Economics 2.0

THE MEANING OF SOCIAL ORDER

IF there is dumb, there’s dumber; smart, smarter; thievery, plunder; good, saint; plain Jane, invisible; pretty, beauty; etc.

The point is that we can use these gradations to better understand economics.

When you do things for status, that’s social order driving the economy.

But what kind of good is status? It’s not rival, because you can’t eat it; but it’s exclusive. A club good?

Citizenship is a club good. So is formal education. So is the opinion of your peers. We strive for and shed these things, depending.

And that makes the economy, micro or macro, somewhat unpredictable. Yet, understandable.

Perhaps status is an informal club good, akin to Groucho’s inexistent club. And as an informal club good, status is like fiat money, valuable only on the prevailing whim of a society that confers that value.

But unlike fiat money, status can’t just be printed. There is no central bank that can create status.

This kind of thinking leads us nowhere, doesn’t it? Still, better to know that we’re not anywhere, than to pretend we’ve arrived.

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