("we should be self sufficient," "we should settle until the natural resources are depleted and then move," "we need to utilize trade and an open economy," etc.), and as these are based on mathematical models, is it realistic to say that in the long-run, there would be one "best" economy that will eventually dominate the entire planet?
And given that this is true, and given that expansion into space isn't a possibility, does that mean that eventually we will approach a finite limit on Earth where we will no longer be able to produce or expand any further?
An interesting point that someone made was that the potential growth of our planet is infinite because new ideas and innovations does not have a diminishing marginal utility.
I just thought this was an interesting topic, and wanted to see if anyone here would have an opinion or some paper about it? I couldn't really find anything online.
Later on, someone else mentioned that "new ideas and innovations does not have a diminishing marginal utility" would be a great senior quote.
Clearly this last part needs no further discussion..
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You guys have stumbled upon a debate older than Adam Smith's Wealth of Nations. (I think)
ReplyDeleteThomas Malthus wrote a piece called an Essay on the Principle of population. He postulated we'd eventually, through our vice (that's right, sex) out strip nature's subsistence, be miserable, procreate less and ultimately hover around an equilibrium.
This was a major influence on Darwin's origin of species.
Whoever commented that new ideas and innovation do not have a diminishing marginal utility (long run presumed), was very perceptive. It is precisely this point, championed by a female economist from either Holland or Denmark who's name I can't remember, that has won out in the most recent go around on this debate. Somebody can get a gold star for figuring out who that is. (Countries may not be right either haha)
In addition, I'm sure we've all studied the solow growth models, etc. The early models that formed the start of growth theory all theoretically broke down and society blew up. (No wonder we economics is called the dismal science) These growth models, and their cousin Malthus, never accounted for innovation.
How does this play into the baby problem in Germany italy, etc.? I dont' know. I do know that Malthus had it wrong. Whatev's. It's 11:30, and I just got out of work, so sorry for the totally baseless facts, and ramble, this is just one of my favs.