How to Pass Examinations in Economics - 經濟

Now I come to a question that has the full flavor of the Keynesian theory:


7. Neglecting the acceleration effects, public investment directed to

useless projects enriches the country. (Answer: T)*8


Since I have not read this chapter of Tarshis' book, I do not know his

precise explanation. No doubt it is very similar to mine: governments are so

foolish that they are more likely to do good when they don't try than when

they do. This reminds me that an economist named Sir Roy Harrod resently wrote

a pamphlet in which he argued that a country (named England) was getting

impoverished beacuse there was too much useful public investment. Oddly enough,

Harrod (who wrote the offical life of Keynes) claims that Keynes would agree

with him!


Lesson 8: Not Everybody understands Keynesian Economics.



Fianlly, I want to emphaisize how important it is for the student to keep

his wits about him:


4. Farmers suffer as much in depression as do wage earners. (Answer: T －

but really F)*9


Thw wrong answer was given in the appendix, I am sure, to see if the

student had been lulled into a state of uncritical receptiveness. It stands to

reason that farmers do not suffer as much as do wage earners. For one thing,

there aren't as many farmers. For another thing, it is not very probable that

farmers suffer exactly as much as wage earners.


Lesson 9: Nobody Knows the Suffering That Farmers (And Students) Do.




*8: Ibid., p.115. It also enriches the city.


*9: Ibid., p.88.

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