Summations Only

Without hindsight you don't know how much something is worth.The unsung work of some poorly paid publicly funded research scientist might one day prove absolutely vital to a technology that transforms the world and increases the productivity and living standards across the globe for future generations.Or some of the highest paid people in the world may not be nearly so clever as they have persuaded everybody (including themselves) that they are. Instead of being the "wealth creators" they believe themselves to be it may turn out that their financial exploits in fact do considerable damage to people's living standards and end up destroying more wealth than they could ever hope to create.Oh wait a minute....hasn't that happened recently?People get paid what they can persuade someone to pay them. How much they are actually worth only time will ultimately tell.

If you are going to define the worth of something as how much it costs then (by definition) things are worth what you pay for them. But that's just circular and silly. But by your definition it is perfectly possible for things which raise living standards and create wealth to have no worth. How much (to use a very EvC example) is the theory of evolution worth? What is the worth of a vaccination? How much is the discovery of the Higgs Boson worth?Innovation is the aim of a capitalist economy. It's what creates wealth and drives things forwards. The economic "worth" of an idea or an activity is how much wealth it generates in terms of improved living standards etc.Yes - It's almost impossible to quantify. But that doesn't mean it isn't there or that it can be ignored. But the sort of "worth" I am talking about indisputably does have a huge economic effect. Human activities that result in increased wealth. Innovation. Entrepreneurism. These things are what drive capitalism. They are the stated aim of economic policies.So how can they not be part of economics? My gran would have said something like "This boy knows the price of everything and the value of nothing".Do you think "price", "value" and "worth" are all the same thing?Edited by Straggler, : No reason given.

But what is the point of that definition when considering things like the worth of publicly funded scientific research in terms of the wealth it creates?Research. Knowledge. Ideas. Innovation. Technological progress.These are the things that increase productivity. These are the things that drive the creation of new wealth in a capitalist (or indeed any other) economy.If your definition of "worth" is unable to cope with the fact that these things have considerable value in terms of increasing wealth simply because they cannot be easily priced then it is your definition of "worth" that is inadequate and which needs to change. Not mine. What am I supposed to reconsider? Am I supposed to deny the fact that innovation drives wealth creation? Deny this because it doesn't meet your criteria of being price-quantifiable?If so - No. But what constitutes "most fit" in an economy? It is very arguably the one that has the best environment to foster wealth creation. The best educated workforce. The healthiest workforce. The best transport infrastructure. The best telecommunications infrastructure. A society that people trust to be just and lawful. A society where people can take entrepreneurial risks that may or may not work out because there is a safety net that means failure won't result in destitution. Etc. etc.Wealth creation is a collective endeavour. To deny this is to misunderstand the complex and often unquantifiable factors involved.

If you want to define "worth" in such a way that many of the most significant contributing factors to wealth creation have no worth then we can't stop you doing that.But if you are then going to apply this definition to the question of how wealth is created and who it is that we can attribute wealth creation to - You are going to get some very silly results.For reasons that should be obvious.

Given that this thread follows hot on the heels of the Trickle Down Economics - Does It Work? thread and that Percy seems to be using this thread in order to justify his conclusions about who is responsible for wealth creation in that one......Isn't "worth to the economy" what is important in terms of wealth creation in the economy? If it is bullshit it is important bullshit. Because it is the basis upon which policy decisions which affect all our lives are made.Edited by Straggler, : No reason given.

If we are talking about wealth creation and who to attribute it to then Percy's definition of "worth" in this thread is simply inadequate to deal with that question. Because it can only assign worth to that which is readily quantifiable. And whilst we all seem to agree that things like research, innovation, technological progress and increased productivity are essential components of wealth creation we can't quantify their effect in the way his rather narrow definition of "worth" demands.If on the other hand Percy is, in this thread, simply talking about some sort of bookkeeping notion of "worth" that is wholly quantifiable then I'm not sure what his point is. Actually I put quite a lot of value in it. But I also put value in the idea. And I also put considerable value in the investment we all make in the infrastructure that allows the combination of the idea and the investment to flourish and create wealth.In the other thread we saw that it is the wealthiest who have reaped nearly all of the rewards of increased productivity over the last 30 years. My point there was simply that if they are receiving more wealth than they are responsible for creating then wealth is trickling up rather than down. Edited by Straggler, : No reason given.

