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Heroes Community > Other Side of the Monitor > Thread: Economics
Thread: Economics This thread is 34 pages long: 1 2 3 4 5 ... 10 20 ... 30 31 32 33 34 · «PREV / NEXT»
Moonlith
Moonlith


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posted May 06, 2008 10:38 AM

Quote:
I agree with mvass.

It's generally only when people can afford to care about animal rights or the environment that they do.


Native-Americans. Enough said.
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TheDeath
TheDeath


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posted May 06, 2008 01:04 PM

Quote:
These regulations put people out of jobs. And if they lose their jobs, they could easily starve.
Well, a lot of regulations make assassins lose their jobs as well, like for example punishing them (because they are 'bad'), etc.. You know, on the larger scale, 'selected' murder would surely do good to the "big bosses" -- hence it would be a huge economical gain for them.

unless of course you mean that murder & assassinations are good and should be approved, since they are 'economically efficient'.

(please make distinction between assassination (which is professionally based) and a simple psycho murder).

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mvassilev
mvassilev


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posted May 06, 2008 02:13 PM
Edited by mvassilev at 14:13, 06 May 2008.

Quote:
Native-Americans. Enough said.
For them, it's a cultural/religious thing. For them, you're not some great benevolent guy if you treat animals kindly.

TheDeath:
The difference: assassinations are murder. Murder, at its most basic level, is a violation of property rights. And property rights have to be protected. Without them, you can't really have economic growth.
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TheDeath
TheDeath


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posted May 06, 2008 02:42 PM

Quote:
The difference: assassinations are murder. Murder, at its most basic level, is a violation of property rights. And property rights have to be protected. Without them, you can't really have economic growth.
Actually you can have 'economic growth', of course not for the dead person, but for the one who killed him (or hired the assassin in question).

Rights? Property rights? These are just stuff we humans have come up with, as morals, etc.. these rights can apply, in a way, to nature as well. Of course not as in "don't kill any animal at all", but rather in a less greedy economical way. A good example would be not to place your job above the life (especially if it's a day-to-day job). In this way, assassins place their jobs above the life of their victims as well

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GenieLord
GenieLord


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posted May 06, 2008 02:44 PM

Quote:
The difference: assassinations are murder. Murder, at its most basic level, is a violation of property rights. And property rights have to be protected. Without them, you can't really have economic growth.

Murder is a violation of the right to live, which is the most basic right that every human being has. I really can't understand, Mvass, how you can call the life a property? A property can be bought again, can be found, but once your life are taken, there's nothing you can do about it.

About the nature:
I think that the destruction of the nature is not going to stop, but everyone can help a little. Recycle, use less energy, put trash in cans... Those things can really change things, if many people do them.

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violent_flower
violent_flower


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Almost there.
posted May 06, 2008 04:09 PM

Quote:
The difference: assassinations are murder. Murder, at its most basic level, is a violation of property rights. And property rights have to be protected. Without them, you can't really have economic growth.


MV: Definition of property rights.

Property means Right of Action for things that can be exchanged. Important types of property include real property (land), personal property (other physical possessions), and intellectual property (rights over artistic creations, inventions, etc.). A right of ownership is associated with property that establishes the good as being "one's own thing" in relation to other individuals or groups, assuring the owner the right to dispense with the property in a manner he or she sees fit, whether to use or not use, exclude others from using, or to transfer ownership.

Murder is not a violation of property rights, I don’t know where this train of thought was going but wow you have got my intellect down to its lowest point just from reading the jack assery in that statement.

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mvassilev
mvassilev


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posted May 06, 2008 09:06 PM

Quote:
Actually you can have 'economic growth', of course not for the dead person, but for the one who killed him (or hired the assassin in question).
Normally, economic growth helps almost everybody. With the abolition of property rights, it would only help the very strong. Ultimately, this is the difference between slavery and capitalism.

Quote:
I really can't understand, Mvass, how you can call the life a property?
Well, it's a property in a broader sense. I mean, it's an inexchangable property. You own your life, and it is wrong for someone else to take it without your permission (except in cases of the death penalty), just as is with the rest of your property. If you look at it from a certain point of view, murder is a very severe form of theft.

Quote:
I think that the destruction of the nature is not going to stop, but everyone can help a little. Recycle, use less energy, put trash in cans... Those things can really change things, if many people do them.
I agree. What I'm saying is that we shouldn't force our preferences on others.

