{"id":56233,"date":"2020-12-29T16:40:23","date_gmt":"2020-12-29T21:40:23","guid":{"rendered":"https:\/\/olduvai.ca\/?p=56233"},"modified":"2020-12-29T16:40:41","modified_gmt":"2020-12-29T21:40:41","slug":"the-priest-the-engineer-and-the-economist","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=56233","title":{"rendered":"The priest, the engineer and the economist"},"content":{"rendered":"<h3 class=\"post-title entry-title\"><a href=\"http:\/\/resourceinsights.blogspot.com\/2020\/12\/the-priest-engineer-and-economist.html\">The priest, the engineer and the economist<\/a><\/h3>\n<div id=\"post-body-4484352160403904204\" class=\"post-body entry-content\">\n<p>I was exchanging economist jokes over the holiday and heard this one that seemed apropos both to our resource predicament and the seeming abundance of the holiday season:<\/p>\n<blockquote><p>A priest, an engineer and an economist were stranded together on a desert island. Given their location, fish seemed to be a logical source of food. So, they discussed how to get some. The priest said that the three of them should pray. The engineer said he thought a better approach would be to fashion a net from materials on the island. The priest and the engineer then turned to the economist for his input. With his hand on his chin, the economist thought for a moment and then looked up and said, &#8220;Assume a fish.&#8221;<\/p><\/blockquote>\n<p>That joke neatly summarizes the problem with the vast majority of economic thinking today. Much of that thinking rests on something called the\u00a0<a href=\"https:\/\/en.wikipedia.org\/wiki\/Cobb%E2%80%93Douglas_production_function\">Cobb-Douglas function<\/a>\u00a0which has three terms:<\/p>\n<blockquote><p>Total production = Labor input X Capital input<\/p><\/blockquote>\n<p>What is so obviously missing, of course, are physical resources. Hence, &#8220;assume a fish&#8221; illustrates the slight of hand which most economists perform when referring to the physical world.<\/p>\n<p><a name=\"more\"><\/a>In fact, most economic growth projections simply forecast a certain expected (higher) level of demand for goods and services and then assume that the physical resources to meet that demand will appear. Which reminds me of a quote I shared over Christmas dinner that comes to us from economist\u00a0<a href=\"https:\/\/www.azquotes.com\/author\/5279-John_Kenneth_Galbraith\">John Kenneth Galbraith<\/a>:<\/p>\n<blockquote><p>The only function of economic forecasting is to make astrology look respectable.<\/p><\/blockquote>\n<p>And, I am reminded of yet another quotation attributed to economist\u00a0<a href=\"https:\/\/quoteinvestigator.com\/2018\/04\/28\/go-on\/\">Herbert Stein<\/a>:<\/p>\n<blockquote><p>If something cannot go on forever, it will stop.<\/p><\/blockquote>\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The priest, the engineer and the economist I was exchanging economist jokes over the holiday and heard this one that seemed apropos both to our resource predicament and the seeming abundance of the holiday season: A priest, an engineer and an economist were stranded together on a desert island. Given their location, fish seemed to [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[4752,4967,10003,681],"class_list":["post-56233","post","type-post","status-publish","format-standard","hentry","category-economics","tag-kurt-cobb","tag-resource-insights","tag-resource-limits","tag-resources"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56233","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=56233"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56233\/revisions"}],"predecessor-version":[{"id":56235,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56233\/revisions\/56235"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=56233"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=56233"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=56233"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}