Production | Economics for People with Ha-Joon Chang
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- Опубліковано 5 чер 2024
- So much of mainstream economics today is focused on market exchange that it’s easy to neglect production itself. In this ninth lecture in INET’s “Economics For People” series, Ha-Joon Chang explains the nature of production and its evolution.
About “Economics for People”:
“It is extremely important for our democracy to function that ordinary citizens understand the key issues and basic theories of economics.” - Ha-Joon Chang
Economics has long been the domain of the ivory tower, where specialized language and opaque theorems make it inaccessible to most people. That’s a problem.
In the new series “Economics For People” from the Institute for New Economic Thinking (INET), University of Cambridge economist and bestselling author Ha-Joon Chang explains key concepts in economics, empowering anyone to hold their government, society, and economy accountable.
Years ago my PE firm expanded, took on extensive new office space which it gutted and customized. One part of the design was an immense mailroom - for PE back then, the production of Deal Books (50-100 page presentations spirally bound) was a huge part of the mail room staffs' work. In reviewing the design, I asked the (extremely expensive) designers if any of them had talked to the head of the mail room for in put. None had. I walked down to the Mail room with the three person design to talk with the head of the Mailroom - who took one look at the design and said "this won't work at all. She proceeded to draw out a work flow diagram of how she and her team actually work. We went with that design.
Adam Smith only uses the word invisible hand once, but every textbook that has ever cited him always associate him with that principle
This prof made me venture into economics
Ha-Joon Chang is an amazing professor
So it's important for each industry to have some passive knowledge of any industry that they may be working along with.
For instance any individual who wants to improve an assembly line must have hands on passive knowledge in that field that a textbook can't give them.
It would make sense then for an individual to be put into an industry while learning their subject field, be it finance, engineering, policy, environmental, etc, to observe it. This would still remain true even after a graduate has finished, if they are the innovative type, and not setting to time tested techniques or positions.
So it should make sense that each industry has its own education system.
Rather than outsourcing education from schools, you have each industry which is overseen by an organization of it's various companies, who communicate ideas in and around that organization. That organization then communicates the findings, and innovations in each company under it with other industry organizations.
As well each organization educates from a top down approach the workers in that industry, and help new talent find their strengths, weaknesses, assess goals, and where is best for them to position themselves within their industry, it if more effective in another, to help them transition to that industry.
This would help to remove the lag that tends to crop up with educational institutions who are always catching up with industries, and gives a much stronger support for the overall community, since the organizations are investing in the growth of each employee, who are in turn being paid to work and learn, which again provides more value for the company.
This progress can then be tracked virtually through an employee virtual profile, which would also have access to an educational library. This library could work similarly to how ad companies get their information to display products, where the inquiries and subjects that person studies can bring up other related subjects to diversify their knowledge, which could then steer them to other parts of that industry.
All of this, skills, and knowledge can be assessed virtually and confirmed through the education department for certifications which can then boost that workers wage automatically, with certain skills and knowledges being transferred. A conversion rate may be needed for transferring between industries
This of course builds off the lifetime cellphone idea I've come up with seperately. Wherein each person has one phone which acts essentially as an I.d. and is up to date on medical information, legal information, skills and knowledge, etc, which gives an individual a readout for progress, areas of improvement, and can track legal statuses.
Each phones unique i.p. represents that individual, and acts with security features to monitor health, help track crime, etc.
@@JonathanMarcybig brother
@@bigzigtv706 -.- still hiding from him?
When payout ratio being high is not necessarily bad for the economy. These funds will again reach companies through capital markets and higher will be financial markets activity. Net impact om GDP should be positive
Thin is not guaranteed, while dividends acts like transfers, the impact of lower investment hurts technology advanced from reduced capital availability, given investments are inherently risky and the future uncertain, use cases could be non-existent when technology is being developed, one can say that relying on capital market to fund long term high risk projects is overestimating human capacity and foresight, this is where the state kicks in, to act as the most patient investor. That said, dividends or interest paid out to investors has no guarantee to land back to profitable projects with net positive social benefits or contributions, some if not most gets directed into speculative bubble, like real estate or cryptocurrency, the most retarded versions of non-productive waste of capital. While one can argue that bubbles exist due to lack of profitable real investment, one can also argue this should not be the reason for malinvestment that can tank the whole economy when bubble implode
This is why I'm looking at engineering stuff now. It fills in a part of society economics neglects.
