[PEN-L:8302] Re: Bengali famine

[Brad De Long <delong@xxxxxxxxxxxxxxxxx>]

>Doug Orr:
>>I am not sure about India, but Ireland exported food throughout the
>>potatoe famine.  So you see Louis, it really is the free market at work.
>
>
>I'll tell you the truth. After answering DeLong on the Bengali famine, it
>dawned on me--particularly after reading Jim Devine's interesting
>follow-up--that I really wasn't sure about the point DeLong was trying to
>make. He is awfully good at what is called misdirection, kind of like the
>backcourt play of a good NBA point guard the NY Knicks need. Was he saying
>that the absence of markets or the presence of markets was the cause of the
>Bengal famine? I frankly don't have a clue.

Maybe you could actually read what I wrote. But probably not.

As I wrote:

	...the Walrasian equilibrium of a market economy
	maximizes a particular social welfare function: a
	weighted sum of individuals' utilities, where each
	individual's utility is weighted by the *inverse*
	of his or her marginal utility of income. If indirect
	utilities as a function of income are roughly
	logarithmic... [then] the market weights your well-being
	...in proportion to your income.... No income, a zero
	weight. That's how market economies generate things
	like the Bengal famine of 1942.


Brad DeLong


-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
"Now 'in the long run' this [way of summarizing the quantity theory of
money] is probably true.... But this long run is a misleading guide to
current affairs. **In the long run** we are all dead.  Economists set
themselves too easy, too useless a task if in tempestuous seasons they can
only tell us that when the storm is long past the ocean is flat again."

--J.M. Keynes
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
J. Bradford De Long; Professor of Economics, U.C. Berkeley;
Co-Editor, Journal of Economic Perspectives.
Dept. of Economics, U.C. Berkeley, #3880
Berkeley, CA 94720-3880
(510) 643-4027; (925) 283-2709 phones
(510) 642-6615; (925) 283-3897 faxes
http://econ161.berkeley.edu/
<delong@xxxxxxxxxxxxxxxxx>