Quote:
A right of ownership is associated with property that establishes the good as being "one's own thing" in relation to other individuals or groups, assuring the owner the right to dispense with the property in a manner he or she sees fit, whether to use or not use, exclude others from using, or to transfer ownership.
Except for tranferring ownership, a life falls under all of these. A life is "one's own thing". People should have the right to dispense with it as they see fit and how to use it.
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Moonlith
Moonlith


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If all else fails, use Fiyah!
posted May 08, 2008 01:21 AM

Quote:
Quote:
Native-Americans. Enough said.
For them, it's a cultural/religious thing. For them, you're not some great benevolent guy if you treat animals kindly.


It has got NOTHING to do with that. It has to do with a very simple and basic RESPECT for Flora and Fauna - Something that you are lacking: proven by your statement that chickens are property and THINGS.

You have a problem.
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mvassilev
mvassilev


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posted May 08, 2008 01:48 AM

You've misunderstood me. First, I am against factory chicken production. That doesn't mean that I want to enforce my preferences on those who can't afford them. Second, it is a cultural/religious thing to put respect for non-human life above your own survival.
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baklava
baklava


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posted May 08, 2008 08:34 AM

Quote:
And property rights have to be protected. Without them, you can't really have economic growth.

Germany just before World War 2?
Hitler's reign marked a huge economic growth, and yet no respect for human and property rights whatsoever.

Stalin cared for no property rights, he staged a massive famine, killed tens of millions of people etcetera, and yet he turned the USSR from a battered, revolution-destroyed country into the greatest superpower on the planet.

Nah, I agree with others, property rights haven't got anything to do with economic growth.

And Indians didn't put respect for non-human life above their own. They lived quite nicely (at least until civilized Europeans came and slaughtered them all).
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mvassilev
mvassilev


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posted May 08, 2008 01:56 PM
Edited by mvassilev at 22:31, 30 May 2008.

Quote:
Germany just before World War 2?
And we all know how well that turned out.

Of course, you can have economic growth while exterminating sectors of the population, but you'll have more growth if you aren't. It's foolishness to deny everything to a sector of the population. It harms both them and you. As for the disrespect for property rights, it might be fun to play this way for a while, and the US did until the 70s (although to a lesser extent), but then came stagflation and we decided to stop.

Plus you have to consider that if a country disrespects property rights, then businesses will avoid it like the plague. Its economy will have to run on government spending, which ranges from inefficient to criminally corrupt.

Quote:
Stalin cared for no property rights, he staged a massive famine, killed tens of millions of people etcetera, and yet he turned the USSR from a battered, revolution-destroyed country into the [ugreatest superpower on the planet.
Military strength is not necessarily an indicator of economic strength. The reason that the USSR was so strong is that the government basically said, "OK, the military is our #1 priority. Everything for it." So resources that might have been more efficiently allocated somewhere else were used on the military, harming the general population. And the Soviet system did collapse.

And for those who say that a free market makes the country's standard of living worse:
Index of Economic Indicators
Quality of life index

There appears to be a correlation.
Ireland is #3 on the first list and #1 on the second.
Switzerland is #9 on the first and #2 on the second.
Australia is #4 on the first and #6 on the second.
The US is #5 on the first and #13 on the second.
Luxembourg is #15 on the first and #4 on the second.
Zimbabwe is #155 on the first and #111 on the second.
Belarus is #150 on the first and #100 on the second.
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Corribus
Corribus

Hero of Order
The Abyss Staring Back at You
posted May 31, 2008 05:52 AM

Got any more points in the middle?  I can do a statistical analysis on it if you want.
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mvassilev
mvassilev


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posted May 31, 2008 03:36 PM

Well, you have the charts.
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Corribus
Corribus

Hero of Order
The Abyss Staring Back at You
posted June 01, 2008 03:43 AM

Righto- give me a little while, it will take me some time to import them all into Origin.
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Corribus
Corribus

Hero of Order
The Abyss Staring Back at You
posted June 07, 2008 06:00 AM bonus applied by angelito on 10 Jun 2008.
Edited by Corribus at 00:16, 08 Jun 2008.

Ok, mvass, your (brief, sort of) statistical analysis, as promised.  I apologize that it took me so long.  For some reason, my home computer was not running Origin properly, so I had to do all of this at work in bits and pieces.  It was also a lot more work than I thought it would be, as I had to import most of it by hand.  And of course I got totally carried away.  Which is typical.

