The History and Future of Economics

Description

The purpose of this book is three-fold. The first purpose is to posit that the fundamental substance of the universe is energy, and that energy is required (consumed) for any material transformation, or information transmission. The labor theory of value, articulated by the physiocrats and elaborated by Adam Smith, David Ricardo, J.B. Say and Karl Marx was a rough first approximation of the value creation process, in the 17th and 18th centuries, but is now obsolete. Labor is now (mostly) performed by machines, not by humans (or animals). Acknowledgements Contents 1 From Pre-history to the Crusades 2 From the Crusades to the Renaissance 3 The Protestant Work Ethic and the Rise of Capitalism as Gods Work 4 The Enlightenment: From Leonardo to Galileo 5 The Rise of the East India Trading Companies 6 The “Glorious Revolution” and the BoE 7 Laissez-Faire and John Law’s Premature Invention of “Futures” 8 Classical Economics as Moral Philosophy 8.1 On Trade, Mercantilism and ‘Laissez Faire’ 8.2 Adam Smith and the Invisible Hand 8.3 Thomas Malthus and the Principle of Population 8.4 David Ricardo and Value-Added 8.5 Marx's Labor Theory of Value 8.6 The Communist Manifesto 9 Bentham and Utilitarianism 9.1 Precursors 9.2 Utilitarianism 9.3 Benthamites 9.4 Say’s Law of Markets: A View from an Entrepreneur 9.5 Sismondi: Booms and Busts 9.6 Dialectical Materialism and Academic Marxism 10 The Rise of Physics: From Newton to Einstein 10.1 Background 10.2 Variables 10.3 Mathematics 10.4 Crossing Disciplinary Boundaries 10.5 The Steam Engine 10.6 Falsification of Phlogiston 11 Energetics 11.1 Heat as Energy 11.2 The First and Second Laws of Thermodynamics 11.3 Entropy and Statistical Mechanics 11.4 Order and Disorder; Self Organization 12 Evolutionary Theory and Genetics 12.1 The Age of the Earth 12.2 The Idea of Species: Fossils and Extinction 12.3 Darwin’s Theory of Natural Selection 12.4 Mendel’s Theory of Inheritance 12.5 The Tree of Life 12.6 From Vitalism to Monism (Again) 13 Entropy, Exergy, Information and Complexity 13.1 Background 13.2 Complexity 13.3 Sources of Exergy in the Cosmos 13.4 The Standard Model of Physics 13.5 Entropy and Information 14 The “Marginal Revolution” in Economics 14.1 Mathematics in Economics 14.2 The Theory of Utility 14.3 Alfred Marshall and the Supply–Demand Diagram 14.4 On the Causes of the Great Depression 14.5 The Problem of Growth 14.6 The Production Function and the Solow-Swan Model 14.7 The Next Step: Adding a Third Variable to the C-D Function 14.8 Evolutionary Game Theory 15 Socialism and the Welfare State 15.1 Antecedents 15.2 Political Marxism 15.3 Utopian Socialism and Consumer Cooperatives 15.4 Henry George 15.5 Leo Tolstoy and Mahatma Gandhi 15.6 Social Democracy as an Antidote to Marxism 15.7 The Creation of the US Federal Reserve Bank 16 Keynes v. Hayek and the Monetarists 16.1 The Great Divide from the Old World to the New 16.2 From Woodrow Wilson to Adolph Hitler 16.3 Unemployment and Financial Crises 16.4 Unemployment and Wages, Short Run Versus Long Run 16.5 Money Creation and Monetary Policy 16.6 What Causes Recessions and Busts? 16.7 The Other Side of Capitalism 16.8 The End of the Gold Standard, Hayek and the Washington Consensus 16.9 SVM, Buybacks and Inequality 16.10 Positive Returns: Short Term Versus Long Term 17 The Future of Economics and the Economics of the Future 17.1 The Population Problem 17.2 The Problem of Resource Exhaustion 17.3 Pollution as an Inevitable By-Product of Extraction and Industrial Production 17.4 Energy Economics: The Price of Energy 17.5 The Avalanche Model 17.6 The Sources of Value 17.7 The Circular Economy? Appendix A: Bio-Geochemical Cycles A.1.   The Carbon–Oxygen Cycle A.2.   The Nitrogen, Sulfur and Phosphorus Cycles A.3.   Recycling of Scarce Metals and Phosphorus Appendix B: Climate Change: The Externality that Makes Everything Else Irrelevant B.1.   The Climate Is Warming B.2.   The Ozone Hole Appendix C: The Rise and Fall of the Nuclear Dream Appendix D: Capsule History