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Originally Posted by Adept Havelock
Rain Man clearly holds the Keynesian chair in Pizza Economics at Chiefsplanet U. |
I'd say his post was more Austrian, freemarket.
A Keynesian version would be more like: Central bank floods market with extra dollars. Pizza lovers everywhere think they are richer than they actually are, creating an artificially stimulated demand for more pizza. Lots of excess pizza is baked. There is lots of waste,including the extra lonely and single slices of pizza...which appear in pizza parlors everywhere thus seeming less special.
Sooner or later pizza prices climb to deal with the increased demand and ultimately leads to a lower demand making last leftover pieces of pizza appearing more special due to costs. Hence the boom and bust cycles that is automatically built into the Keynesian model but which no one ascribes to being caused by the central bank which is connected to govt debt and deficits from the outset.
Pizza must be freed from this central command type of economy which would regulate the "specialness" of lonely, single,last and leftover slices of pizza.
