Reflections on the Principles of Economics by College Students —— Marshall, the father of modern economics, is the most famous economist in modern Britain, the founder of neoclassical school and Cambridge school, and a professor of economics at Cambridge University. He was the most important figure in economics at the end of 19 and the beginning of the 20th century. He was born in England and graduated from Cambridge University 1865. After graduation, she taught in Cambridge for nine years and then went to Oxford University. 1885 returned to his alma mater to teach until 1905 retired. Such a great economist began to study mathematics, philosophy and political economy after entering the university, and was most interested in philosophy, but he finally chose economics as his major. The important reason for this decision is that Marshall visited the slums of Britain and could not forget the poverty and hunger he saw.
Some people say that the reason why every famous economic book is popular or has a milestone is mainly because it conforms to its special social background and economic state and meets the requirements of its own historical conditions. Adam. In his masterpiece The Wealth of Nations, Smith put forward a famous theory called The Wealth of Nations. Invisible hand? Principle, emphasizing capitalist free economy; Marshall inherited Smith's? Invisibility theory? Opposing the state government's intervention in the economy, he expounded the theories of supply and demand, abstinence and production cost in the Principles of Economics published in 1890, especially the marginal utility theory, which formed? Compromise theory system . In this book, he established static economics, and his economic theory was regarded as the continuation and development of British classical political economy. His book is regarded as an epoch-making work with Smith's The Wealth of Nations and Ricardo's Principles of Taxation. It became the most influential monograph at that time and the foundation of modern economics. For many years, it was regarded as the Bible of British economics. This economics book was published eight times in Marshall's life.
When I opened the book Principles, what attracted me most was the theory of production and consumption. What is production (labor)? Marshall's point of view is different. In his eyes, labor only changes the form or arrangement of matter to better satisfy people's desires. Carpenters make furniture as productive labor, and furniture dealers carry and place furniture in stores as productive labor, because although one object of labor is wood and the other is furniture, both of them make objects more useful than before, and both of them are essentially effective. So what is consumption? Consumption makes people? Desire is satisfied? . Contrary to production, consumption only disrupts the arrangement of substances and reduces or destroys their effectiveness, so it can also be called? Negative production? . People's desires are varied and endless.
But when it comes to single desire, there is a law of diminishing marginal utility. The reason is simple: a hungry person is sure to gobble up the bread he gets, but as his stomach is full, the taste of the bread is not as sweet as it was at first. When he can't sit still, if he is forced to eat another one, maybe he will hate innocent bread because of love. ? Consumer surplus? The theory is also very interesting. For example, a poor student (assuming he happens to be an economics major) entered a second-hand bookstall from a bookstore, which happened to be bidding for 20 yuan's good books. Although he wears it, it doesn't affect his reading. The poor student still has 65,438+00 yuan in his pocket, and he intends to have a quick look. Unexpectedly, the stall owner only needs 5 yuan, and then he bargains for 4 yuan. The student was overjoyed, because the 6 yuan saved was his consumption surplus.
In terms of economic policy, Marshall inherited Smith's tradition, advocated laissez-faire and opposed government intervention. But notice? Invisible hand? At the same time, Marshall also advocated that the government should play a role in promoting social welfare, narrowing the gap between the rich and the poor and reducing injustice. Marshall believes that poverty is the cause of human corruption. Therefore, it is the unshirkable responsibility of economists to study how to save poverty and improve social welfare. Marshall himself showed great concern about the poverty of the working class, often went deep into slums to understand the situation, and put forward specific measures such as taxing high-income people, giving relief to the poor, promoting education with government public expenditure, and improving living and medical conditions. These thoughts not only adapted to the situation of social class opposition in Britain at that time, but also became the similar theoretical basis of old and new welfare economics.
An important feature of Marshall Theory is that it has a fairly strict system. This book itself is a system and a basic framework for studying economics. This book is divided into six articles. The first preface. Economics is defined as an applied science that studies the relationship between wealth and human needs, and its purpose is to save poverty and improve welfare. The second chapter expounds the basic concepts of wealth, value, land, income, wages, land rent, interest, profit, quasi-land rent, production, consumption and labor. The third part, demand and its satisfaction, discusses the consumption theory. The fourth part, production factors, discusses the production theory. In this part, it tells the relationship among land, labor, capital and organization. The fifth part is the general relationship among demand, supply and value. The sixth chapter, national income distribution, discusses the distribution theory.
