Introduction to Economics – Part 1 – Murray N Rothbard

Part 1.

Introduction to Economics: A Private Seminar with Murray N. Rothbard

Starting with Crusoe economics, Rothbard builds the economic concepts which can be developed by this analogy.

These concepts are the axiom of human action. Among them are: man acts, man acts by virtue of his existence, man acts with purposeful behavior, man prefers present to future actions, resources are means to achieve ends, scarcity exists, actions take time, life is uncertain, and the theory of value is subjective.

Part one of seven from Introduction to Economics: A Private Seminar with Murray N. Rothbard.

This lecture as a Podcast: http://enemyofthestate.podomatic.com/

Sourced from: https://mises.org/library/introduction-economics-part-1

Source: Introduction to Economics – Part 1 – Murray N Rothbard – YouTube

http://www.readrothbard.com/introduction-to-economics-part-1-murray-n-rothbard

TRANSCRIPT

00:00
okay just start over I got an idea they
00:02
raise your hand those of you who are
00:04
taking a course at what’s an ox
00:05
maybe maybe over college micro or macro
00:08
economics how many here read then beyond
00:18
Bombay just an idea an Austrian stuff
00:23
certainly was okay okay I supposed to
00:29
start with first theme here is cusan you
00:31
know Mexicans marry who said we’re one
00:36
of the and one of the reasons for this
00:37
is that we perform at trial now I’m
00:39
doing this thing to nothing when
00:40
teaching economics but in this sort of
00:42
format right here but to start with a
00:48
show that is thick one of the things
00:50
that shows the distinctiveness Wall
00:51
Street economics is the method by which
00:53
it develops the assistance of discipline
00:56
and this is very different from other
00:59
economic schools so we started off with
01:03
with Crusoe almost a Busan was landed on
01:06
the so called desert Hana it’s not
01:07
really a desert really doesn’t it
01:09
probably die very quickly it’s an island
01:11
of resources it has he has technological
01:16
knowledge so first point I think the
01:22
theme is have it most of the economic
01:24
concepts can be developed just by
01:27
looking at who saw these I mean nature
01:28
where’s the idea this takes the star all
01:30
very simply with one individual without
01:35
bringing in other people yet which makes
01:36
it for some more complicated one
01:38
individual these not be nature and what
01:40
happens so I don’t know I can give a
01:43
steel first of any discussion I’d rather
01:45
sort of get a feel now what done what
01:48
any of you think starting with session
01:51
off what concepts can be approached to
01:53
this type of method historically so he’s
01:55
there it’s day one isn’t sure practice
01:58
standing there
01:59
in Iowa can we start with warmers what
02:03
do you think my concepts is they can be
02:05
developed
02:11
that’s for sure
02:15
anything more concrete than once he’s
02:25
got certain goals you got to achieve
02:27
pretty fast
02:40
next what you start with a sealed
02:42
waterproof day oh yeah hyelin if that
02:45
abides in French writers see that we get
02:58
that’s a little bit later on the
03:00
question what ownership is postponed
03:06
until we get to Friday mixes even if he
03:10
doesn’t know that maybe he knows to
03:12
begin with the island is wholly owned by
03:14
somebody else he would act the same way
03:16
yeah I just subordinates a lot of what
03:22
is happening that
03:35
okay seems cotton got certain priorities
03:39
and one of the things are one of the
03:43
concepts and you get out on many most
03:45
schools have this kind of differently
03:52
organizes we’ll see you later duck
03:54
priority no cake gone no choices
04:01
water these are not broken down they
04:22
start like this neck we hear they got
04:23
big thing or what are these as you go on
04:28
one bit more affluent their food your
04:31
food requirements become more
04:32
specialized like yourself there’s only
04:37
starting off with its quality now it’s a
04:46
bad you scale goals or ends or purposes
04:50
I want to thank my latest is so
04:52
interesting
04:54
I teach you the principle politic nice
04:57
to me or critique or broken Polly now I
05:00
first came in an apartment in social
05:02
science before I knew I was great guy
05:04
has these crazy ideas bitterly imposes
05:07
their place a fair this is a part of
05:09
half marks us and have lip gloss so they
05:13
had to give a lecture and and I started
05:17
off with goals and ends and means that
05:19
sort of stuff so basic axioms watch the
05:21
economics they fought this bitterly step
05:23
by step and refused to have anything