Manufacturing is only a part of the equation.
The humanity of the operators is ignored. Their muscles ache. Their minds are trapped. They are literally slaves for rent. They are told what to do, what not to do, how to do it, when to do it, questioned about every action, reprimanded, and eventually discarded when value can no longer be extracted.
@@SamuraiKage-iv3ow important too
Engineering and microeconomics do go hand-in-hand. Especially industrial engineering.
Did the model T have a New South Wales number plate? Taree is in NSW!
The stock market issue for short term profits has been resolved with voting shares and non-voting shares. Whats called A shares and B shares.
Also, Amazon is an example of an American company that invested in the long term and also any biotech company.
Whatever dude
@@SamuraiKage-iv3ow 😂
Nobody who hasn't invested time and effort in production, should gain these massive profits, it's not fair. I'm no communist, but money making that much more money is a cancer to society.
Nobody should sit around and get hundreds of times what a worker gets (who actually produces the product, puts in the time, effort & education needed), and increase his capital that much just because he/she invested in a company, it's sick
Agreed! Even asking for a "fair share" of the profits will get you labelled a commie. Its why the facist anarco-capitalist love division of labor: low education require, because they can replace you easier. Youer only doing one small in the manufacturing/supply chain.
The US produces 7million cars a year and you didn't mention the timeframe of 70,000 cars produced by Japan. Is it per year also or per month or daily?
What is it called, when company issues one new share from much more older shares ? 🤔😱🤔
Here Roy makes the institutionalist case.
gamestop is a company for the people. DRS GME
Ha-Joon Chang has put together a great lecture series, but his marks on Karl Marx seem to be a little off quite often.
Excited, what did Chang get wrong about Marx?
Nah.
One of his doctoral advisors at Cambridge, Robert Rowthorn, is a highly regarded Marxian economist in England. So he is biased.
@@samuelskillern7365 This is a logical fallacy. Person A has (as one) teacher Person B therefore A must be B? You may well be right but all you've demonstrated here is 'jumping to conclusions.' Never mind that, please show us precisely where this 'bias' lies. Explain also how this 'bias' pertains to some 'norm.' Good luck with that.
@@hinteregions Not a logical fallacy. It's a statement of fact. If you're mentored by someone, you're more than likely will be influenced by them.
Not everyone gets to watch their moms cooking 🍳 :(
I love all the keyboard economists in these comments…..
This seems like something of an oversimplification. During this period, corporate debt has grown, so despite returning all of the profits to share holders, US corporations have not been short on capital. While many companies are wracked by efforts to maintain predictable and large short term earnings, other companies manage to go for years or decades based on businesses that make no apparent profit but continue to have stock appreciation. It must be really challenging for companies in the physical economy to compete with the asset bubble economy and the market distortion in China.
No, Anglo-American companies are actually going into debt to pay shareholders. If that is not a sign that companies are starved of revenue, I don't know what is. Capital expenditures cannot be carried out on plant and equipment if doing so dings your balance sheet so hard that your next round of share buybacks is unfinanceable. And it's not like banks are more willing to lend these days either, especially given the 2008 crash. The point is that this style of corporate governance is destroying otherwise productive companies.
What you call market distortion in China is actually Keynesian economic planning. The state finances investment in plant and equipment, invests in productivity growth, and also serves as a lender of last resort if the company needs debt but cannot get a loan from the banks.
And I would dispute your claim that companies in the West are "challenged" by producing physical goods. In point of fact a lot of the profits nowadays for "physical goods" companies like GE or GM come not from commodity production, but capital gains from financialisation. Effectively using their capital to say, lend out money for cars, or rent out gas turbines. Effectively some of Western "industry" is now also turning into what banks also do. So it's a consequence of this kind of governance that deindustrialisation has happened. It is not merely that production moves overseas. It is that _actually making stuff_ is less profitable than engaging in financial games.
If you have shareholders breathing down your neck for more and growing profits year on year, when the CEO looks upon a balance sheet and sees that a car factory rakes in only around 100 million but car loans rake in 1 billion, that car factory is going to close down.
Well yes of course it is. Our lecturer is trying to make the excruciatingly difficult theory and maths of economics accessible to laymen, like me and you.
Ah, Aerospace, all engineers are created equal. Well that is false. Yes R&D. goes down the drain.
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I think he is spreading more of Chinese interests .
Why? He is South Korean.
He isn't Chinese,
LOL think some more.