Monday, May 04, 2009

The New Economist

Money plays a big part in most peoples lives. Yet how often do you stop to think about what makes money important? Why is money used around the world? What gives money its value? It is these questions that I try to answer in the articles labeled economics.

Most of the people I talk to think of economists as businessmen. I see them differently, the economists job is to understand how money motivates people. There exists a strong relationship between the happiness of people and peoples perception of wealth. The people who feel wealthy are happy and the people who feel poor are unhappy. So wealth isn't defined by how much money people have in the bank or how deep in debt they are, when an economists speaks about wealth their focus is on well-being, the ability of people to meet their needs of food, shelter, employment and pleasure.
The most concise definition of economics I can give is "economics is the study of how society uses its scarce resources to increase happiness".

Often capitalism and greed go hand in hand, but times are changing. I believe the current global financial turmoil is to do with removing greed from capitalism. I see a change in consumerism, with more focus on quality of life services with long term value and less interest in consumables.

What do you think will make the world a better place?

Something to think about:
Why do people still think the interaction of free individuals is a superior economic system to one directed by experts??? I mean, apart from the failure of central planning in every case in which it's been tried, why wouldn't people cling to the idea of being herded into a collective run by the experts?
Have your say.