05:24
like gold
05:27
yeah because I think even though in
05:30
their daily in their regular scholarly
05:31
work much less their daily life they
05:34
realized that people have goals they act
05:35
on they were scared stiff that they’ve
05:37
concede at one point they have to line
05:40
up so it’s really weird to sit there for
05:49
now and having argue about people have
05:51
motors or goals or not anywhere else
05:53
okay so there go you’ve got we’ve got
05:56
gold and of course my sameness we’re
05:58
also assuming that people have both have
06:01
choices that can do something about it
06:03
which is the Austrian concept of action
06:11
and I know where that I can’t have goals
06:14
or purposes or ends and my exes it’s
06:18
wrapped up the concept of nation
06:21
priorities the value steals or
06:23
preference cables one of the things that
06:29
will go on here is that one of the
06:31
problems which cause confusion
06:33
economics is a linguistic are
06:35
semantically so the words that a user
06:37
has such as historical reasons for those
06:40
people start example awake economics you
06:42
began really together systematically
06:46
began writing since the early 19th
06:48
century England with agricultural Somali
06:50
the words is the man agricultural base
06:53
are virtually basic we have a different
06:55
language masses it’s a little difficult
06:57
it will see me go along for various
07:00
reasons this that uses your purpose
07:02
books it was cool
07:03
if you can utility so already this
07:06
already causes confusion because most
07:09
people need to think of utility take
07:10
something which is useful it’s not
07:29
critics of any array so the people I can
08:08
would say well these are not certain
08:10
goods and services which he likes of a
08:13
comb useful kind of objective sense
08:14
other things which other people like not
08:17
useful quarrel for example back on 1959
08:23
I launched their work Cadillacs
08:26
those days have tailspin if you remember
08:28
and biggest area my people left liberals
08:32
attacking tail feathers the evils me
08:38
there’s nothing wrong
08:40
so the point the point is that that
08:43
utility that means doesn’t mean any
08:45
comics what somebody he says is
08:47
objectively useful that supposed to mean
08:49
it means whatever people is useful to
08:52
them but they would like to achieve what
08:54
goal isn’t like whether other people
08:56
call that wrong irrational waste for
09:00
whatever was utility and economics
09:03
they’re sort of in Washington economics
09:05
as a subjective connotation it’s
09:07
subjective evaluation in the part of the
09:10
person the actor or the individual
09:13
consumer
09:14
okay so that doesn’t mean that like such
09:17
things not terribly useful or not useful
09:18
point is the point of looking at
09:21
economics looks at employee movie
09:22
individual outdoor so alright the this
09:32
by the way was always a problem when
09:33
working with radians Brandolini an
09:38
objective value so how can you have a
09:40
theory of subjective values problem
09:44
Iranian source the answer is we’re not
09:46
talking about this is not an ethical
09:47
course in ethics economics inaudible
09:51
discipline if you kill a man I think she
09:53
could say something might be objectively
09:54
good or bad useful or not useful
09:57
economics analyzed at the individual
09:59
actor as he or she acts in the southern
10:01
theme value was the valuation of a part
10:04
of this first value freedom and object
10:07
together
10:09
spidey feet on the part of economist it
10:12
says that we’re not imposing our values
10:13
on individuals situation another thing
10:20
many Austrian economics I think unique
10:22
is that what we’re doing here is we’re
10:24
taking certain common-sense facts such
10:27
as people act goals and purposes and
10:30
basing them any kind of discipline on
10:32
that formal fact they’re not going to
10:33
the question of what what is what his
10:36
purpose is our case accrues my food and
10:38
shelter etcetera but basically we don’t
10:40
really care what the purpose of
10:42
individual are the fact that he has
10:43
certain purposes and goals are achieved
10:45
that’s what we need from this apart so
10:47
that it just doesn’t he cannot mix what
10:49
he should be valuing or you know whether
10:53
he’s a nut for doing it it’s not ask
10:55
whether you should be these you’re
10:57
eating butter or cornflakes or something
10:58
that’s that’s another discipline
11:00
aesthetics FX right boy so that’s that’s
11:04
the one of our confusion which come in
11:08
okay so we have we’re just really
11:10
beginning with us
