Wednesday, December 03, 2008



That is from today's Ming Pao, more here.

The fallacy inherent in the legislators' plea to stop importing talents from outside of HK is that they see the economy as a fixed-size pie. If some people get a large share of the pie, then others inevitably would get smaller slices. Zero-sum thinking.

That metaphor, market as a fixed-sized pie, is wrong.

A better metaphor for the market is that it is an exchange nexus. As more people participate in the market nexus, the extent of divison of labor could be further extended, the more productive the economy would become. A larger pie for everybody. And that, the enlargement and the extension of the market through increasing the number of market participants, is one of the fundamental drivers of the wealth of nations.

BTW, don't blame the legislators to be such idiots. YOU voted them in, remember? Disclosure: I DID NOT VOTE AND I WILL NOT FOR THE MANY ELECTIONS TO COME.

1 comment:


They also don't understand, they can restrict people coming in but can't restrict firms going out.