It is the difference between the wealth that would exist without the unquantifiable in question (e.g. the development of a particular technology or idea) and the wealth that exists with it. In order to accurately quantify this we need duplicate identical economies on which we can run randomised double blind trials in order to eliminate other factors to find out the exact extent to which the thing in question has contributed to wealth creation.Which is obviously impossible in practise. You can accept that something (e.g the development of a particular technology or idea) has contributed significantly to wealth creation without being able to quantify exactly how much can't you? The charts in question show that nearly all of the wealth gains over the last 30 years have gone to the richest 5% of the population in a way that they didn't before certain so called "trickle-down" policies were implemented.The only way to reconcile the idea that this 5% have not received more wealth than they have created over the last 30 years is to conclude that the ideas, innovation and share of national infrastructure that we attribute to the other 95% of the population is worth very little.Is that realistic? I say not. The infrastructure in question is what makes the US (or UK) a first world country as opposed to a developing nation. There is a reason new technological developments and investments take place in developed nations. It is the shared legacy of wealth of the nation that developing nations lack. It is the infrastructure of the nation.It is the existence of this collective infrastructure that makes the successful origin, development and investment of an idea even possible. Educated, healthy workforce. People willing able to take the sort of risks that are essential to capitalistic entrepreneurism because there is a welfare system safety net which means failure doesn't result in destitution. The rule of law as a result of a functional justice system. Energy infrastructure. Communications infrastructure. Water infrastructure. Transport infrastructure. All these things are essential to wealth creation. And they are not the exclusive right of the top 5%.How can we quantify what contribution this past investment and infrastructure makes to the wealth creation of a nation? I have absolutely no idea. But I would estimate it as absolutely immense.. Wouldn't you? To quantify it we would have to remove all of the past public investment in such infrastructure in one of our hypothetical duplicate economies and see whether the idea and investor combination was still able to flourish and create the same amount of wealth.Obviously we can't do this. But I put it to you that most ideas wouldn't even see the light of day without such past investment. Never mind be equally as successful at creating wealth as they have been with this infrastructure in place.I don't see how this immense contribution can just be ignored so that the top 5% currently investing can lay claim to nearly all wealth creation. It is impossible to quantify. But a lot.More than enough to dispute the idea that the top 5% alone can lay claim to nearly all wealth creation in the US over the last 30 years.

Because the top 5% wealthiest cannot realistically lay claim to all of the other unquantifiable factors that contribute to wealth creation.Previously we have had the following exchange: Unless you now consider these publicly funded but unquantifiable factors in wealth creation to be all but irrelevant you cannot attribute virtually all new wealth to the the top 5% can you?Edited by Straggler, : No reason given.

Can publicly funded scientific research contribute to wealth creation?Is it possible to quantify how much wealth creation a specific research project results in?

Just to be clear:Do you agree that the wealthiest have accumulated nearly all of the increased wealth over the last 30 years? The data clearly shows this doesn't it?Do you think that the wealthiest are responsible for creating nearly all of this increased wealth?If they are receiving more wealth than they are creating then wealth is trickling up, not down. Well if we "don't know" you can't claim that wealth is trickling down.

Could it have got there at all without the legacy of publicly funded infrastructure that we collectively own?If not it is difficult to see how one can justify the idea that the wealthiest 5% can lay claim to having created all this wealth to anything like the proportion of it that they have received.The legacy of national infrastructure is a key component of wealth creation. It isn't economically worthless in the way that your price=worth view dictates.

I asked: To which you asked about a free software example of your own. So I am going to mix our examples and use your example of free software but I am going to make this free software the result of publicly funded research as per my example. SCENARIO
So we have this freely available software that is the result of publicly funded research. It's very clever software and soon becomes very widespread. Everyone agrees that despite being strictly unquantifiable it has had an immense effect on the productivity of the workforce.Yet when the data on incomes becomes available it becomes clear that whilst productivity has increased 100% since the release of this software the average worker has received barely any increase in income at all.Meanwhile the incomes of the top 1% have shot through the roof since the release of this software.Given this scenario I would conclude that the wealthiest have received more wealth than they can claim responsibility for having created and that wealth has therefore trickled up.What would you conclude?Edited by Straggler, : No reason given.

Well the data I am referring to is our much cited graph from the other thread. Here is a link to it. Message 92Well if you do know please share your knowledge with me by answering my question. Have the wealthiest 5% of the population received more wealth than they have created over the last 30 years?If you have the numbers. Please share them with us.I expect the numbers required to answer this question in your reply.

If public investment (in an education programme for example) leads to increased productivity of course it contributes to GDP.GDP would be less without it. The fact you can't accurately quantify how much doesn't mean you ca ignore it's impact entirely in the way you are doing.

You seem determined to eliminate the publicly funded aspect of the scenario that is key to the question of who can claim responsibility for increased productivity. Why? If only the wealthiest are significantly benefiting from increases in productivity that are the result of public investment then they are receiving wealth that they are not creating.This is how "trickle up" occurs.