11:12
we have action concept of action
11:17
anything else I’d like to see is it what
11:19
sir
11:19
the ply then actually who so okay Scott
11:25
where’s he got he’s got to try to keep
11:27
away from the actual content like get
11:29
out I mean he always had that example it
11:32
shoots deep as a bow and arrow or
11:34
something or catches fish with a net
11:36
basically the idea is what what sort of
11:38
thing where sort of concepts come in
11:39
here
11:40
what is he got he’s got his own person
11:42
I’m soft and he’s not okay he’s only
11:47
gonna achieve his goals my mother says
11:49
nope nothing else there he’s gonna be
11:51
doing it he’s got about personal energy
11:59
and you’ve got technological knowledge
12:01
make no sense the combine of course so
12:04
the point has been conceptually say that
12:06
technological technological course in
12:08
this case it’s not high-tech computer
12:10
program good here tech knowledge of how
12:15
to catch fish building a net getting a
12:17
bow and arrow or whittling a steak all
12:19
of our stuff is this is locusts and he’s
12:31
got natural resources he looks around
12:33
see what’s going on with those trees is
12:34
very easy getting strawberries it’s
12:37
there’s fish water and so forth all
12:40
these things are nature giving so we’ve
12:44
got the natural resources
12:50
working at any concepts we get how many
12:53
concepts are coming in here
12:56
now again economics for the weight again
12:59
the semantics of difference this
13:01
language was sent in early 19th century
13:04
personal energy is the fine that has an
13:06
economics later
13:11
the problem here is waiting for example
13:14
in as a big used to be a big discussion
13:16
of controversy in the history of the
13:19
Jack’s Andrew Jackson period – States
13:21
1830s were they or the Jacksonians labor
13:25
leaders or they relate some some sense
13:28
like the press were they early year
13:31
ancestors of New Deal some Ewoks
13:34
Esther’s they said they were in favor of
13:37
labor they kept talking my labor long
13:39
time since Marx most people think of
13:42
labor or laborers of the industrial
13:44
worker assembly malonic types
13:46
construction labor in the night in the
13:49
early 19th century 18th century sense
13:51
met anybody who’s muses personal energy
13:54
and production in the Frank reduction
13:55
yet
13:56
anybody who transformed resources
13:58
learnings into using personal energy to
14:01
this modern in the world with me not
14:03
just industrial workers but the
14:05
president of General Motors along with
14:06
the assembly worker anybody was using
14:08
personal energy production process as a
14:11
laborer so it’s already easy cause all
14:16
sorts of problems of you’re looking at
14:17
current twentieth-century
14:19
terminology economics just
14:27
Natural Resources is almost a similar
14:29
problem actually also the finding
14:30
affected land
14:33
and again so this is the gun difference
14:39
here one is length includes water rivers
14:44
fish and fish or excludes offshore oil
14:47
this point doesn’t just mean land on the
14:49
sense that we used to body and stuff
14:51
soil and stuff now look some space get
14:55
something off space include radio
14:57
frequencies all of us is lying that
15:00
might make sure given okay so on one
15:04
hand it was much more would be common
15:06
sense now they stick out his land and
15:08
the other hand also investment through
15:09
the buildings for example this about
15:11
this building about this Atlanta
15:12
technically that leagues man-made would
15:16
be a surgeon plant would be the ground
15:19
underneath the dock yeah it must’ve
15:36
harvest them yeah domestic it’d be
15:39
something else which I never got to that
15:41
cat something else is he as soon as man
15:44
enters another picture and transforms
15:46
things Indian or something else land is
15:48
always there for joy we have some
15:49
grandma stand on so Lena look always
15:52
enters into the picture but this other
15:55
other site and others think thinking
16:02
what is specialist I don’t keep talking
16:16
I would distinguish your team unknown in
16:19
own natural resources but I don’t see
16:22
the distinction between distinguishes
16:25
between an apple tree in the apples of
16:28
bears and the piece of land that it
16:29
grows up really really that’s of a
16:31
section we have mean I see certain
16:33
reason for distinguishing but not in
16:34
Genesis Netherlands well I thought would
16:37
be nature against me not as rolling yeah
16:51
ownership London everything Susan I love
17:01
this lazy office of technical knowledge
17:15
