Finally! Economics that I can mentally grasp without the creation of a mind numbing migraine. However all of this doesn't help in understanding the credit crunch. The theories that are about to be discussed are either labelled as localised or national, by this I mean that the ones I have deemed localised do not seem to consider the nation as a whole, instead they seem more suitable for small populated areas, not necessarily urban, whereas the national are suitable to be adopted by all. Adam Smith it can be argued, who represented the classical economic branch, had some valid points such as economic success is determined by sun spots and trade, this makes sense as it infers production conditions and distribution play key roles, however this perspective seems like it is best suited locally, as individual areas conditions are only considered, and important factors like money are only considered tokens. This shows that only small scale things are considered, whereas John Maynard Keynes ideals seemed best suited nationally as it had principals that were not dictated by area, and could be controlled by all regardless of the poor or high trade channels in certain areas or high or low productivity. Keynes believed that money was good for the economy and that the market should not control the value of money; that its should be set by the government who effect it by spending money, thereby effecting interest rates.
Von Hyak on the other hand can be placed into another category it can be suggested that he falls into the more practical group, rather than the academic theorists, as his approach to economics was dominated by a form of area planning, for example if a road was to be built it would be considered how many people live in that area, therefore how many people may use it. This seems like a very good idea as it implies that economics should be interchangeable and adapt to suit all areas.
Upon researching this topic the names mentioned above seemed the architects of economics, however a name not mentioned in the lecture was Thomas Robert Malthus, who agreed with Keynes by claiming that in order to stimulate the economy and generate jobs money must be spent, if money is saved it will cause high unemployment. I just thought I would mention this as it seems like they are from similar schools of thought, and I felt the need to impart some wisdom before I finished this blog.
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This is a bit muddled up, but a fair stab at economic theory if you have never read any of it before. You should read at least some economics on a journalism degree (even a half journalism degree) since money is the main thing that peoiple think about all the time apart from sex so surprize surprize all the academic topics we have done this term have been either about money, sex or death which is basically eveything that is interesting it seems to me. But economics is the most interesting thing because it helps understand why people do whatever it is they do without any metaphysical nonsense. It is a non-sentimental way of looking at human behaviour and this I think very much fits with the mentality of journalists who are in fact the world's worst romantics in many cases but of course they cover that up in Freudian terms by being super cynical all the time.
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