Size and Capitalism

[Roman Clone]

Before you even groan, don't, this isn't meant to bash (or praise) capitalism.

I want your opinion on this: Do you think the a country with a smaller population would do better or more worse than a country with a larger population? Feel free to use examples from our world to support our argument. (Both countries mentioned before use capitalism.)


And if I dare get some one quoting me and bashing me when I haven't given an opinion with this post, only a question, there are going to be some serious facepalms.

Debate away.

[Viking Prince]

Before you even groan, don't, this isn't meant to bash (or praise) capitalism.

I want your opinion on this: Do you think the a country with a smaller population would do better or more worse than a country with a larger population? Feel free to use examples from our world to support our argument. (Both countries mentioned before use capitalism.)


And if I dare get some one quoting me and bashing me when I haven't given an opinion with this post, only a question, there are going to be some serious facepalms.

Debate away.

OK, I quoted you.

The question is not quite right. You should be asking how individuals do better or worse. With free trade and capital ownership, the question of a borders diminishes.

The US has done very well with a large population because quite a bit of the history involved tariffs and other anti-free trade devices. Also wars. In other words, the size of the effective market certainly helps individuals to prosper. Americans would have performed even better with freer trade.

So now you can contribute to the debate. I try to never bash anyway! I cannot promise agreement however.

[Roman Clone]

OK, I quoted you.

The question is not quite right. You should be asking how individuals do better or worse. With free trade and capital ownership, the question of a borders diminishes.

I meant population, not the physical size.

[Viking Prince]

I meant population, not the physical size.

So do I.

[Kiljan Arslan]

Yeah how about provide some sources for that? Because theres alot of evidince that suggest that Americas tarrifs in fact were one of the reasons America rose.

[sparty]

As I understand it the US cannot impose more protectionist restrictions on trade both because of our currency and trade dependency on our biggest trade partner: China.

[Viking Prince]

As I understand it the US cannot impose more protectionist restrictions on trade both because of our currency and trade dependency on our biggest trade partner: China.

This is not tied together. Importing goods and exporting bonds is a promise to export in the future. If the holders of the bonds do not believe this is true, the value of the bonds will decline. Or the valuation of currency will shift. Or assets/investments in this country will be sold to liquidate the bonds.

We are not dependant on trade with China anymore than they are with us. Trade is simply a series of private transactions where each party perceives a personal gain.

Also, it is natural for the developing economy to accumulate a visable trade surplus with a developed economy.

The chinese are also rebalancing their portfolio by buying less US bonds and more bonds from other nations. The transfer should mean lower exports by China to the US in the future or at least more China exports to other nations.

This is not a problem. Nor is this a potential threat. Unless the parties do crazy things. That makes discussion of the issue difficult until after the crazy acts occur. Otherwise we are delving into conspiracy theory and other deadends.

[Viking Prince]

Yeah how about provide some sources for that? Because theres alot of evidince that suggest that Americas tarrifs in fact were one of the reasons America rose.

Traveling. I can do so upon my return home. Briefly, any protection raises the price for consumers. This makes for an inefficient allocation of resources. I will grant you that Americans became better off under tariffs (as I suggested in my post), but that does not mean this was because of tariffs.

A simply example: Country A wants to encourage steel production, so instptutes a tariff on imported steel (and products containing such) so that local companies prices are better.

Two things happen -- competitive forces for innovation are reduced and consumers have less resources to spend on other items.

Now let us suppose Country A discovers a real cheap source of raw materials so that the tariffs are not necessary. Exports explode and the country grows. To some it looks like tariffs worked by allowing, but the reality is not so.

[Kiljan Arslan]

Well we could put trade restrictions but the chinese do owe over half a trillion in American debt. (Thankyou Bush!)

[Kiljan Arslan]

How do you know innovation is reduced if their isn't a monopoly on the steel industry then I very much doubt it will in any way be reduced. The thing that causes innovation to drop is subsidies, not tariffs because tariffs affect all foreign goods and help all parts of a nations industry whilest subsidies only go to the larger parts of an industry letting them slack off.