because I include that with with labor
17:18
in the sense that the old idea of labor
17:21
was to the executives and so on our
17:24
Labor’s to the adventures and so on and
17:27
the technical knowledge and the personal
17:28
energy cannot really be distinguished
17:30
and separated and they’re running the
17:35
art from a Marxist point of view I agree
17:36
I should see the problem is to the
17:41
things about technological knowledge
17:43
different
17:44
although resources once once you get it
17:49
I’m gonna lose it
17:51
missus I want sex non scarce what you
17:55
it’s not personal energy is gonna sue
17:58
government is is use that what is used
18:00
up get tires from technical knowledge if
18:03
you don’t you got it anyway what’s the
18:05
rest of beeps be increased I can be
18:07
passed recipes another word for it right
18:11
it’s a little different
18:13
conceptually for second as well as is
18:15
important so okay all I was thinking it
18:22
was gonna see these basic categories of
18:24
economic resources to the one is land
18:26
and the other is labor and so technical
18:28
knowledge if you go split it that way
18:29
what helps with late up so obviously
18:31
make sure okay another thing person he
18:42
finds that this is I like to store with
18:46
my classes at my job that I call the
18:48
Garden of Eden model the garden of eatin
18:51
either mythological or actual there was
18:54
super abundance most years definition
18:57
the Garden of Eden is a super fun you
19:00
want to have a Pepsi fairly nice throw
19:02
you wished before you snap your fingers
19:03
and by God there it is that’s the going
19:05
to be there are certain illogical
19:08
problems are being modeled
19:09
supposing I wish for another Shen
19:12
languages for a clash okay but aside
19:15
from that by definition that everything
19:18
is super fun are they super fun of them
19:20
there’s no problem type of a property
19:22
ownership the probable price of scarcity
19:25
or anything so economics because we want
19:27
something that’s there you want a hi-fi
19:29
set as they’re playing baccarat mean one
19:32
so that does presumably many times in
19:35
the garden be in some sense originally
19:37
it was kicked out for ice sends in
19:40
heresies so what Cousteau faces of
19:43
course talking when we all face is the
19:47
world of scarcity all things are scarce
19:49
resources
19:50
or living services etc and because
19:54
they’re scarce they have you have to
19:55
allocate hmmm the bad news Kendall’s
19:57
Cusco campus el chalen 1 because the
19:59
nice suit of clothes from Brooks
20:00
Brothers and I wanna you know make the
20:03
last cut and so forth
20:04
you ain’t gonna get to do stuff as mean
20:07
is the Halleck a has time that’s
20:09
allocated energy has allocated has have
20:12
priorities new the first things first to
20:14
work so on so he’s going so we live in a
20:16
world of scarcity of course clearly we
20:19
have what scared we are more scarce even
20:22
less than say screw start obviously
20:23
scream scarce problem dies tomorrow he
20:27
doesn’t get food quickly
20:29
we’re noting that reading obviously code
20:31
we have we still have a world of
20:32
scarcity things worse there’s everything
20:34
to be free which is your Pepsi their
20:40
intellectual fashions I don’t know
20:41
shocking people but their intellectual
20:43
world or fashion some social sorta like
20:45
ladies hemlines every five years some
20:48
new gimmick comes out every wife follows
20:50
it and one of the one of the few
20:55
benefits of advanced age is you see all
20:57
these things come and go same junk comes
21:00
back ten years later at Rob’s ass so
21:03
about ten years ago granite heard the
21:04
new left for a couple years there was a
21:07
big those a big hue and cry and that’s
21:08
so much money Thomas amongst some fun
21:12
intellectuals sociologists
21:15
people about a old English professors
21:18
but we not living a post-scarcity age
21:20
all these things almost economic stuff
21:23
about prices and all that it almost true
21:25
until nineteen sixty sixty eight the
21:27
madness of 1965 now I’m gonna post
21:30
here’s the age you know everything’s
21:31
great I don’t need what stuff is now
21:33
obsolete so I had a debate one time of
21:36
them neo-marxist professor you give me
21:40
this whole line of chatter probably
21:42
includes them almost always does you
21:43
have that social whatever the problem is
21:46
Thunder puts new stage therefore the
21:49
total unemployment never social but
21:53
anyway sync this time we now live in a
21:55
post here’s the age-old economics
21:56
Cruiser obsolete system look trust if we
22:02
