Tuesday, December 04, 2007

When young means old and when efficiency isn't fair

Sukardi Rinakit in his yet another difficult article in Kompas. Like Rizal in Cafe Salemba, I had no idea what he was trying to say.

For one, his definition of "young" now is totally different with his friend Fadjroel Rachman's -- Sukardi says everyone is welcome to be young, Fadjroel thinks you should be young to be considered young.

OK, that's really not important, sorry.

But now that I'm quite curious with all this fuss, I read their statement here. Here's what's interesting. They complained that
[T]he current economic system is such that one's [additional, I suppose] wealth can only be obtained at the cost of somebody else's.
Well, that's what we call efficiency, my friends. You want to optimize and make use of everything possible. Is it going to be fair? Not necessarily. That's why you have compensation schemes. That's why you recognize binding constraints.

Economists in that group, if any, should really tell the others about The First Fundamental Theorem of Welfare Economics and, most importantly, The Second one.

4 comments:

Arya Gaduh said...

Now, that's why I asked you to put up his name before. See? He does this often... (and more to come, I'm sure ;-))

Aco said...

You're damn right Arya. Well I have added him to my list :-)

ariapn said...

I don't think they meant it about efficiency bro. They're referring to the false belief that economic transaction is a zero sum game, that the economy is a fixed-size pie. That for someone to benefit, another has to suffer.

Is Sunardi a regular Kompas contributor? Even ignoring his opinion, I couldn't quite understand his literary style.

Anymatters said...

Young means we start to accumulate wealth with an aggressive investment, not to discourage individual prosperity with a progressive movement.