First, you cannot use rankings, as it's not a fair way to do it.  (You also can't just pick the ones that fit your hypothesis. ) You have to use the actual values.  So I took the Indexes of Economic Freedom (IEF) and cross-referenced them with the Quality of Life (QLI) Indices for similar countries.  I made lists of both values and then plotted a scatter plot.  Then I did a linear fit to the data to determine the correlation between the two.  I also color-coded the points by region - I used the same region classification system that was used in the Index of Economic Freedom pages so you don't think I was being biased, although, I didn't really care for their classification system to be honest.  Anyway, by doing this you can see where countries from certain regions fall on the plot.  

So, without further ado, here is the scatter plot I came up with:



I have indicated a few select countries, including some of the outliers.  Unfortunately, the QLI did not include a number of countries that were included in the IEF; most of these countries were those with very low IEF scores (i.e., Sub-Saharan Africa).  Thus this analysis may be somewhat biased by the fact that many of the more restricted economies are not considered.  

My software will do a statistical analysis, and using this procedure I determined a correlation coefficient (R) of 0.712.  R is essentially a measure of how good of a linear relationship there is between two variables.  R ranges from -1 to 1.  A value of 1 indicates a perfect linear relationship; a value of -1 indicates a perfect negative linear relationship.   0 indicates no linear relationship at all.  One way to look at it is that R is sort of related to the average distance from the "best fit" line for each point.  The value of 0.712 means there is a fairly good correlation between the two variables, in this case quality of living and economic freedom, although the correlation is not perfect.  

It is prudent to note here before going on that correlation does not imply (necessarily) causality.  Thus even if the correlation was perfect, you could not say that economic freedom causes high quality of life.  Here's an analogy to show why.  Assume you plotted out the number of people who go to the doctor's office with colds on a given day versus the average temperature of the day.  You would probably get a good correlation between these two variables.  In fact, it is easy to point to a causation relationship here - as the temperature drops, more people get sick.  The correlation is probably not perfect because there are lots of reason (variables) affecting sickness, but clearly the outside temperature is one factor.  So we see by this example that the strength of a causation correlation depends on the number of variables involved, weighted by their degree of influence.   These relationships are of course not always as straightforward as this example.  For instance, instead of plotting the number of doctor visits against the outdoor temperature, letˇ¦s say you plot the number of doctor visits as a function of the number of bowls of hot chocolate consumed on a given day.  Probably, you'd find a good correlation.  So, you might be tempted to conclude that hot chocolate consumption causes people to go to the doctor!  But that's obviously not the case - correlation doesn't imply causation.  In this case, the correlation exists because the two variables share a common (partial) cause: weather.  So, it should be clear the unraveling the source of correlation is not always straightforward, particularly in complex subjects like economics.

So back to quality of life and economic freedom.  To understand reasons the correlation is not perfect, if we look at how the QLI is determined, we see that it is an average of scores (from surveys) in 9 categories*.  Let's take these categories a couple at a time.    The first three are:

Health: Life expectancy at birth (in years.)

Family life: Divorce rate (per 1,000 population)

Climate and geography: Latitude, to distinguish between warmer and colder climes.

Right off the bat, we might presume can eliminate life expectancy, divorce rate and climate as having little to do with economic freedom.  Economic freedom may influence life expectancy and divorce rate to some degree, but probably not as much as it does the other factors.  [Although, we have to be careful because influence is a form of causation - and correlation does not necessarily imply causation.]  Certainly, low economic freedom shouldn't inherently limit life expectancy or divorce rates.  Obviously since these factors are incorporated into the QL index, and they have presumably would have little correlation to economics or economic freedom, this will reduce your overall R value.  (Case in point: Cuba allegedly has very good health care, despite its abysmal economic freedom rating - 27.5, one of the lowest - this presumably would raise its QL score above what one might typically expect, based on our linear expectation, for a country with such a low economic freedom index).

Ok I actually got ambitious and curious, so I found a list of life-expectancy values and cross-referenced them with the IEF values.  Here is the result.