Marshall is the founder of local equilibrium analysis, that is, microeconomics. He studies the behavior of a single market, regardless of the influence between markets. He used the rising supply curve and the falling demand curve to analyze the impact of income and cost changes on prices. Thus, the equilibrium price theory is obtained, which is also the core of Marshall's economic theory. He believes that the market price is determined by the balance of power between supply and demand, and both play a role at the same time. The book Principles of Economics is the demonstration and extension of equilibrium price theory.
Another important contribution of Marshall is to establish the concept of elasticity and the formula for calculating elasticity. He analyzed the price elasticity of demand and supply, and found that the rise of demand in a short time will lead to a slight increase in price output, but more will lead to an increase in price. In a long period of time, the output is easy to expand or contract, and enterprises can enter or exit, making the long-term supply curve relatively flat. Therefore, Marshall concluded that in the short term, demand is the decisive factor affecting prices; In the long run, supply or production cost is the decisive factor affecting prices.
As far as methods are concerned, the analytical methods used by Marshall in the book Principles of Economics are also the synthesis of various economic schools. One is based on psychological analysis: Macher, like the subjective school, thinks that economics mainly studies the motives of human behavior. He believes that people's psychological opportunities strongly influence people's choice behavior, thus dominating people's economic activities. The second is to emphasize? Marginal increment? Points. Analysis. This is inspired by the school of mathematical economics. Marshall thinks? In the spiritual and material world, our observation of nature is less related to the total amount than to the increment? . Therefore, in Principles of Economics, he widely used the analysis method of marginal increment. The third is to emphasize? Local equilibrium? Analysis. Marshall explained the balance of economic power with the concept of the balance of action and reaction in physics. The equilibrium emphasized by Marshall is not a general equilibrium, but a local equilibrium. Under the partial equilibrium, Marshall studied a single producer or consumer, without considering the interaction and influence between manufacturers and consumers. The fourth is to emphasize? Static analysis? . In Principles of Economics, Marshall always puts his research object in an environment where economic relations and related factors remain unchanged. It is considered that under static conditions, the conditions of production, consumption, distribution and exchange are generally unchanged.
That's what the book says: Economics is the study of human behavior, one of which is to study the motives that affect human behavior, that is, why do people make such choices and activities? Marshall concluded that the most firm motivation for people to engage in various economic activities is to get wages and money. However, in life, there are many factors that cannot be measured by wages and money. For example, emotional factors cannot be directly measured by economics, but economics can be used to measure the gains and losses of love brought by emotion. Therefore, we can say that economics mainly studies the motivation or resistance of human activities. This is the starting point of economics. It is also an answer to the question of the origin of economics.
Principles of Economics, as the pioneering work of neoclassical school, has occupied a dominant position in western economics for a long time, and provided a theoretical framework with the same characteristics for various schools of western economics in the future. It can be said that no matter which school of contemporary economics, it can directly or indirectly, obviously or implicitly find its own origin from Marshall economics. Schumpeter, a famous German economist, wrote in an article commemorating the 50th anniversary of the publication of Principles of Economics. In a sense, Marshall's economics is out of date. . . . . However, in another sense, Marshall's enlightenment thought will never be out of date, and its influence will be long-lasting. ?
In fact, the economy is everywhere, and what is lacking is only the eyes of discovery and the inspiration of thinking. No matter how complicated the problem is, except for the side branch, it is only a category of choice. The world is not only the material framework we pay attention to, but also the pluralistic spiritual territory. We have been choosing, in the past, present and future. For a simple example, familiar cooking is also the result of choice. Since I chose to go to the canteen, I have to give up another choice: the supermarket. We unconsciously choose the benefits brought by these two behaviors, and the result will inevitably tend to choose the one with lower cost and best benefits.
