Rekindling looking back has been three lives

Chapter 25 I understand, applause

While Swensen was still remorseful, Zeng Huixian looked at Wu Chuzhi's still slightly green face and added, "Xiao Wu, it seems that you have studied the broken window theory very thoroughly, so you might as well explain it in detail so that more people can understand it." Even my classmates can understand."

She paused, hesitated, and then continued, "In this way... it will also prevent these students from being bewitched when they take up jobs in the future, especially positions in management institutions.

I think, you have delved into this theory so deeply, you should understand what I mean. "

After all, she took a deep look at Wu Chuzhi.

Wu Chuzhi was silent for a moment, then nodded.

Then he took a deep breath and spoke calmly, carefully and carefully.

"Keynesian thought...or 'school' is more accurate, the reason why they put forward the 'broken window theory' of the 19th century from the pile of old papers actually has its purpose.

Through the paradox of a bakery, it is derived to the question of how to guide the economic recovery.

The Keynesian school believes that there are two ways for a country to create wealth. One is to rely on advanced productivity, that is, rely on technological advantages to improve social labor efficiency, thereby promoting economic development.

Another way is to rely on the "broken window theory" to maintain economic growth.When a country fails to have a technological advantage, it is bound to adopt the "broken window theory" to maintain the economy.

Then, combined with the background and history of the emergence of the Keynesian School, can any students tell me what are the main means of breaking windows at the national level? "

Wu Chuzhi's sudden question made the students startled. Although they thought it was strange, seeing that Professor Zeng was also listening carefully, they all started to think.

Kong Ziqian raised his hand. Although he is sometimes a little silly, his grades before entering university are still good.

When Wu Chuzhi mentioned history, as a liberal arts student, he immediately reacted.

Under Wu Chuzhi's gesture, Confucius stood up and said, "Keynesian thought was born in the 20s, during the economic crisis period of the 'Great Depression' that spread to the whole world, and the economies of various countries were hit hard.

The main coping methods can be roughly summarized as follows:
1. Improve the participation of management agencies in the economy;
2. Strengthen the national characteristics of the economy in the form of tariffs;
3. Some countries have unanimously moved towards the road of external force expansion..."

Confucius suddenly stopped talking, and looked at Wu Chuzhi on the stage in disbelief.

Wu Chuzhi smiled slightly and gave him a positive look.

This kid's emotional intelligence is a bit weak, but his mind is actually quite flexible.

Confucius took a deep breath and stammered, "Broken windows at the national level refer to wars..."

The students in the classroom stared wide-eyed, and then began to question one after another.

"Impossible! You don't want to say that the Keynesian school's way of dealing with crises is war, do you? Isn't this what they do when they are young?"

"Wu Chuzhi, are you crazy? How could the two different ways of coping at that time be the same thought?"

……

But when they saw Professor Zeng encouraging Wu Chuzhi with a smile on his face, they unconsciously lowered their voices.

Wu Chuzhi stretched out his hand and pressed it in the air, "Do you remember what Teacher Xiaoye said before?
The Keynesian school believes that when supply and demand are roughly the same, as long as the owner of the item suffers a loss, in order to make up for this loss, there will be a new demand for the commodity, and this demand gap can bring about an increase in supply and rebalance supply and demand.

This sentence is not obvious enough because what we see in the translation is not the whole picture.

Interested students can refer to the original text of "The General Theory of Employment, Interest and Money" written by Keynes in the library.

Keynes himself has such a sentence in the book, 'If we can't think of a better way, then building pyramids, earthquakes and even wars can also play a role in increasing wealth'. "

Everyone in the audience was shocked by this sentence, and also by Wu Chuzhi.

Unexpectedly, the king of skipping classes would read the original text, which made them unacceptable.

Zeng Huixian nodded and opened her eyes for Wu Chuzhi, "Xiao Wu is right, there is such a passage in the book."

Wu Chuzhi smiled and continued, "Kevins School is very pure, solving the economic crisis is the goal, and everything else is optional.