For one thing, we can see that that there is no straightforward relationship.  If you remove Sub-saharan Africa, though, you actually get what appears to be a roughly linear relationship between life expectancy and IEF.  I found this to be pretty interesting.  Of course, it doesn't mean that IEF causes higher life expectancy, but there seems to be some correlation between the two (R ~ 0.6).  Do they share a common source, or does one determine the other?  I'm not sure why Africa bucks the trend, but for these nations there seems to be little relationship between life expectancy and IEF.  Presumably these nations have a very low life-expectancy due to disease, famine or war.  To what extent those factors have play into economic freedom is unclear.   Note, also, that the statement I made about Cuba turns out to be true.  Given it's low IEF value, you might expect the life expectancy to be much lower than it is, but it's remarkably high.  As we'll see, Cuba is a fairly frequent outlier on most of these plots, and it is so on the "positive" side.  To my surprise, they must be doing something right!

With this interesting result in hand, I thought about also doing it with latitude and divorce rates, but this has already taken way too much time.  Maybe some other day.  I can't imagine that latitude has much to do with economic freedom or quality of life - but Jared Diamond may feel differently.

Political stability and security: Determined by political stability and security ratings.   I wasn't sure exactly what values were used, so I couldnˇ¦t do a more in depth analysis.  Are economically repressed countries more likely to be politically unstable and insecure?  I'd guess there's a good correlation here, and so this may contribute to the correlation between IEF and QLI.  Of course.. Stalin's regime was pretty stable, so... again the correlation isn't perfect.  

Gender equality: measured using ratio of average male and female earnings, where presumably a high ratio decreases QLI.  Given this is a ratio between male and female earning, I don't see clearly how this would impact economic freedom, which would presumably affect (if at all) earnings of both women and men equally.  Nevertheless if you look at the IEF vs. QLI plot, economically repressed countries tend to be in the Middle East, South America and Africa, which are also those that have relatively lower QLI.  These also happen to be countries that tend to be Islamic or devoutly Catholic or just plain extremely poor and politically unstable, where you might also expect to find enormous imbalances between male and female earnings - if women even work at all.  Is there a correlation between religious fundamentalism and QLI?  My guess would be yes - at least for women!  So chalk this up as a part of QLI that may strengthen the correlation between QLI and IEF, although not all countries in those areas are fundamentalist.  In any case, this is probably a time where correlation derives from a common source, rather than direct cause and effect, as I can't see an obvious cause and effect relationship between IEF and religion**.  Any ideas? (Note that the religion argument here also probably impacts the divorce rate factor above.)

Job security: Unemployment rate (%.)   Are economically free countries more likely to have reduced unemployment?  Well, we can find out.  Below is a similar scatter plot between IEF and Unemployment Rate.  These data are not all representative of the same year, so make of that what you will.  I think you can see that the correlation isn't great - it's a little negative but not enormous.  I'm not sure about an explanation, but the point is that here is another factor that probably weakens your correlation coefficient for QFI and IEF.  Notice that Cuba (with the lowest IEF score here) is again an outlier, with an unemployment rate that is actually below that of Hong Kong (which has the highest IEF score!).  Zimbabwe continues to be the absolute worst place to live, with over 80% unemployment.



Political freedom: Average of indexes of political and civil liberties.   I'm not sure what those indices are, so it's hard to put too much guesswork into this one.  Are politically free states more likely to be economically free states?  I'm inclined to think that while politically restricted states are also likely to be economically restricted, politically free states may not be more likely necessarily to be economically free.  That's just speculation, of course.  What about civil liberties?  I'd say the same thing.  So, my guess is that this probably weakens the correlation between QLI and IEF.  I'm open to other thoughts, though.

Community life: Dummy variable taking value 1 if country has either high rate of church attendance or trade-union membership; zero otherwise.    I don't even know what that really means.  I don't like the idea of using church attendance as a means of gauging "community life" or "quality of life".  I am also not a member of a trade-union.  So does that mean I'm less happy than someone who is, or someone who goes to church?  Hmm..  That aside, is this related to economic freedom?  I don't know.

Material well being: GDP per person, at PPP in $.  Alright, another economic factor.  Economic factors are usually related, right?  Well, I went and looked up GDP per capita at PPP (purchasing power parity) using again the CIA Factbook values.  As an aside, during this little portion of the exercise, I learned that economics is incredibly complicated and I understand very little of it.  So, make of that what you will.  Anyway, here are the results.  Keep in mind I used a log plot because of the large distribution of GDP values (over 2 orders of magnitude).  Otherwise, most countries are clumped at the "slow end".



