Re: Economic Rent As Sum of Externalities
- From: royls@xxxxxxxxx
- Date: Mon, 04 Jun 2007 23:47:00 GMT
On Sun, 03 Jun 2007 21:58:52 GMT, jmh <jmhall@xxxxxxxxxxxxxxxx> wrote:
On Fri, 01 Jun 2007 06:30:00 GMT, royls@xxxxxxxxx in sci.econ
confessed to the world saying:
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:
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 to keep it to its present employment.
Commonality = 0.
? For someone who frequently accuses others of understanding
what's written you seem to be missing a lot here.
No, I am identifying the fact that you seek to deny.
If cost +
normal profit in the above is not the reservation price
what is it?
Cost + normal profit.
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.
above -- same concept, applied in a more narrow area.
Flat false.
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.
LOL -- you've got to be joking Roy -- the text is just above.
Yes, and it proves that you are lying and that I am correct.
If the output price is not > than the cost + normal profit
(reservation rate) then rent = 0. Smith says the price
is set by demand and rent is the residual difference between
the two. Transitivity holds here.
No, because cost and "normal" profit are not fixed. Rent is a
_residual_, and is therefore _not_ determined by demand but by demand,
supply, technology, capital accumulation, quality and availabiilty of
labor, etc. You are just flat wrong.
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.
Really?
Yes.
So what about all his comments about mechantilist and
labor unions?
He does not call their returns rent, although obviously he is aware
that they are not rightly called wages or interest.
Clearly the issue to Smith was widespread but he
simply reserved the lable "rent" when talking about income going
to Land owners.
Right. Which proves you are a liar.
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...
No, you've seem to have stopped thinking and work from the premise
that you *are* the authority on any subject you comment on here.
I'm not an authority on anything but how to identify and expose
errors.
You've lost the ability to recognize anyone else's thoughts that
conflict with yours.
No, I recognize them as erroneous, and show why.
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.
True, you implied that the neoclassical have redefined it,
No, I stated the fact that they did.
implying they wanted to change the understanding of the
concept from that of the classical economists. Smith's
treatment of rent shows they simply applied the same concept
more widely by the same name.
Nope. Refuted above.
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.
?? Not according to MIT for one source.
Oh, just Google it, for chrissakes.
You're opportunity cost based rent redeiniton *might* be
equivalent if the assumptions about equalibrium hold but
that's a purely theoretical treatement is we also make so
key psychological assumptions as well.
The key psychological assumption is that those who repeatedly deny
perfectly evident and indisputable facts of objective reality are
trying to deceive someone.
This definition
that you're offering is even closer to Smith's as well.
(what is "normal profits" if not market rate of retrun
in some theoretical equalibrium?)
"Normal" profits are _themselves_ determined in part by the
availabiilty of rent collection privileges.
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.
Roy clearly doesn't watch TV or recognize humor. Sorry you missed
the reference.
No, I don't watch TV, but I do recognize humor, and deliberate deceit
is not it. In that section Smith says clearly and unequivocally that
rent is the price paid for use of land, period, just as I said, and as
you have been denying.
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.
All bow to Lord Roy.
Thank you for admitting that you lied.
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.
True, the neoclassical definition was simply an extention of the
concept to all inputs rather than just Land, as should be.
Wrong. The neoclassical redefinition of rent substituted the concept
of "excess return" for the concept of "return to landowning." This
substitution was needed in order to separate the concept of rent from
the inherent parasitism of the landowner, allowing the neoclassical
economist to claim that workers receive rent but landowners do not, by
invoking the efficient market premise.
Why does economic need 3 terms for "factor payment"?
Because the three types of factor payments are paid for three
fundamentally different things, and economics cannot be understood
without separating those three types of payment any more than physics
can be understood without separating matter into solids, liquids and
gases.
That the concept of
rent is most easily understood when presented using the old fuedal
social relationships doesn't mean we should chain the name to Land.
I agree it is more informative to use the word, "rent" to mean any
return obtained by controlling others' access to opportunities that
would otherwise have been accessible, but that does not excuse lying
about what Smith and others wrote about rent.
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.
I have zero control over what you write Roy.
Wrong. You can stop me from identifying your lies by not lying.
Starting 11 up Roy writes: "Smith clearly understood and as you have decided
not to understand, is that the land was already there,"
So who is making strawmen and who is in denial?
<yawn> Please look up about 25 lines, read what you wrote there, and
then explain why you stated that leasing capital, which had to be
produced by labor, is no different from leasing land, which was
already there with no help from anyone.
You completely miss the point -- the ability to collect any rent
derives from ownership.
You obviously do not know what distinguishes rent from interest.
??? Who is talking about interest? Please try to stay on topic
and not muddle the subject up with unrelated comments.
Thank you for confirming that you refuse to know the difference
between the payment for capital, which would not otherwise have been
available, and the payment for land, which would.
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.
That is incorrect
No, it is absolutely correct.
unless of course your whole understanding
of the subject is that "rent" is what paid to a landlord
(the vulgar understanding of rent).
No, that is of course a non sequitur and a strawman.
Economics is not required
for that subject -- only the question of can man own nature
privately.
No. Whether man can own nature privately is irrelevant to the fact
that the return to such ownership is not earned by making any
contribution to production.
-- Roy L
.
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