Most likely in the summer of 1970,
Jerry Emanuelson published a proof showing that if two people work at two tasks
at relatively different rates, they can trade their labor for mutual gain, even
if one of them does both tasks better than the other. His work appeared in The
Libertarian Connection #13. It
is known to economists as Comparative Advantage, and it was suggested by Adam
Smith, but argued forcefully later (1817) by David Ricardo. However, the formal
statement was not known outside of academic economics; and it was, of course,
compelling to libertarians. So, Jerry worked out several pages of algebraic
inequalities for our benefit. As of this posting, it remains a lost work.
It is specifically inequality that makes Comparative Advantage be true. The governing assumption is not that A is better than B, but that A and B produce what they trade at different comparative costs within their own economies. They have different opportunity costs. In order to maintain autarky (to produce all of their own goods themselves) they each must give up the opportunity to produce more of what they do better. Even if Nation A or Person A is better at producing both items, it is still in the interests of both A and B to specialize and exchange, rather than attempting to produce everything for themselves.
Ricardo’s Law of Comparative Advantage also became famous. Not only do libertarians know all about it …
… but even Paul Krugman accepts it:
The Libertarian Connection was modeled on the science fiction fanzine. For your subscription, you were allowed to contribute two pages of content. The publishers collated the submissions, copied them, and distributed them to the subscribers. The magazine came out every six weeks. Originally, it was mimeographed. Contributors sent their works on stencils. The LC eventually went to photo-offset.
Issue 1 here: http://fair-use.org/libertarian-connection/1969/02/10/from-the-publishers-of-libertarian-connection
Issue 2 here: http://fair-use.org/libertarian-connection/issue/2
Issue 3 here: http://fair-use.org/libertarian-connection/issue/3
My comments about LC for Rebirth
of Reason here: http://rebirthofreason.com/Forum/GeneralForum/1211.shtml
In those early days, libertarianism was a very small set of
people. Dale Haviland, a professional printer, produced the A is A Directory in 1971, which listed
just about everyone who wrote an article for a libertarian magazine. He also
produced a directory of those publications. That is what made Jerry
Emanuelson’s proof important: it influenced a small group of people who
themselves went on to become the Libertarian Party, Reason magazine, the Cato Institute, and much else.
You can find the original treatise On
The Principles of Political Economy and Taxation (London: John Murray, Albemarle-Street), by David Ricardo, 1817 (third
edition, 1821) as a text file here:
You can find the algebraic statements for Comparative
Advantage in Wikipedia https://en.wikipedia.org/wiki/Comparative_advantage The bibliography of sources for that
article includes these:
· MacDougall, G. D. A. (1951). “British and
American exports: A study suggested by the theory of comparative costs. Part
I.”. The Economic Journal. 61 (244).
pp. 697–724.
· MacDougall, G. D. A. (1952). “British and
American exports: A study suggested by the theory of comparative costs. Part
II.”. The Economic Journal. 62 (247).
pp. 487–521.
· Stern, Robert M. (1962). “British and American
productivity and comparative costs in international trade”. Oxford Economic Papers. pp. 275–296.
· Balassa, Bela. (1963). “An empirical
demonstration of classical comparative cost theory”. The Review of Economics and Statistics. pp. 231–238.
· Chipman, John S. (1965). “A Survey of the Theory
of International Trade: Part 1, The Classical Theory”. Econometrica 33 (3): 477–519. Section 1.8, p.509.
The theory and its algebra were known, but not widely known
to those with great interest in promoting free trade.
For much more see, for instance, “Ancient Greece and Wine” in
Wikipedia
https://en.wikipedia.org/wiki/Ancient_Greece_and_wine
https://en.wikipedia.org/wiki/Ancient_Greece_and_wine
But see, also, modern Greece and wine here:
Erwin S. “Filthy Pierre” Strauss bought The Libertarian Connection from Skye d'Aureous and Natalee Hall, and soon changed
its masthead to The Connection. Filthy is active in science fiction
fandom. As neither Jerry nor I can find our archives, I wrote to him to see
what his terms and conditions may be.
Jerry Emanuelson's homepage is called Future Science here: http://www.futurescience.com/
Jerry Emanuelson's homepage is called Future Science here: http://www.futurescience.com/
ALSO ON NECESSARY FACTS
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