Quote:
Originally Posted by finnbow
OK, but things that are seemingly abundant at one moment can become scarce (e.g., corn in the current drought). Does a sense of abundance drive policy? Sure (i.e.,the corn ethanol program). However, I'm still not sure that this makes "abundance" a coherent economic theory (if there even is such a thing).
|
Drought and natural disasters are not part of macroeconomic theories.
Abundance theory is much simpler. Suppose an economy needs four things, food, clothing, housing, and defense. A trivialized implementation of abundance theory would say that it doesn't matter if we remove all well paying jobs from the clothing and food sectors. After all the workers will invent work elsewhere.
What might happen in that scenario?