Masood Mortazavi's Weblog

Thursday March 29, 2007

[ Economics ] Inducement and Growth

Douglass North, a Nobel Prize winning economist, writes:

A stationary state will result when there is no inducement for individuals in a society to undertake those activities that lead to economic growth. Granted that individuals in the society may choose to ignore such positive incentives, and that in all societies some are content with their present situation; yet casual empiricism suggests that most people prefer more goods to fewer goods and act accordingly. Economic growth requires only that some part of the populace be acquisitive.

It seems to me that acquisitiveness does not embody the only sufficient condition for economic growth. Other models of growth involve social growth for social purposes which create a more living environment, leading to greater productivity and growth through the modified activities of members of a society. Here, no acquisition may have happened. Only changes in the environment of activity has transformed the quality and quantity of it.

2007-03-29 08:11:02.0 -- Comments [3] ; Permalink ; Trackback.
economics growth

Comments:

A stationary state will result when there is no inducement for individuals in a society to undertake those activities that lead to economic growth. The high rate of taxation in the UK means that the UK has reached that point already.

Posted by Gary Ward on March 29, 2007 at 08:30 AM PDT #

Taxation for productive social purposes, such as better transportation and communications systems, culture, art, education, living spaces, health, public spaces, etc., etc., would be justifiable and good. Spent on aggressive wars, they represent a quick "fix" for an economy in trouble. Quick "fixes" are usually accompanies with nasty withdrawal effects!

Posted by M. Mortazavi on March 29, 2007 at 03:20 PM PDT #

I could not agree more. Taxes in the UK are not spent on health, education or infra-structure, which is why many people object to paying them, particularly to finance an illegal and unjustifiable war. Ever since Margaret Thatcher invaded the Falkland Islands and thus won the next election, every British Prime Minister has tried the same trick for the same purpose.

Posted by 192.18.4.200 on April 02, 2007 at 06:43 AM PDT #