Psychology Dictionary of ArgumentsHome
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| Geographical factors: Geographical factors refer to natural elements shaping a region's characteristics, including terrain, climate, soil, and water sources. These factors influence human activities, settlement patterns, agriculture, and economic development. See also Economic development, Developing countries. _____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
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Economic Theories on Geographical Factors - Dictionary of Arguments
Rothbard III 819 Geographic factors/Economic theories/Rothbard: Rothbard: The purchasing power of money will (…) tend to remain equal in all places where the money is used, whether or not national boundaries happen to intervene. >Geographical factors/Rothbard. Economic theoriesVsRothbard: Some people contend that, on the contrary, there do exist permanent differences in the purchasing power of money from place to place. For example, they point to the fact that prices for food in restaurants are higher in New York City than in Peoria. Quality of life: For most people, however, New York has certain definite advantages over Peoria. It has a vastly wider range of goods and services available to the consumer, including theaters, concerts, colleges, high-quality jewelry and clothing, and stockbrokerage houses. There is a great difference between the commodity "restaurant service in New York" and the commodity "restaurant service in Peoria." The former allows the purchaser to remain in New York and to enjoy its various advantages. Thus, the two are distinct goods, and the fact that the price of restaurant service is greater in New York signifies that the preponderance of individuals on the market value the former more highly and consider it a commodity of higher quality.(1) Transport/RothbardVs: Costs of transport, however, do introduce a qualification into this analysis. Suppose that the PPM in Detroit is slightly higher than in Rochester. We would expect gold to flow from Rochester to Detroit, spending relatively more on goods in the latter place, until the PPM's (purchasing power of the monetary unit) are equalized. If, however, the PPM in Detroit is higher by an amount smaller than the transport cost of shipping the gold from Rochester, then relative PPM's have a leeway to differ within the zone of shipping costs of gold. It would then be too expensive to ship gold to Detroit to take advantage of the higher PPM. The interspatial PPM's may vary in either direction within this cost-of-transport margin.(2) PPM: Many critics allege that the PPM cannot be uniform throughout the world because some goods are not transferable from one locale to another. Times Square or Niagara Falls, for example, cannot be transferred from one region to another; they are specific to their locale. Therefore, it is alleged, the equalization process can take place only for those goods which "enter into interregional trade"; it does not apply to the general PPM. Rothbard III 820 RothbardVs: Plausible as it seems, this objection is completely fallacious. a) In the firstpPlace, disparate goods like Times Square and other main streets are different goods, so that there is no reason to expect them to have the same price. b) Secondly, so long as one commodity can be traded, the PPM can be equalized. The composition of the PPM may well be changed, but this does not refute the fact of equalization. The process of equalization can be deduced from the fact of human action, even though (…) the PPM cannot be measured, since its composition does not remain the same. Stores/real estates/locations: Finally, since any good can be traded, what is there to prevent, for example, Oshkosh capital from buying a building on Times Square? The Oshkosh capitalists need not literally transport a good back to Oshkosh in order to buy it and make money from their investment. Rothbard: Every good, then, "enters into interregional trade"; no distinction between "domestic" and "interregional" (or "international") goods can be made. Putrchasing power: Thus, suppose the PPM is higher in Oshkosh than in New York. New Yorkers tend to buy more in Oshkosh, and Oshkoshians will buy less in New York. This does not only mean that New York will buy more Oshkosh wheat, or that Oshkosh will buy less New York clothing. It also means that New Yorkers will invest in real estate or theaters in Oshkosh, while Oshkoshians will sell some of their New York holdings. >Clearing/Rothbard. 1. For an appreciation of Mises’ achievement in clarifying this problem, see Wu, An Outline of International Price Theories, pp. 127, 232-34. 2. (…) interlocal clearing can greatly narrow these limits._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Economic Theories Rothbard II Murray N. Rothbard Classical Economics. An Austrian Perspective on the History of Economic Thought. Cheltenham, UK: Edward Elgar Publishing. Cheltenham 1995 Rothbard III Murray N. Rothbard Man, Economy and State with Power and Market. Study Edition Auburn, Alabama 1962, 1970, 2009 Rothbard IV Murray N. Rothbard The Essential von Mises Auburn, Alabama 1988 Rothbard V Murray N. Rothbard Power and Market: Government and the Economy Kansas City 1977 |
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> Counter arguments in relation to Geographical Factors
