Economics

Economics

When people mention economics, they usually think about the profit, the consumption, and other economic policies which directly affect their daily life. Henry Hazlitt (1979) believed that, this is the persistent tendency of men to see only the immediate effects of a given policy, or its effects only on a special group, and to neglect to inquire what the long-run effects of that policy will be not only on that special group but on all groups. In public economic, not only should people focus on the instant effect of the acts or policies to the single group, but pay more attention to the long term effect to all groups in the society.

    The fetish of full employment

 In the tenth chapter of the book, the author told us that the economic goal of every country is to gain the maximum profit consuming the minimum, which is the same as that of individuals. As we know, the development of the mode of production, based on full employment, is one of the most essential element to promote the development of the whole economics. Full employment means that unemployment is reduce to short intervals of standing by, with the certainly that very soon one will be wanted in one’s old job again or will be wanted in a new job that is within one’s power (Beveridge, 1960). And Henry gave the example about the reason of needy of China and India, which is ought to backward production facilities not to full employment. He also argued that the final proposal of the development is to have fullest production which is more difficult to achieve than full employment.

In my opinion, I agree with the point that fullest production, related to productivity and output, and full employment stick together and support each other. Full employment is beneficial to enlarge the national capital and to improve the level of people’s daily life. In China, there are approximately 1.3 billion people containing 910 million labor force, which is four times more than American. Nevertheless, not all of the labor force can get a job opportunity, which means unemployment exits. Unemployment is one of the factor giving rise to social instability. People goes to work and earn wages to buy what they need, relating to the supplying and remanding market of the country. Therefore, to maintain such a large labor population connecting with the market, the developing country like China who has the large population has to concentrate on how to provide more job opportunity at first rather than fullest production, ensuring most people are able to live a good life using the salaries they earned. Only earn the wages, can people satisfy their demand. Although the author believed that the final goal of the national development supposed to be fullest production, I think it depends on the step of the national development. To the developed countries who is at the further step of national development, it is essential to realize that it is important to take advantage of employment to achieve the fullest production goal. On the other hand, to developing country like China and India, ensure and encourage the employment step by step is better than promote fullest production at one- step pattern.