tag:blogger.com,1999:blog-3260529726656118434.post4163111041072896848..comments2023-10-06T00:52:04.371-07:00Comments on news from the zona: alan blinder, the vivien sisters, and meRoger Gathmannhttp://www.blogger.com/profile/11257400843748041639noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-3260529726656118434.post-423847673951906242009-04-17T20:02:00.000-07:002009-04-17T20:02:00.000-07:00"At least two billion \people make do on a couple ..."At least two billion \people make do on a couple [of] dollars a day".<br /><br />I know this is only meant as illustration, poetically as it were, but it is factually inaccurate and tends to perpetuate a common misconception.<br /><br />The thing is, even in those countries with their lower cost of living, it is physically impossible to live <I>on</I> a couple of dollars a day, and in fact that is not what is happening, any more than a teenager getting that as pocket money is living on it. Rather, those people are in <I>developing</I> economies in which there are non-cash activities as well as cash ones.<br /><br />People who have plentiful subsistence resources but very little cash income are not poor; they have the Micawber result happiness. This case applied in past times but not today. Today, there are people with small subsistence resources who desperately need a top up cash income, on the principle of the Micawber equation, so they can and do price themselves into supplementary work at low cash wages with result misery. But they are not living <I>on</I> those wages, and there is another even worse transitional subcase: people who have been deprived of their access to subsistence resources and only survive briefly unless and until something better or far worse turns up. These people at the margins are continually recruited from the better off others who are bidding wages down, while those people last. That means that it is only transitional for individuals in that situation, as the marginal group can persist indefinitely while people flow through it.<br /><br />So, people in those countries do indeed need more resources - but simply supplying cash would work mainly to move food from mouth to mouth, if prices rose without corresponding new resources coming on stream and - more importantly - becoming accessible to those who once had adequate subsistence resources but now have ever less. We can get much relevant insight by looking at our own history of Irish Evictions, Scottish Highland Clearances and English Enclosures of the Commons in the light of Nassau Senior's 19th century work on wages.P.M.Lawrencehttp://users.beagle.com.au/peterlnoreply@blogger.com