classes of production
input. Each of these inputs got different lables for the return they
earned.
The difference, as Smith clearly understood and as you have decided
not to understand, is that the land was already there, with no help
from the landowner. The factory was _not_ already there with no help
from the capitalist.
Please show me where I say the land was not there?
Please try to keep the strawmen down to a dull roar.
You completely miss the point -- the ability to collect any rent
derives from ownership.
You obviously do not know what distinguishes rent from interest.
It doesn't matter if the item is produced
or not. That is a different aspect of the discussion.
The difference between producing something and controlling what you
did not produce is absolutely central to understanding rent.
And though Smith may not repeat this every time he uses the word "rent" in
the WON, the facts are clearly evident and it is clear that Smith knew the
facts.
The bottom line is that Ricardian land rent is not the only land rent and,
in fact the usability for a section of the every worst land for growing
corn will have taken advantage of the difference between the profits of
wood and the profits of corn. And that difference even on the worst
corn land will line the pockets of the rentier.
And the _cost_ of everything is STILL _LABOR_.
And still remains a vacuoust statement for any political
economic analysis. The landlord labors as well in both setting
and collecting the rent.
That is an outrageous lie. The landlord does _not_ set the rent,
which is determined solely by the economic advantage obtained by using
his land relative to marginal land. He merely accepts the high bid.
And you could with equal "logic" claim that the bandits in the passes
"labor" to collect tolls from the merchant caravans as they travel
through.
Your bandit analogy works just fine too. Trotting out "Labor" doesn't
accomplish anything. That's why I've been asking about how Labor is to
be measured if that is going to be called the real/true/only economic
cost.
That's the Trucker's idea, not mine, and I'll let him speak to it.
Accepting the high bit is setting the rent
No, it is not, any more than an auctioneer sets the price of what he
sells.
he also has to think
about things like term of leasse and form expectation about what's
going to happen in the world tomorrow that might make his position
change -- you should be familiar with that case, do I lease today or
tomorrow to maximize total return?
A thief has similar issues to ponder. That doesn't make his
cogitations _productive_.
The only thing here is that you an Trucker want to impose some
arbitraty boundry on when some human action is labor and when it's
not
There is nothing arbitrary about it. Labor is simply productive human
effort.
-- even when the action is the same.
?? When is the landowner's action the same as the laborer's?
On top of that then you
don't even offer any basis for how you're going to compare
the approved labor of one to anothe within the society.
No idea what you are talking about. Effort is only labor if it is
_productive_.
How does one engage in political economic analysis without any
standards at all?
Badly, to judge by your example.
-- Roy L
.
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