[lbo-talk] language query

Julio Huato juliohuato at gmail.com
Tue Feb 6 19:10:48 PST 2007


Doug wrote:


> Yeah, but there's Mexico (per capita income, PPP, $10,209; life
> expectancy, 75 years), and Bolivia ($2,856, 65), and Haiti ($1,846,
> 52). Next to Haiti, Mexico's rich.

That happens whenever one converts a continuous variable into a discrete binary one. One doesn't have to... Or one can use a discrete variable with as many values as there are natural numbers (countably infinite, as statisticians call them). The World Bank uses four or five categories, no? But we're looking for economy of language here.

My point is that the key variable is (human and physical) wealth, "assets" -- or in the old terminology consumption goods, means of production (including "natural" resources), a healthy, educated, talented, and happy labor force. With some measure of wealth, all countries can be ranked W_1 > W_2 > ... > W_n. But if for some purposes, one has to draw a line somewhere, it should be okay to say:
>From here up it's "rich" and the rest are "poor."

I thought the controversy would be on whether wealth is the crucial variable. I'd argue it is. Wealth is pretty fungible. It's potential or effective productive force. With markets, including labor markets, wealth becomes money and capital ipso facto -- direct economic power. And given time to reconvert, it can be turned into sex appeal, political power, military might, etc. -- any extra-economic application or form of power one can think of.



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