Subject: Re: Open letter to those who believe in a right to free software
From: "Karsten M. Self" <kmself@ix.netcom.com>
Date: Thu, 28 Oct 1999 22:38:53 -0700

Russell Nelson wrote:
> 
> Karsten M. Self writes:
>  > I'm going to jump in on Stephen's side of the debate.  Economics can
>  > explain behavior of people when that behavior is based on rational
>  > preferences.  The preferences don't have to be monetary, though they
>  > often are, at least in part.
> 
> Economics has nothing to do with money, and everything to do with
> value.  People spend a portion of their life energy to get money, and
> they spend that money to get things they want.  Economists study the
> way that people expend their life energy to get the things they value.
> Money is just an fungible analog for value -- you could put that value
> in terms of bananas, tobacco, memory chips, or ice cubes.  The fact
> that people use money instead of the latter is due to the technical
> characteristics of money.

What you've just said is that you shouldn't confuse the measurement (or
exchange) units with the values they are measuring.  No argument there.

Where money is useful in economics is that it helps quantify things. 
Dollars, euros, or yen allow comparing apples and oranges.  At least in
terms of market-assessed value.

Someone asked me off-list if I were suggesting that I was suggesting
that a free software user's actions were irrational.  The response is
no, in two parts (and yes, I got the joke):

 - There can be rational, non-monetary motivators.
 - Economics studies markets.  Individual behavior falls under
psychology.

...I'll risk shooting from the hip again and say that, of the two
underlying functions in economics, production and utility, the actual
mechanisms of how utility works in individuals isn't well understood. 
It's heavily based on psychology and other fields.  It's usually glossed
over in introductory and intermediate texts.  The *implications* of the
utility function, and its effects on the market, are generally fairly
well understood.  But the critical voices here do have a point when they
say that economists don't know what makes people tick.  However, we do
know *how* they tick, in aggregate.

Corrections from Stephen again anticipated.

-- 
Karsten M. Self (kmself@ix.netcom.com)
    What part of "Gestalt" don't you understand?

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