The Instigator
Segnit
Pro (for)
Losing
3 Points
The Contender
Subutai
Con (against)
Winning
10 Points

Economics is Zero-Sum (1)

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Post Voting Period
The voting period for this debate has ended.
after 4 votes the winner is...
Subutai
Voting Style: Open Point System: 7 Point
Started: 5/19/2014 Category: Economics
Updated: 3 years ago Status: Post Voting Period
Viewed: 1,764 times Debate No: 54922
Debate Rounds (2)
Comments (12)
Votes (4)

 

Segnit

Pro

The Pro SideFor poor nations to gain wealth, the developed world has to become poorer.Think of economic resources as a pie chart made out of finite resources representing 100%. If for instance the rich world holds 70% of the pie chart then the only way the poor nations will get their share is if hey retake the portion held by the rich nations.In other words, in a "Zero-Sum economy" when the economic activity of all of the world's nations are combined, it would appear that economic wealth & prosperity is never created but merely transferred. Note: This is not a heavy duty debate so therefore feel free to debate any way that you like and bring in any argument at any time with any definition of your choosing. This is merely a trial run for a possible 2nd run in case there is something worth debating about.I have made the criteria for joining this debate impossible so as to allow for comments before anything.Round 1: AcceptanceRound 2: The Arguments
Subutai

Con

I accept. All I will do in this round is make a thesis, jut as my opponent has done. Over the past 500 years, all areas of the world have increased not only their economies, but each person's share of it too, and this continues to be true today. Wealth is not money, being more subjective and intangible, as the parties after a transaction have more wealth than they did before the transaction, even if they had not gained any net money. I look forward to my opponent's arguments.
Debate Round No. 1
Segnit

Pro

Economics as a zero-sum is a loose way of conveying the idea that in wealth and trade, one country’s economic gain from one deal is offset by an equivalent loss perhaps absorbed by millions of people in multiple countries.

The mechanism which drives my argument today is 1) change in currency value (inflation and deflation), 2) resources and 3) creativity.

1) Change in Currency Value: With inflation (or deflation) it’s important to remember that it does not strictly apply only to fiat currencies but to any kind of “currency” that can be used for the exchange of goods. For instance when the Spanish conquistadors brought with them large volumes of Native American gold and silver to Spain, inflation soared.
Without further evidence I would like to establish as fact that no matter the differences in definition of what constitutes an economy, that both inflation and deflation are an unavoidable form of indirect transfer of wealth. This holds true whether we’re talking about a “resource based” finite money (i.e. Gold, Silver, Oil, Water, BitCoin) or unlimited fiat currency.

With all of the above said, my inflation argument is as follows: Bolstering an economy by either printing fiat currency or by simply finding more gold from the ground necessarily facilitates the indirect, sometimes unpredictable transfer of wealth. This leakage is how developing nations can indirectly gain at the expense of developed nations or vice versa.

2) Resources: All major resources are finite (Land, Petrochemicals, Water, Rare Earth Minerals). Now each of these major resources probably deserves to have a separate case put forward but this is a quick and dirty exploratory debate and so I will only bring the example of "Land". As one country steals the land of another, the total sum of land doesn’t change in the equation.

This argument, if accepted, highlights the impracticality of bringing all nations to the same high standards (arable land per person and so on). And since I’m arguing that the economy is a zero-sum game, as long as it is not theoretically probable to have every country have similar high standards of wealth, I believe that gives weight to my side of the argument.

3) Creativity: Sure, creativity may be one way of creating wealth out of nothing. For instance imagine a country whose economy is entirely based on the export of books. And on paper it would appear that by creating demand for something which didn’t previously exist before (new IP), you’re in fact generating wealth and a win-win for all involved. But what is considered a win-win for the book exporting country, is a loss for businesses in all other countries where opportunity cost considerations results in the reduction in disposable income of consumers in a measurable way.

With this point I want to demonstrate that even though it’s true that all arts and entertainment (true for products and services as well) are competing globally; at the same time however, if a certain country’s – say for instance American – intellectual property as a whole starts to outperform in quality, value and sales metrics of any number of countries, then it makes sense that the limited disposable income of people from those 3rd countries would be reduced.