Going back to the three fallacies I mentioned earlier, I will now describe them in detail.

One of the "broken windows fallacy" is that it ignores the economic activities caused by this "broken window", which is at the cost of wasting social resources and loss of life and property.Combining this with the above example, you should be able to understand it, so I won't repeat it.

The second "broken window fallacy" lies in blindly optimistic speculation about the increased consumption behavior after the broken window.

The window is broken, what should I do?
Earlier, we said that the bakery owner opted for a repair replacement.

What if we don't fix it?That would lead to theft happening.

This is related to the "broken window theory" of criminal psychology that I talked about when Teacher Ye punished me to stand.

Unfortunately, Teacher Ye didn't let me finish. "

After that, he gave Ye Xiaomi a playful look.

For some reason, he just wanted to tease her.

As for Ye Xiaomi, who was sitting under the stage, her lungs were blown out.

shameless!

The expression on your face when you stood up was obviously distracted!
But at this time, facing Wu Chuzhi in such a supernatural state, she felt a little inexplicable.

She angrily showed two small canine teeth towards Wu Chuzhi.

Zeng Huixian, who was beside her, had a panoramic view of her lover's expression, was dazed for a moment, and then smiled with her lips pursed.

Chu Jian, who had a smile on his face on the other side, turned livid at some point.

Wu Chuzhi, who finished applying the eye drops to Ye Xiaomi, accepted it as soon as it was good, and continued to talk, "The bakery owner is now facing a dilemma. Repair the window, and then he will lose the money to buy gifts for his girlfriend.

If you buy a gift for your girlfriend, there is a high probability that you will be patronized by thieves because of the broken window.

We assume here that he chose love, and after spending a pleasant night, he had to face the empty scene in the store the next day.

After being stolen, the owner of the bakery, whose income is not very rich, may not buy clothes for the next two or three months, and will also reduce romantic spending with his girlfriend.

And because he is worried about encountering thieves again, he will reduce the number of times he goes out. On the contrary, his consumption expenditure will decrease, and the consumption of the entire community will decrease.

If there are multiple bakery owners, the rampant thieves have caused great fear and uneasiness to people's psychology, and the management agency can only increase its strength and invest more financial resources to rectify the law and order. to building infrastructure.

You see, this is the second fallacy I mentioned. The Keynesian school secretly changed the concept here, forcing the bakery owner to only repair it, leading to the economic chain behind, so that people ignore that other choices of the bakery owner may lead to economic consequences. "

Seeing the students in the audience start sketching in their notebooks, Wu Chuzhi slowed down his speech, "If we expand the scope of the broken window theory at this time, you can easily understand why Keynes would say that building a pyramid , disasters and even wars.

What he said about building pyramids is to strengthen national projects, such as the way that the beautiful country said during the economic crisis.

Withstanding a disaster, this depends on whether God gives face or not, and it cannot be controlled by humans, so we can only follow the trend.

As for war? "

Wu Chuzhi spread his hands and shrugged his shoulders, "In fact, everyone has seen it. At that time, some people thought that war would bring benefits to the country.

Because the war will destroy some social resources, it will increase the demand of the society at this time, so they embarked on the road of external expansion.

The principle is actually the same, because the war creates people's needs, and this demand itself is just a transfer of other needs that people originally had to these places.

It is actually not beneficial to the whole society to transfer the needs that people could not get in the years during the war to the years after the war.

Wars and disasters will reduce production capacity and people's ability to pay, which in turn will reduce aggregate demand.

In addition, some people think that wars and disasters will destroy some old equipment and facilities, so that we can use newer technologies to improve production.

There are actually problems with this. If this point of view is correct, then there is no need for wars and disasters at all. These old equipment and facilities can be replaced every year to increase productivity.

In fact, these equipment and facilities have an optimal depreciation rate. Only when the net value is close to the salvage value and a bomb blows it up at this time is it really beneficial to the parties concerned. "

After all, he stopped, giving everyone a buffer time, and also giving himself a break to drink water.

