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Billionaires shouldn't exist
Rank: Elder Joined: 7/1/2011 Posts: 8,804 Location: Nairobi
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@Fyatu, in this case, the Mathew effect is such that since those who have much tend to get more, then it is better to emulate and follow them so that we can also get a piece of what they have.
The critical factor here is that if there exists a law(s) that would make it sensible for us to emulate the leading pack. Such that, as long as there is a billionaire B then he/she must drop something of marginal difference M that is nontrivial even in the macroeconomic sense.
In this case, we could start thinking of proxemics, network value, insider information, exclusive clubs and the like. These are the very same variables that create and perhaps constitute corruption.
Besides, this is only a version of the trickle-down theory. This is the theory that is under scrutiny at the moment and it seems that it is untenable. The trickle-down is far too slow and of insignificant effect, that we should try to find other ideas to justify blind capitalism.
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Rank: Elder Joined: 7/1/2011 Posts: 8,804 Location: Nairobi
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Aghion and Bolton (1997) argue thus in the context of an endogenous system of interest rate determination: Quote:The main economic insight which comes out of our analysis in this paper is that, even though wealth does trickle-down from the rich to the poor and leads to a unique steady-state distribution of wealth under sufficiently high rates of capital accumulation,
there is still room for wealth redistribution policies to improve the long-run efficiency of the economy. In other words, the trickle-down mechanism is not sufficient to eventually reach an efficient distribution of resources, even in the best possible scenario. The reason why redistribution improves production efficiency is that with redistribution the poor need to borrow less to invest and therefore their incentives to maximize profits are distorted less. Thus, redistribution improves the efficiency of the economy because it brings about greater equality of opportunity and because it accelerates the trickle-down process. L. Randall Wray (2004) on the other hand thinks that: Quote:Perhaps the most important of Basil Moore’s contributions to economic theory is the recognition that the money supply should be treated as an endogenous variable while the interest rate should be taken to be exogenous. Are there countries or population clusters that have barriers regarding to capital having a limited range of options to choose from, even when it can be shown that there are other possible choices that are not part of the decision model in question? In simple terms, one can invest in what one can't sell due to the politics of existing markets. If true, then the above arguments can only hold for the global elites but isn't a general rule. The second quote is in conflict with the first. But the former was written after the latter. Meaning that up to now the matter of trickle-down has not set sail.
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Rank: Elder Joined: 7/1/2011 Posts: 8,804 Location: Nairobi
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Prof. (Dr.) Francis Arackal in 'Relevance and Application of Trickle-down Theory of Development in the Context of India' states that: Quote:The Trickle-down Theory proposes that as a country develops, there is a natural cycle of economic inequality driven by market forces which at first increases inequality, and then decreases it after a certain average income is attained. For, wealth trickles down from the rich to the poor. According to the Theory when the rate of capital accumulation is sufficiently high, the economy converges to a unique invariant wealth distribution. In other words the process of capital accumulation initially has the effect of widening inequalities but in later stages it reduces them. Further the theory says that the process of industrialization, democratization and the rise of the welfare state allow for the trickle-down of the benefits from rapid growth, and increase the per capita income. But according to a recent research done by the International Monetary Fund (IMF) this is not true. In fact, researchers found that when the top earners in society make more money, it actually slows down economic growth. On the other hand, when poorer people earn more, society as a whole benefits. Many of us are in fact exploited by the billionaire class using falsehoods that prevent any meaningful work, and living. There is a gross injustice happening that has been sanitized using theory, and the forces of envy that make the average wazuan crave for billions at the expense of the entire economic system.
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Rank: Elder Joined: 7/23/2008 Posts: 3,017
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Sorry @Tycho, Billionaires are self made. Here is a simple experiment that may never be done but which I am sure would prove this beyond reasonable doubt. If the world resources were redistributed equally among everyone in the world (assuming peoples personal abilities remain constant) then the billionaires would quickly accumulate billions once again while the majority of the world population would slowly but surely quickly consume their new found wealth and regress back to the comforts of the poverty they are used to. "The purpose of bureaucracy is to compensate for incompetence and lack of discipline." James Collins
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Rank: Elder Joined: 12/9/2009 Posts: 6,592 Location: Nairobi
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In my opinion, billionaires should exist. There should be no limit set on human achievement. Granted, there are thieves and rogue elements in society but these people exist through all segments, the poor steal each others chicken while the reach rob each other of tenders, business and our taxes. But I think the greatest achievers should be well rewarded else we will kill the concept of human endeavor for people who have the biggest dreams to aspire to, the likes of John D. Rockefeller and many others today.
BBI will solve it :)
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Rank: Veteran Joined: 1/20/2011 Posts: 1,820 Location: Nakuru
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tycho wrote:@Fyatu, in this case, the Mathew effect is such that since those who have much tend to get more, then it is better to emulate and follow them so that we can also get a piece of what they have.
