That is the question asked by John Cochrane in this recent draft essay ( non-PDF version here ), in response to a current Journal of Financial Perspectives report by Robin Greenwood and David Scharfstein. Both need to be necessary reading for any introductory finance class. There is so much in these essays that one weblog post could not hope to adequately cover the subject, so don’t anticipate this to be anything resembling a complete response.
In a monetary economy, it is in everyone’s private interest to try to get an individual else to hold non-interest-bearing money and reserves. But a person has to hold it all, so all of these efforts should basically cancel out. All of us commit numerous hours per year in this effort, and we employ thousands of talented and highly-educated people to assist us. These person-hours are just thrown away, wasted on a process that need to not have to be performed at all.
My Aunt Penny’s explorations were not overtly politicised, but often carried an underlying belief in the validity of traditional practices otherwise marginalised by the cold rationalism of industrial society. Her position of power, and the reality that she took Zulu beliefs seriously, meant other Zulu diviners started to turn to her for assist. By default she would find herself standing up for their rights to maintain sacred water spaces over the rights of, for instance, home developers. These are the seeds of activist anthropology.
I am blessed in that my son has just this week really gotten the hang of potty instruction, and it is just in time because I had no thought how we have been going to afford diapers. So, for people with young youngsters, anything as basic as diapers can be a blessing. We are entering a transition of how society perceives ownership. They existing model of organization success achieved by means of exploitation is unsustainable.
An additional crucial technique is marketing and advertising, since men and women typically have to be ‘taught’ that they want one thing. In the case of contactless payment on the London Underground, the Mayor of London, Barclaycard, Visa and the Evening Standard have formed an unholy alliance to market Penny for London , a thinly veiled front-group to encourage people to use the Barclaycard-run contactless payments system rather than those ancient Oyster cards. Sports stars like Jessica Ennis-Hill and Dan Carter have been co-opted into becoming the champions of automated finance. Signs have been popping up proclaiming ‘contactless is here’, as if it have been some thing that men and women had been supposed to be waiting for. These subtle hegemonic messages permeate every economic billboard in the city.