[Viking Prince]

How do you know innovation is reduced if their isn't a monopoly on the steel industry then I very much doubt it will in any way be reduced. The thing that causes innovation to drop is subsidies, not tariffs because tariffs affect all foreign goods and help all parts of a nations industry whilest subsidies only go to the larger parts of an industry letting them slack off.

Innovation is driven by competitors amd the need to find advantage. The advantage may be new product, lower costs,etc. Tariffs reduce competition and thus must to some degree reduce the need for innovation.

A tariff works the same as a subsidy by raising the market clearing price. If this were not so, the tariff could be lifted and no change in imports would occur. The domestic producers receive a higher price for the product than without the tariff. There are fewer competitors in the market and thus must to some degreee reduce the need for innovation.

So both tariffs and subsidies should reduce innovation.

[bushbush]

of course the bigger then better. What are the two most basic elements for an economy? land and capital.

land = all kinds of resources (kinda weird to call it only land, but that's the technical term)

capital = money, tech, human capital and such.

the more of those generally mean more production. More production means greater share of goods for everyone thus better living standard.

[Viking Prince]

of course the bigger then better. What are the two most basic elements for an economy? land and capital.

land = all kinds of resources (kinda weird to call it only land, but that's the technical term)

capital = money, tech, human capital and such.

the more of those generally mean more production. More production means greater share of goods for everyone thus better living standard.

Correct -- Note that there is no need to state anything aboput a nation's size in this explanation. The process merely needs access and not possession. Look at Switzerland or any other m=small developed country.

[Kiljan Arslan]

oh wait so if we have a probelm that a nation that has shown itself to be hostile were delving into conspiracy theory? Wow nice try at guilt by association.

[Roman Clone]

Well when you said "borders" I thought you meant physical size. Sorry.

[Kiljan Arslan]

Got anything other then rhetoric Viking? Lets see some actualy proof to your claims.

[Viking Prince]

Got anything other then rhetoric Viking? Lets see some actualy proof to your claims.

Open up any intro micro nook. It is all in there. Want more? I will pull a reading list. Are you interested or was this a rhetorical flourish. If interested, I will be glad to provide.

Edit: I am speaking about size of market -- perhaps you are speaking about scale of operation. This may be why we are speaking past each other.

[bushbush]

Edit: I am speaking about size of market -- perhaps you are speaking about scale of operation. This may be why we are speaking past each other.

I think it goes both ways.

If a nation has gigantic number of resources and labor and capital, plus a gigantic market, it is obviously in a very good situation in the global economy because this country, relatively speaking, could rely less upon trading with others. (not to say that economic protectionism worked, it didn't work to solve the great depression).

for your example of switzerland, i believe they have a gigantic amount of capital (that's tech, money, training, managing method, and etc) per capita relatively speaking to nations like China and India. That somewhat makes up its smaller number in labor or other resources. So when we say size, we can include the size of capital as one area.

[Viking Prince]

I think it goes both ways.

If a nation has gigantic number of resources and labor and capital, plus a gigantic market, it is obviously in a very good situation in the global economy because this country, relatively speaking, could rely less upon trading with others. (not to say that economic protectionism worked, it didn't work to solve the great depression).

for your example of switzerland, i believe they have a gigantic amount of capital (that's tech, money, training, managing method, and etc) per capita relatively speaking to nations like China and India. That somewhat makes up its smaller number in labor or other resources. So when we say size, we can include the size of capital as one area.

Correct and also a good point -- I am just trying to narrow the question that Kiljan is working on -- I certainly do not want to research and answer a point that he has not raised.

[Kiljan Arslan]

all you have done is say it "must happen" yet provide no actual proof of your statements. If it is true why did America flourish under protectionism, whilst its counterpart England at the same time floundered under free trade?