The critical factor here is that if there exists a law(s) that would make it sensible for us to emulate the leading pack. Such that, as long as there is a billionaire B then he/she must drop something of marginal difference M that is nontrivial even in the macroeconomic sense.
In this case, we could start thinking of proxemics, network value, insider information, exclusive clubs and the like. These are the very same variables that create and perhaps constitute corruption.
Besides, this is only a version of the trickle-down theory. This is the theory that is under scrutiny at the moment and it seems that it is untenable. The trickle-down is far too slow and of insignificant effect, that we should try to find other ideas to justify blind capitalism. It is a fact that we live in a capitalist world. What you are proposing is a pure socialist system which is not practical in the current world settings where money = power. We have witnessed transition from communism to capitalism in erstwhile communist states like U.S.S.R and China hinting that Capitalism is here to stay. Capitalist powers like the USA and Western Europe and lately China and Russia will not allow democratic socialism to take root in the world. You can call it corruption but if capitalism collapsed today it would be Armageddon. Dumb money becomes dumb only when it listens to smart money
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Rank: Elder Joined: 7/1/2011 Posts: 8,804 Location: Nairobi
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Obi 1 Kanobi wrote:Sorry @Tycho,
Billionaires are self made. Here is a simple experiment that may never be done but which I am sure would prove this beyond reasonable doubt.
If the world resources were redistributed equally among everyone in the world (assuming peoples personal abilities remain constant) then the billionaires would quickly accumulate billions once again while the majority of the world population would slowly but surely quickly consume their new found wealth and regress back to the comforts of the poverty they are used to. @Obi, experiment design is determined by theories we hold dear. In this case we see that a theory you hold dear is that 'billionaires' are different from the rest of the population through certain qualities. Which unique qualities are these? Did you notice that the experiment set out to prove that billionaires are billionaires? Looks like a logical fallacy to me.
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Rank: Elder Joined: 7/1/2011 Posts: 8,804 Location: Nairobi
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2012 wrote:In my opinion, billionaires should exist. There should be no limit set on human achievement. Granted, there are thieves and rogue elements in society but these people exist through all segments, the poor steal each others chicken while the reach rob each other of tenders, business and our taxes.
But I think the greatest achievers should be well rewarded else we will kill the concept of human endeavor for people who have the biggest dreams to aspire to, the likes of John D. Rockefeller and many others today. There are always ethical, social and even temporal limits to human achievement. In this case let's consider the ethical limits. It is wrong for governments to favor a few people at the expense of the many who are deceived that they are the powers behind government. Consider contexts where children are the pickpockets of choice, why do we not say that we shouldn't limit their expertise?
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Rank: Elder Joined: 7/1/2011 Posts: 8,804 Location: Nairobi
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Fyatu wrote:tycho wrote:@Fyatu, in this case, the Mathew effect is such that since those who have much tend to get more, then it is better to emulate and follow them so that we can also get a piece of what they have.
The critical factor here is that if there exists a law(s) that would make it sensible for us to emulate the leading pack. Such that, as long as there is a billionaire B then he/she must drop something of marginal difference M that is nontrivial even in the macroeconomic sense.
In this case, we could start thinking of proxemics, network value, insider information, exclusive clubs and the like. These are the very same variables that create and perhaps constitute corruption.
Besides, this is only a version of the trickle-down theory. This is the theory that is under scrutiny at the moment and it seems that it is untenable. The trickle-down is far too slow and of insignificant effect, that we should try to find other ideas to justify blind capitalism. It is a fact that we live in a capitalist world. What you are proposing is a pure socialist system which is not practical in the current world settings where money = power. We have witnessed transition from communism to capitalism in erstwhile communist states like U.S.S.R and China hinting that Capitalism is here to stay. Capitalist powers like the USA and Western Europe and lately China and Russia will not allow democratic socialism to take root in the world. You can call it corruption but if capitalism collapsed today it would be Armageddon. 'Facts' are things which can be proven to be either True or False. We know that we don't live in a purely capitalist system. It is evident that the Bretton woods institutions were and are socialist in nature. A purely capitalist system can also not exist. What I am calling for is a redistribution of elements of this mixed economy to the rest of the citizens.
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Rank: Elder Joined: 7/1/2011 Posts: 8,804 Location: Nairobi
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The sad thing is that we may have forgotten that all these billions happen in a political context that assumes equality of rights and sovereignty, and that is guided by 'the promise of politics' where diversity of interests finds a fair division of costs and benefits. To state that I insist on strictly equal division of resources, is to misunderstand my position. My idea is more on fair division given truly autonomous choice. And by autonomous choice I mean all calculated options that a human may take to optimize between the unconscious and the conscious. I am speaking as a humanist. https://www.theguardian....re-capitalists-communism
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