It is reported that most passenger cars in China are overloaded and speeding, especially in some cities with relatively concentrated population. The regulatory authorities have also invested a lot of manpower, material resources and financial resources, but the effect is not good. Some people may say that this is a matter of quality, but at a deeper level, this is the result of a choice. First of all, minibuses attract a considerable number of passengers because they are convenient and affordable, but as an economic entity, how to maximize its benefits is obviously its most concerned issue. Low ticket price limits its profit space, and specific cost consumption makes it the key to increase cash flow. Secondly, for the regulatory authorities, there are two choices: one is to choose compliance, but the profit is low; One is to choose violations, but the profit is high. Although the second option has to pay the corresponding default price, under the current system, the probability is low, which means the opportunity cost is low, so the cost of the second option is low. However, some people may raise objections. If supervision is strengthened, can the opportunity cost be increased to a level greater than that of the first scheme? However, when they arrive here, they are faced with two choices. They can reduce the cost of default or the possibility of being determined as a default by bribing the regulatory authorities. The other is to rely on luck, which can save a considerable amount of non-operating expenses, but at the same time it also improves the uncertainty. Because uncertainty is also a kind of cost, in order to get more profits in a limited time (time is also an important cost), overloading, speeding and bribing relevant departments have become relatively better choices. After all, people are rational, and all actions are for the maximization of their own interests. If it is restricted only from the moral level, it will be so insufficient.
Thirdly, we should learn to look at the world from the perspective of price, and then infer people's choice behavior. This requires us to know how to distinguish costs. Cost includes not only price factors, but also uncertain risk price and information exchange cost. For example, the familiar snack street phenomenon is a choice behavior. Because the catering industry is strictly controlled and has its own limitations, it is difficult to transmit information, that is, the cost of rent-seeking is high. As a result, the capital is idle, resulting in great waste. However, if stores of the same grade are gathered together, they can exchange information and reduce the cost of sending price signals, which is a maximization for consumers and operators.
Third, pay attention to the economy, but also to abnormal phenomena, from which we can find the law. The world is full of miracles. We should not only extract laws from ordinary life, but also pay close attention to abnormal phenomena and discover the laws and new ideas of things. Abnormal phenomenon is sometimes a necessity and an optimized choice. For example, the rental price of a company in Hong Kong is lower than the market price, which has attracted attention from all sides. I can't help asking myself, is the company really thinking of the general public as he claims? However, from an economic point of view, because its low price attracts a large number of demanders, it is in a state of short supply, so we can choose households and consumers with good credit records, which reduces the supervision cost and allows the market to choose transactions. In this way, on the surface, the company is facing losses, but due to the reduction of uncertain costs, the profit rate has been greatly improved and a good corporate image has been established.
However, to really think like an economist, the most important thing is to cultivate your own economic consciousness, establish a relatively complete knowledge system, and be a conscientious person in life.
What is economics after reading Principles of College Students' Economics? In the preface, the article first defines economics as a discipline to study and deal with people's general life affairs in society. This definition is concise and to the point, which makes it clear that the object of economic research and treatment is the general affairs of human life and points out the basic position of economy in the general affairs of human beings. Accordingly, if a young man living in the present age doesn't even have some basic economic concepts and is completely ignorant, then to some extent, he can be equated with social illiteracy in the modern sense. Therefore, Man Kun said in the preface that this book is for the next generation to read as another contribution to the next generation.
An important feature of Principle is that it attaches great importance to the cultivation of readers' analytical ability, expounds the general steps of economic phenomenon analysis, and broadens readers' thinking through case analysis, arouses readers' interest in analyzing problems with practice, and then forms opinions from the analysis. exist
After analyzing the role of the government under the market failure, the book naturally goes step by step, focusing on the micro-organizational behavior of enterprises, and makes a detailed theoretical analysis of the relationship between supply and demand of enterprise products and enterprise management behavior under the four market environments of complete competition, monopoly, oligopoly and monopoly competition. This part of the content is very exciting, and the foreshadowing of the previous chapter has finally achieved fruitful results, which greatly satisfied the readers and benefited a lot.
In the construction of microeconomic theory system in the book, Man Kun obviously felt the need to explain the factor market, and then showed the readers an important principle of labor price: if the number of workers employed by a competitive and profitable enterprise reaches the point where the marginal output value of labor equals wages, then the marginal product curve is the labor demand curve. At this point, the microeconomics volume seems to have come to an end. But the author is obviously not satisfied with this. At the end of the book, some basic ideas of modern economy such as information asymmetry, consumption preference, political economy and behavior are thrown out, which provides a broader space for interested readers to study in the future.