Re: [OPE] Reply to critics

On 29 September 2010 15:09, Jurriaan Bendien <adsl675281@telfort.nl> wrote:

>
> But I see that as a problem for your theory, since an F-22 Raptor is a
> commodity just like any other, built out of all kinds of other commodities.
> Why should the same products sold and used to make a civilian plane count
> as
> unproductive if they are used to make a military plane?
>
>

Upon re-reading this I noted another misunderstanding: those the production
of components, e.g. radar system, that enter into both a Boeing 767 and an
F-22 are *productive*, because the civilian air plane is a component of air
travel which enters the real wage vector.

If w is the real wage vector and A is the production matrix, then the
production of the non-zero elements of the vector:

c = (I - A)^-1 w

are the productive activities of the economy. Hence the quote above is a
misunderstanding.

//Dave Z

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Received on Thu Sep 30 10:20:43 2010