I often wish I had been more focused when I graduated from High School. I wish I had a sense of the importance of college back then, and how interesting Economics was and its impact on the future. But hindsight is always 20-20, and I am where I am now because of God’s calling and circumstances. I am extremely happy with what I do, and love to see lives touched by education.
I have told many people that knowing what I know now I would have become an Economist. I love the topic and its many disciplines, but I really like the macro part of the area of study. I love how through the various schools of thought throughout history, we have a brilliant set of principles that we teach our students.
The terms Market, Supply and Demand, and Equilibrium reflect Microeconomic thought about how the firm competes. Aggregates, Growth, Business Cycles, and Unemployment are just a few of the topics we discuss in Macroeconomics. However, there have been many schools associated with the evolution of this discipline.
The Merchantilist and Physiocrat School helped to develop what we understand as Capitalism today and the circular flow of input and output. Adam Smith was considered part of the Classical School of Economics. He helped us understand the invisible hand and the division of labor. Thomas Malthus provided us with the idea of diminishing returns. Ricardo focused on rent and the distribution of income throughout our society. And what can be said about Marx and his economic thought?
There are many modern Economists that have impacted how we view Economics. Obviously in our current “spend until it hurts mentality” Keynes, which rhymes with brains, has had a huge impact on our economic understanding. Paul Krugman has done research on New Trade Theory, international economics, and the geographic concentration of wealth. He has also researched the impact of raising the minimum wage on employment.
The reason I have chosen this subject this morning because Gary Becker, an Economist from the Chicago School of Economics and protégé of Milton Friedman, died Saturday. “Gary Becker was a University of Chicago economist who expanded the field well beyond it traditional scope by establishing groundbreaking connections with sociology, criminology, and demographics.” I have not read anything by Becker before, but I plan to now. His focus was Human Behavior and economics. Becker was a believer in the free market, as am I.
I want to show you why I want to explore his writings. The WSJ this morning had an editorial exploring the “Wisdom of Gary Becker.” The first bit of wisdom is from an earlier WSJ article written by Becker and Kevin M. Murphy. “In the 19th century John Stuart Mill commented on the rapidity of economic recovery from national disasters and wars. He recognized that nations recover quickly as long as they retain their knowledge and skills, the prime engines of growth.” They wrote this as an encouragement to the United States because of 9/11. The United States had plenty of skill and as such would rise out of the ashes.
In 2005, Becker wrote another WSJ article entitled “Give Us Your Skilled Masses.” Becker argued for a liberalized immigration policy that would allow more skilled immigrants to move to the US. He also argued the Germany and Japan, both with an aging population would need more immigrants to pick up the slack. “Other countries, too, should liberalize their policies toward immigration of skilled workers. I particularly think of Japan and Germany, both countries that have a rapidly aging, and soon to be declining, populations that are not sympathetic to absorbing many immigrants.” He also argued that the US is still the destination of choice for skilled immigrants.
The last part of this article this morning mentioned the WSJ articles by Becker “Great Recession and Government Failure” and “Basically an Optimist.” Becker believed in the free market. However, he also believed that the great recession involved a market behaving badly. He also believed in the good fight. “But when Milton Friedman was starting out, people really believed a state-run economy was the most efficient way of promoting growth. Today nobody believes that, except in North Korea.”
These are just a few snippets from the writings of Gary Becker that has tweaked my interest. At least enough to want to see what he has to say. Oh my, it appears my summer is filling up with more books. I am soooooo looking forward to intellectual stimulation, and physical activity such as golf. But for now, RIP Gary Becker.
And that is my thought for the day!