Needless to say, the relationship between the two variables is quite complicated.  The dependency of the two variables is rather weak, as is the correlation.  Generally speaking, I guess you could say that economically free countries tend to have more GDP per capita, but the correlation and dependency is not nearly as strong as I would have thought.  I was positive there would be a clear, strong relationship, because it would seem to me economic freedom would be clearly associated with purchasing power.  Now, let me add that I tried to do a little research about GDP and PPP and quickly grew pretty overwhelmed by the details.  There are a whole bunch of "difficulties" discussed in the wiki article.  Make sense of it if you can, especially as it relates to this plot.  I'd love to hear some interpretations.  Also I'll point out that Cuba is again an outlier on the "good side" - the purchasing power of a Cuban is significantly higher than a lot of other countries that have much more economic freedom.  Although, before you all go buy a Castro-hat, their GDP in PPP per capita is still much worse than most of the other countries in the Americas, Europe and North Africa.  The other surprise of the day is that the highest purchasing power in the world can be found in Luxembourg.  Go figure.  

Anyway, I guess that's enough for now.  Hope it gives you enough to chew on for awhile.  If nothing else, I hope it gives you a sense that while in general economically free countries do have a higher standard of living, there's no way to make a causal relationship between those two variables from this data.  There are several countries that clearly defy that hypothesis, but besides that, the number of variables is enormous and the problem is quite complex.  Furthermore, it is also based on (IMO) a fairly subjective determination of what constitutes a high quality of life.  I'm certainly open for some discussion of these issues, as I was surprised on a number of occasions and don't have clear answers for all - nay, most - of it.  I have to say, this is the longest I've ever spent on a single post, but I guess it was worth it since I learned something from doing it. (It was also nice not to spend hours banging my head against a wall arguing about god and evolution for once...)

Notes:

*Actually, I think this would make a good thread in itself, as I don't think some of these are good measures of "quality of life".  Certainly climate may impact it, but latitude isn't necessary a good measure of climate, and in any case different people like different climates.  I wouldn't really be happy living in florida all the time, but some people love it.  Also, divorce rate is highly impacted by religion, and you can't really say that all marriages are happy ones.  Anyway, I digress, but the point is that since this "quality of life" index is determined by IMO somewhat arbitrary considerations, this may be another source of the weakened correlation between quality of life and economic freedom.

** I actually downloaded a list of countries and the % of citizens that are muslim and looked at a correlation plot of this vs. IEF.  There was not a clear relationship, although this may be because countries tended to be either almost all Muslim or very little.  With values polarized to such extremes, it was hard to make sense of the numbers.

EDIT: Edited to fix a problem with the GDP figure.  Thankfully, Denmark actually does have a decent economy.

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executor
executor


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posted June 07, 2008 12:45 PM

I am not sure whether I read the last graph correctly, but isn't Denmark's GDP in PPP per capita over 35 k $? And why is Cuba that high, they have at most 5000...
Maybe some data messed themselves up while you were doing this great work, Corribus?
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mvassilev
mvassilev


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posted June 07, 2008 03:17 PM

Excellent job, Corribus! I can't thank you enough. You really deserve a QP for all that effort.

Quote:
I can't imagine that latitude has much to do with economic freedom or quality of life
But you will find that all of the world's prosperous countries - except for Singapore - lie outside of the tropics.

Quote:
I don't like the idea of using church attendance as a means of gauging "community life" or "quality of life".
Neither do I. That's why this quality-of-life index may be slightly skewed to strongly religious countries. Thus, Iran and Saudi Arabia may be ranked higher than they should be, and many European countries are ranked lower than they should be.
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Corribus
Corribus

Hero of Order
The Abyss Staring Back at You
posted June 07, 2008 03:21 PM
Edited by Corribus at 15:21, 07 Jun 2008.

@Executor
You appear to be correct.  Probably a cut and paste error.  I'll check it out and update it sometime today.
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Ecoris
Ecoris


Promising
Supreme Hero
posted June 07, 2008 03:39 PM

Good. I just thought I had no purchase power.
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Corribus
Corribus

Hero of Order
The Abyss Staring Back at You
posted June 08, 2008 12:17 AM

Alright, it's fixed now.  I apologize to all the Danes out there; I didn't mean to imply that your economy sucks.

Thanks for spotting the errors, Executor.  I guess that means at least one person read all that.
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