live on a post news day you want if you
22:03
burn your salary check what’s the point
22:06
of having an income it was an answer
22:08
with unbeli missus well it’s for like
22:10
two hours later the same people were
22:27
saying the pro skiers evening drops out
22:29
Sankey were saying over resources are
22:31
Donnie I got five years it’s amazing
22:52
so a wheel of scarcity and I say as the
22:57
world progressives me unless less things
22:59
about West cares but still there
23:01
the okay so that comes obviously comes
23:06
in our old who saw action if I actions
23:08
really this you need actually feathers
23:10
scarcity having to cheat your goals yet
23:13
okay he’s got it looks around he’s got
23:16
the he’s got to sing to reach the goal
23:19
that reason worse about personal low on
23:21
energy
23:22
logical knowledge and these are his
23:24
resources or means equal to means
23:29
achieve the enemy’s resources means
23:33
otherwise I’m playing here he’s got
23:36
priorities got goals handsome church
23:39
even he has to use these resources
23:40
allocate them you know the thing is that
23:50
almost takes time right action takes
23:52
time so weeks everybody else yeah yeah
24:55
one of the problems is that by the way
24:59
they don’t see from our endings one of
25:01
the problems of randomness theory just
25:04
go be tangential the Randian type of
25:07
thing is if time of unlimited
25:09
allocating time
25:13
in one career for 20 years they move on
25:16
another group of 30 years is something
25:18
that some are certainly certainly not
25:20
certain that this time we’re sort of not
25:22
a problem okay because how many people
25:27
should be aware of that some of us yes
25:31
but there’s always that meantime there’s
25:32
always scarce anyway the UM there’s
25:42
another factor Kendra’s that what you
25:45
can distinguish is no strings for
25:46
everybody else family life is on cert
25:48
you know things are something happened
25:51
it’s sort of thing but it’s uncertain
25:53
you don’t know who so might be a
25:55
hurricane tomorrow the whole fish or
25:58
something
25:59
strawberries gets white that so one
26:03
search so one of the things that again
26:11
distinguishes one string theory is the
26:14
Austrians incorporate uncertainty into
26:15
the picture into the analysis every
26:17
weekend life is uncertain things can
26:18
change
26:19
you don’t have perfect knowledge of the
26:21
future you know this gives a we not
26:24
already have a deviation within the
26:26
Austrian movement something Austrians
26:29
and I belong too far so a jingyan
26:31
denialism
26:32
like that’s a lost one it’s not that
26:35
recur
26:35
and there’s got another pointer saying
26:38
that we can’t know anything about the
26:40
future future solar took white wool
26:42
can’t predict or forecast anything so
26:49
that’s but basically the the washing to
26:52
do is that there’s that there’s there’s
26:55
no certainty in the future it was
26:57
something
27:00
the contrast neoclassical economics or
27:03
standard textbook economics which is
27:05
essentially while reasoning at this
27:07
point
27:18
Swiss Thomas wrote in 1917 1880s his
27:24
famous works published same years I
27:26
think he’s something around there early
27:30
eighteen seventies and miles and
27:33
Switzerland neglected during his
27:37
lifetime I think properly so we discover
27:42
my Pareto who’s a brilliant sociologist
27:45
latest a person anyway the chun-yin and
27:51
genomic ami standard more or less than
27:54
of microeconomics many will prefer any
27:57
of us and the one of the things which
28:02
the duration of Arabians one of the
28:05
theory who everybody’s got perfect
28:06
knowledge or beyond the present perfect
28:09
on for everybody uh finality the future
28:11
no uncertainty about time either Oh tiny
28:15
and sense drops at time to come let me
28:18
put this way if you
28:29
I see if you look at this way you make
28:31
things a little crackers this is the
28:34
Orthodox mainstream economics it’s
28:37
perfect certainty if you live in a world
28:41
so why does this make these are world
28:43
without change we know or change to be
28:46
perfectly forecast before they make that
28:47
change but in time become something
28:50
great different from what human beings
28:51
are experiencing time becomes an endless
28:55
round of everybody the same science
28:57
knowledge is frozen like a freeze frame
29:02
intelligence frozen of course everybody
29:04
that’s perfect because don’t change so I
29:07
think new enters the picture think hey
29:09
this is the world Moravians be picked
29:13
and this is what mathematics equations
29:18
Iran because if everything is there no