He walked back to his seat and took a sip from the water bottle before returning to the podium.

At this time, Ye Xiaomi was a little discouraged.

What the hell, my podium!
Wu Chuzhi tapped on the blackboard, pointing to the first two sentences he wrote down, "Broken windows did not cause new net expenditures, but only diverted expenditures from other places.

Broken windows didn't create new activity, it just created different activity. "

Then, holding the podium, he said, "People just saw the event that happened, but they didn't see the event that would have happened."

After that, he smiled, "I didn't say this sentence, it was said by Mr. Bastiat, the original proposer of the broken window theory.

I always think that Mr. Bastiat didn't summarize the 'Broken Window Theory' back then because he had actually seen the loopholes.

The fallacy of broken windows appears repeatedly in the process of economic development in many forms, such as the fallacy of job calculation, the fallacy of national development and the fallacy of workers' employment, which are actually variants of the fallacy of broken windows.

Job counting fallacy: Take the beautiful country as an example, in the past they used 90% of the people to grow food, but now they only need 3% of the people.Can you say that their society is deteriorating, economically declining because of the loss of agricultural jobs?

On the contrary, the beautiful country is still the world's largest economic power, so the real progress comes from the reduction of low-value jobs caused by technological progress.

Fallacy of national development: Some countries took a big detour and did some very wrong things, but looking back, fortunately they did these wrong things, and this country developed later.For example, Hans Meow went through World War II, and the foot pot chicken suffered a few truth bombs, so it developed rapidly afterwards.

In fact, if these two countries did not suffer from those traumas, their capital accumulation would be richer and their economic foundations would be better.

The fallacy of workers' employment: If the elderly do not retire early and give up their jobs, young people will not have jobs.Machines will replace workers, and if machines are too good, workers will have no jobs to do.

So the machines are too advanced and the elderly work too long, which is not a good thing for social development.

So if we use spoons instead of machines to dig the soil, and everyone retires 20 years earlier, will society as a whole be richer or poorer?

The reason why many people fail to recognize these fallacies is that it is often difficult for us to tell what kind of new production those saved production resources can be used for, and how much wealth they can generate.

We are only deriving from these fallacies, so that we have these illusions.

Therefore, if you have the opportunity to enter the management organization, when you implement a decision or project in the future, you may wish to think more about these fallacies.

A lot of analysis of the impact of these decisions on us, so that we can better use the resources that belong to us and future generations. "

There was no sound in the classroom, and it was silent for a long time.

What Wu Chuzhi said was very reasonable, but it had a huge impact on the students.

This is incompatible with the education they receive.

After understanding the essence of the Keynesian school of thought, they not only want to ask, what is the next choice for the Keynesian school of thought when the path of investment-driven economic growth fails?
The answer is chilling.

Wu Chuzhi almost made it clear that the Keynesian school of thought was not suitable for the economic development of Huaguo, and even vaguely pointed out that it was not suitable for Huaguo's peaceful rise.

However, this did not prevent them from giving Wu Chuzhi warm applause after they understood.

Whether it's right or wrong, it's obvious that Wu Chuzhi's ability to say what he said couldn't be done by memorizing the scriptures or memorizing them by rote.

They understand that Wu Chuzhi's thinking and accomplishments in economics have far surpassed those of his peers.

At this time, Wu Chuzhi's image in their hearts suddenly grew.

Maybe, others don't like class, just thinking more?
Perhaps, their college life is the real sense of desolation and decadence.

This made them a little embarrassed, and they couldn't help but start to reflect, what is the purpose of studying in university?
score?

Or is it real, your own knowledge?

Wu Chuzhi didn't know what the students in the audience were thinking, and at this moment he was content with the thrill of being so pretentious.

Or, become a teacher in college in the future?

In fact, he quite enjoyed the feeling of standing on stage like this.

"Hehe, as a teacher, you can't afford to support a family. Think about your future father-in-law's family position." Swensen in his mind broke his thoughts decisively.

……

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