Honestly, I do not know much about economics, but after getting help from a economics major friend, I hope what I am going to say below will make sense. First of all, what I got from him is that Friedman's side, neoclassicism or neoliberalism, is like nature, it has its own way to regulate or to take care of itself. In short, it helps itself to balance, we believe. On the other hand, we have Keynesian side, in which we believe "it" will be balanced through the government's hand by fixing prices and so on, that I do not know much about. And here I am going to state that Keynesian is more real to me.
I think Keynesian is more real to me because I do not think that nature is able to take care of itself, at least to me, it is not good enough. I know this is just a metaphor, and indeed I am not sure if it can be applied to the economics market, but if really nature is capable of taking care of itself, I think it should not get worse but to stay at a point that it is balanced. You may argue that it is a matter of timing and that I have no clue. So I think nature does need help from us like economic market needs help from the government. Perhaps economic market does not want help from anyone, but it just need help. In addition to that, I think that if the government is the one who started it at the first place, like how it helped the agriculture business by using leftovers from the World War II, stated on page 41, it should know how and when to help and to regulate. Based on what we have read in The Omnivore's Dilemma and what I saw on the documentary Food Inc. it seems to me that corn is now in high demand and supply but the problem is not being taking care of, this may suggest that the idea of market is able to take care of itself perhaps is correct? And by saying that and seeing what we have been seeing and reading, I believe that Keynesian is more real to me, at least I can see the effects if it has done it.
I also found the WWII explanation on page 41 in Omnivore's Dilemma and the documentary on Food Inc. to support the Keynesian theory versus neoclassical or Neoliberalism. The WWII explanation on page 41 made it clear that the economy was controlled by government intervention and policies to favor the use of chemicals and fertilizers for agriculture. Food Inc. also offers an insightful look at how the food industry has been controlled by the self-interests of businesses and corporations through policies, regulations and especially cheap corn. Overall, this blog post points at what is truer, the Keynesian point of view.
ReplyDeleteWainok, I felt that you and I had very similar hesitant standpoints when entering this unit. And like we mentioned in class, it doesn't seem like we are the only ones who feel like this. I'm glad that you were able to talk to an economics major to get things sorted out and it seems like they had the same explanation for neoclassical as we did in class; that it would be the ideal situation, that the nature of the market would sort itself out eventually. Where the problem arises is asking do we really have that much time to sit back and wait for the market to fluctuate? Which is why I also agree with you, that Keynesian is truer!
ReplyDeleteWainok, I think we ALL need an Econ major friend to deal with this stuff--which is why it makes it so easy to use as a political tool.
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