29:21
change there’s no uncertainty there’s a
29:23
perfect novel everybody’s not perfect
29:24
not only you can just crank it out so
29:26
action actually disappears while raising
29:30
universe and get something later so this
29:34
is very different by the economics ok
29:40
uncertain that means that each
29:44
individual person post on everybody else
29:47
around on certainty bearer he’s out of
29:49
meat I mean certainty and this function
29:52
of being uncertainty which we’ll explain
29:53
later on which one ETL so
29:55
entrepreneurship in he you know he has
30:00
he noses his goals he wants of good
30:04
inventory of resources but now he’s got
30:06
it on and then by doing that he’s gonna
30:08
got forecast hopefully correctly he’s
30:12
gotta meet conditions and frontage and
30:13
try to achieve them if he makes too many
30:16
mistakes he’s dead our case you have to
30:19
make station except for monetary losses
30:22
so this is up this is the inverter the
30:27
uncertainty bearer
30:35
another thing back to South beauty is
30:38
given the goal different goal let’s say
30:41
it’s the old thing no a gallon of clean
30:44
water given the goalie he wants to
30:46
achieve a goal with rapidly as possible
30:48
definition follow us on that such
30:51
fashion you’ve got a goal you’re
30:53
probably having out on water mountain
30:54
and wait two weeks so this meeting
30:59
brings in the Austrian concept right
31:00
permits 24 hours basically means I think
31:13
properly understood between the
31:14
important concept of D first given them
31:17
the goal of a person refers getting a
31:19
goal
31:19
now they’re getting it later otherwise
31:22
it’s not really built as also so
31:28
disputes about that characteristic want
31:31
something like this it’s now winter but
31:36
Mikey a pre refrigerator a if you can
31:38
use ice ice boxes and what you don’t
31:42
need ice boxes there isn’t even a summer
31:45
therefore if you’re here this is
31:47
December you prefer getting the ice July
31:52
we’re getting it now doesn’t this
31:54
contradict constant entire purpose of
31:57
preferring something now later the
32:00
answer is it doesn’t contradict it but
32:01
it’s not the same problem where it’s
32:03
assuming we’re given the goal given the
32:05
good good the thing and stuff and then
32:08
the resources softly the object we’re
32:12
valuing
32:13
we’re seeing a homogeneous object we’re
32:16
assuming is the same same serviceability
32:18
these faults of my different engine so
32:23
that ice in the summer becomes a
32:26
different good you know it’s the same
32:27
physical object saint cube it’s a
32:30
different good in the summers isn’t
32:31
winter perform different functions
32:32
importantly sorry I mean it worked I’m
32:35
just ugly
32:36
it’s hotter in summer any ice before so
32:38
the answer to that is something the two
32:40
different Fox given the product given
32:42
the good different thing in that given
32:44
me be cool usefulness people refer you
32:57
got a choice about the penguin something
32:59
down huh or letting someone by a fully
33:01
charged monster we don’t need to the day
33:05
I’m sure then you know so I think late
33:10
you know fundamentally so she’s used in
33:12
time because the resource the same sure
33:14
you’re balancing with the proc the end
33:16
of a goal the value stare with what you
33:18
have you would get it absolutely they’re
33:20
sure it’s all the keys people prefer
33:23
less late night right any other comments
33:36
on missus
33:45
all right the a good model even having
33:50
to find it good it’s important and so we
33:52
should use but as a thing they’re a
33:55
commodity or a service either tangle or
33:56
intangible which consists of entity
34:03
which is valued by somebody obviously
34:05
although it’s not good he’s my crew so
34:08
RBI serves our mics an entity with
34:11
consisting of n homeland genious units
34:20
this is release of the ice and took
34:27
anything from one up to advanced 100
34:29
minute the idea those units have to be
34:33
knowing genius that was are the same so
34:37
cameras are not agreed and paper clips
34:39
or the slides paper clips that were
34:41
boxes identities 50 paper clips each
34:44
paper clip is a unit or the box
34:45
you know Tina’s can marry the ideas of
34:48
each each unit is home ingenious telling
34:50
you yeah
35:20
it’s never the same
35:22
I don’t think it’s ever this I don’t
35:24
think it’s never the same I meant to the
35:25
IceCube them
35:26
July me any given my stomach see them
35:29
the thing is it’s up to the purse that
35:32
the end of the jewels Here I am ago I
35:35
don’t care which block of ice that say
