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Quotation of the Day…

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… is from pages 4-5 of Arnold Kling’s and Nick Schulz’s splendid 2009 book, From Poverty to Prosperity [2]:

Economics 1.0 is about scarcity.  To understand what we mean by that, consider that textbooks define economic as the study of the allocation of scarce resources among competing ends.  So if a society wants to produce more guns, then it will have less labor, land, and equipment with which to produce butter….

Economics 2.0 is about abundance, which arises from technical progress.  Maybe there’s no free lunch, as the saying goes; but we do not have to work nearly as hard to put food on the table as we used to.  Just two hundred years ago, over half of all Americans worked in agriculture.  Today, the figure is less than two percent.  Sixty years ago, a social studies teacher looking for a movie that would motivate students to sympathize with the plight of the unfortunate in America might have chosen “The Grapes of Wrath.”  Today, it would be “Supersize Me.”

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