Tuesday, October 14, 2014
Sam McDonald Chapter 6. Question 6
A specific passage that stuck out to me in chapter six of Naked Economics was the passage about the labor fallacy. In a previous blog post I wrote about how the French government failed to understand this fallacy, but that passage did not explain the specifics. So when I came across this passage I my interest was sparked. The analogy used was a community of farmers who produced just enough to sustain their livelihood, but nothing more. If someone came into the community looking to farm, they would send the person away because that individual has no human capitol with which he could benefit the community. In this same community, if a man with a PHD in agriculture came in he would be accepted and would in turn create new jobs due to the capitol he could provide. (i.e. plows). This analogy can be applied to the real economic world. Since there is not a fixed amount of jobs, immigrants to the U.S. are not actually "taking our jobs". Rather if they bring human capitol (education, entrepreneurship, etc.), then they have the potential to increase the jobs with in our country and create an ascent in our economic standing.
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