35:36
it’s the same size send our yes by nice
35:40
block of ice
35:41
I don’t care about myself I get it it’s
35:44
home and jeans to me it’s fiscally only
35:46
days and it’s nothing jeans to me but
35:48
you can’t tally see as an outside
35:49
observer an economist or statistician it
35:52
can’t really be sure ingenious because
35:54
each in different individuals might have
35:56
different valuations off season one of
36:00
the things about again about what can
36:01
you not make says it it provides very
36:03
and one of these is why it’s not popular
36:05
among economists is provides very little
36:06
mystery Congress to do much as well
36:10
kindness to teach this and explain the
36:13
beauty of it we can’t really
36:15
we can’t advise government provides
36:17
reason to get down probably so already
36:19
and you can advise business many there
36:22
we haven’t got meeting any there’s no
36:23
there’s bring a little job opportunities
36:25
for all students except teacher writing
36:28
whatever and so the economist doesn’t
36:31
have that and you know that’s not
36:32
observer didn’t have that much of a role
36:34
because you can’t really say that most
36:36
thing example an eel classmate classical
36:39
economic totally differently say this is
36:41
the object of unit and therefore the
36:43
same good
36:44
let’s take I think John Stuart Mill
36:54
any rate he’s a very bright guy till
36:57
he’s screwed up Milas looking at the
37:01
market economy called economic man great
37:04
finishes cuts up and he’s looking at the
37:07
marketing sees that we according to the
37:12
Economic Analysis tent goods tend to
37:14
have the same price we got the price yet
37:16
but it’s pretty clear and I would hang
37:20
out of a block of ice some of these two
37:22
people exam three for ice dealers on the
37:24
same block let’s say the prices will
37:26
tend to be about equal Joe’s Zeke over
37:29
here is selling ice for you know
37:31
whatever $50 a pound I know how you
37:34
stall eyes anymore fifty I was a cube
37:36
something else is something in the $30
37:38
Kulick on Zeke is not gonna last right
37:41
not the lower the price understand
37:44
business so so mill is observing a
37:48
little the worldly saying wah-wah
37:49
there are situations where they have
37:51
different prices are making for the same
37:53
good continue almost permanently
37:55
therefore it’s irrational having these
37:56
people are non economic men yeah they’re
38:05
there and the point when he is using the
38:08
physical object rather than the subject
38:10
evaluation of the individual consumers
38:12
so many of these consumers are different
38:14
the same thing might be different good
38:15
or the different good I think many
38:16
people same good and for example first
38:20
there six changes to I mean the one I
38:22
says two jerks my buddy might give
38:24
premium delivery service you know the
38:25
exact regular though is that the good is
38:28
all designed by gets like this I’ve got
38:30
another big an Austrian inside when
38:32
you’re buying something
38:33
by a physical object buying the whole
38:34
package the ambiance well the guy’s
38:36
friendly or not whether the service that
38:38
he gives credit the whole bunch of stuff
38:40
is involved which most people look at
38:44
for example New York they have very posh
38:48
restaurant tests and they saw my screen
38:55
let’s say let’s assume it probably it’s
38:57
not the same IP let’s assume from that
38:58
it’s the same ice cream you know
39:00
McDonald’s or Breyers fast food store
39:03
and yet you know in Testament charge at
39:06
ten times as much the same ice cream the
39:09
reason is you’re not just buying a
39:10
screen buying a whole ambiance you’re
39:11
buying this serve our waiter is buying
39:12
the expectation of maybe seen Jackie
39:14
Onassis like that reason why is a
39:34
different price and it spaces different
39:36
prices you’re blinding the ice cream
39:38
plus the whole surface ambience when you
39:59
add all these other things to race
40:01
that’s also a good but it’s not the same
40:03
good it’s just ice yeah yes penis leaves
40:06
the whole package buying I mean you
40:08
don’t buy the pure ice fine I mean if
40:12
you never mean anything themselves never
40:15
write a book anytime always buying okay
40:17
what can the media consumers the same
40:19
everything
40:26
well in fact we’re going back to what
40:29
you were saying about ice cubes apparel
40:30
ice cube equator
40:32
not a lot of value to because outside on
40:38
the crunching step something you can’t
40:40
do that so many people are just in this
40:49
situation why things have different
