What are Economists good for, Episode 0

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The short answer is that their main strength is an activity that is denoted with a single word: buy-sell-exchange. It practically means retail shops and banking. If groceries is looked at, then clearly the buy-sell-exchange activity is amiable, honorable, activity that clearly benefits everyone. The same with exchange of other, premanufactured(!!!), simple-to-use, goods like clothing, home appliances, etc. After all, a vacuum cleaner can be difficult to manufacture, but all that the end user must know about it is, how to empty it, how to plug it to a wall outlet and where the on-off button is. The economists are terrible at ALL OTHER FIELDS, regardless of the fact that they consider themselves to be Jacks of all trades or believe firmly that more detailed expertise is really not that necessary for running other types of businesses.

Just like it's not possible to make most Christians believe that God does not exist, it is not possible to make most economists, specially the MBA-s, believe that

markup = price - cost

and that the cost can be properly evaluated ONLY(!!!) by having detailed expertise in the field. What to invest in? Long-term costs versus short-term costs?

Please note that I'm not speaking about the quality of goods, because total crap can be successfully sold in IT-services, specially software development. I believe that the more complex the area, the easier it is to sell crap, because people can not be experts in everything and for that reason all of us have to trust at least someone, which usually is the sales person. Can You assess the reliability of the engines of a plane, when You board it? Can You assess the reliability of the breaks of a train or a bus, when You board it?

If people get hit by cars, because the cars and people were physically at the same location, on the road, then that is taken as part of life, not as sloppy civil engineering. After all, properly protected sidewalks do cost more than making the road a bit wider. The same thing with software development and other IT-services. Writing less faulty software takes smarter, more expensive, developers and more developer hours than having some poor souls, who do not even know, what they're missing, slam together some sloppy thing that "has" all the functionality. Quotes are due to the fact that sloppy systems can corrupt data, become terribly slow. The issues that are related to the poor security of amateur-ish systems, classify under data corruption property.

Historically speaking, poor quality of products is not a show stopper, unless some extremely knowledgeable market like teams of scientists is targeted. Scientists and proper developers at universities and top-notch development teams will dump low quality products fast and, figuratively speaking, will slam the door HARD after the sales person, who offered them the low quality products, but that kind of markets are small enough to be dismissed by economists, so statistically speaking, those markets can be ignored. Top-notch developers, including scientists, are the ones, who move the humanity further from ancient apes, but they're a minority and therefore can be ignored and bullied by majority of economists, specially the MBA's. Middle-age and ancient kings were happy with what they've got and that's all, what matters, or at least that's all, what matters to the kings and MBA types.

Last, but not least, there is a big difference between bureaucrats(MBA-s), and people, who are the majority owners of the business that they run. Bureaucrats are happy, if rules are followed, even if the rules drive the business to a ditch. Majority owners, on the other hand, are a totally different breed. When doing sales, the owners can be negotiated with, whereas the bureaucrats are a hopeless bunch and a total waste of time.



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