40:54
values I’m trying to understand the
40:55
definition good because that’s used all
40:57
the time yeah this implies why – morally
41:16
nobody’s here is a different good yeah
41:19
but right now there’s seven units of
41:21
homogenious you buy these six I don’t
41:24
care this crisis innominate said these
41:26
are homogeneous debates right this is
41:31
there’s a degree yeah beyond which
41:32
because even the glass that you’ve got
41:34
your hand on is closer to do and it is
41:36
slightly better for you pushing the
41:38
other one is further away it’s so
41:40
they’re rising anger what I’m saying is
41:42
because they are physically identified
41:44
all units they’re never exactly the same
41:47
but this is a length less things mostly
41:48
yeah I like you
41:49
washes out you only care about these two
41:51
inches yes that’s true it’s not for the
41:53
individual again when we care doesn’t
41:55
care so I mean those if you have 5000
41:59
paper clips all the same size on a bowl
42:01
you know I don’t care about which paper
42:03
about that paper goes they’re coming
42:04
genius and most people are becoming
42:05
somebody else how learn to be in some
42:07
not their own
42:25
other forms of economics assume that ice
42:29
cream ice cream and the same value
42:32
everywhere in every person correct
42:34
whereas austrian-german expects any good
42:38
in a given transaction
42:44
see the point is of guest employment is
42:46
a beat what you’re doing is you’re the
42:49
menacing of Mobile be outside economists
42:51
observer just trying to figure out
42:53
what’s going on most people so that he
43:01
can’t then say that they’re irrational I
43:03
see this I’m giving an example we have
43:05
the first of Austrian
43:07
I just say maybe the distinction is that
43:09
you want to describe a bit as a physical
43:11
object that’s the only way an objective
43:13
observer can describe if it’s only me
43:15
that’s in the consulate appreciated ice
43:17
cream is what was in this thing well
43:20
Austrian would say you are observing
43:23
into all characteristics of it all
43:25
benefits of it possible in other words
43:27
which to me
43:29
well depends on the individuals in most
43:31
cases men would be right
43:33
in most cases empirically doesn’t make
43:37
giving example first Austrian conference
43:38
first modern wants me to comprehend
43:40
outside a little Austria first one more
43:42
time well tell it 1973 at a wild place
43:46
90 we cool
43:48
gently for some reason before the crazy
43:52
place for Royals in college in Vermont
43:54
the southeastern Vermont its place which
43:56
is wellness of the income and stand of
44:01
living in 1915 50 movies so like a slice
44:10
out of college is a fake college or
44:16
slightly weird times of town was a
44:18
college line at the preneur it was
44:19
essentially a crook so the fake college
44:22
that a fake Law School pick up the towel
44:24
anyway so hilarious thing sometimes
44:26
going to the anecdotes I’m being honest
44:28
so one of the things was that they had a
44:30
grocery store this teeny town looked up
44:34
Cavill in your soul there’s a big
44:36
village green you’re coming and houses
44:39
on the outside are nothing else beyond
44:41
them so like the village nobody ever saw
44:48
me by the pen there’s only sold in there
44:51
anyway so to grocery stores kind of
44:54
course to speak to each other like 10
44:56
feet and we observe the prices these are
45:00
totally different the same product one
45:02
store same cake your soap charging you
45:06
know 50 Cent’s data source is 25 you’re
45:10
gonna be getting mine belonging here
45:11
cause going on economist how we analyze
45:14
this so somebody found them we finally
45:17
found on the villagers there how come
45:21
this is going out comes Isola get here
45:23
is trying different prices with Jase
45:24
some other things in this town
45:26
two groups of people really those two
45:28
groups of people like that each group
45:29
each each other’s guts one group one but
45:34
only goes through these the other growth
45:35
only goes to Jase and none of them will
45:37
course compete and no marginal buyers or
45:39
shipping on the other
45:40
that’s a non competing grocery store Wow
45:44
so that happens it’s a little nutty but
45:46
that’s its farm wife so usually the
45:49
price of a soul will be the same in this
45:51
peculiar situation where everybody’s got
45:54
values where’s East I have I must double
45:56
Z going to Z somehow more important than
45:58
the actual price of product so that’s
46:01
what happened generally it’s true
46:13
you

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