In other words, generating wealth by making something up by yourself from scratch still doesn’t make it immune from the fact that you will be creating a trade surplus for yourself, your family, your region, country, or continent. A surplus which isn’t created from an infinite pie but from a finite pie called disposable income, money or resource.


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Finally I would like to thank my competitor for taking part in this perhaps hastily put together debate, and for patiently waiting for three days while I get my poop (really debate.org, you're gonna censor s**t?) in order.

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Spain Inflation Source:
http://www.agbumds.org...
http://faculty.history.wisc.edu...

Subutai

Con

I would like to thank my opponent for this debate.

Since my opponent uses wealth as his measure, it is necessary to define wealth. Investopedia defines it as, "A measure of the value of all of the assets of worth owned by a person, community, company or country." So it doesn't just consider the price of the good, but also the subjective worth of it as well.[1]

Let's look at an example. Say a shoemaker and a weaver make an economic interaction. The former needs a shirt, the latter needs a pair of shoes. To the shoemaker, shoes are rather worthless, and to the weaver, shirts are rather worthless, but to the shoemaker, a shirt is valuable, and to the weaver, the shoes are valuable. So in the end, assuming the price of the goods exchanged is the same, no money has changed hands, but each person is wealthier because they traded something they don't need for something they do need. In other words, wealth is subjective to each person, and each person's subjective wealth must increase with each economic interaction.

In conclusion, as the Capitalism Institute argues, "Each individual values economic goods and services subjectively, that is, no economic good holds any intrinsic worth. The value of goods and services is based entirely on what individuals impute to that good or service." Wealth always increases to each person in rational economic interactions, meaning that such interactions are not zero-sum.[2]

But that is not the only thing. Income increases as well. This graph shows the increase in per capita GDP:


[3]

As can be seen, on average, each person's income has increased over the past 300 years. And it is not only the developed countries. All regions of the world have seen increased per capita GDP (with the exception of Russia, but that's a unique story, and they're bouncing back):


[4]

And this is inflation adjusted. The rich do not have to take from other to get rich. The wealth of the world, and on average, the individual, has increased, both subjectively and objectively. " The percentage of people living on less than $1 a day was 39% in 1970. Today it is 15-20% and falling. From the perspective of millennia, recent economic developments are just astounding."[4]

In conclusion, economic interactions are not zero-sum to the people doing them, as their subjective wealth increases. On top of this, the quantitative wealth of the individual has also increased on average. Economics is thus not a zero-sum game.

Sources

[1]: http://www.investopedia.com...
[2]: http://www.capitalisminstitute.org...
[3]: http://capitalism.aynrand.org...
[4]: http://www.krusekronicle.com...
Debate Round No. 2
12 comments have been posted on this debate. Showing 1 through 10 records.
Posted by Segnit 3 years ago
Segnit
That's just fine munkhtulgaod. You're officially 2nd in line :)

Just a reminder that this particular "debate" is just exploring the possibility of how to go about doing a multi-round debate on the matter. But if you're already way ahead of me and know exactly how it could work then you (anyone) could host a parallel debate with two different people debating the issue in tandem.

Perhaps that way the strongest arguments for either side would be quicker to bubble to the surface.
Posted by munkhtulgaod 3 years ago
munkhtulgaod
I understand. If he does not accept, may I be next in line please.
Posted by JackFritschy 3 years ago
JackFritschy
I would definitely want to debate this.
Posted by Segnit 3 years ago
Segnit
munkhtulgaod, I've already promised the slot to Subutai if he accepts.
Posted by munkhtulgaod 3 years ago
munkhtulgaod
I do not meet the criteria so I cannot accept but I would like to debate on the 'con' side. Is there a way to do this? I'm new to the site and am not very familiar with the process.
Posted by Segnit 3 years ago
Segnit
That's fine Subatai. I'll probably invite you to it a bit later today.

And Pfalcon1318. Which side would you have preferred to debate on?
Posted by Subutai 3 years ago
Subutai
Segnit, here's my suggestion: Do this debate in its current state, and if you feel it must be continued, we can do a second part of sorts with another debate.
Posted by Pfalcon1318 3 years ago
Pfalcon1318
I would like to do this as well. It seems like a pretty interesting debate topic.
Posted by Segnit 3 years ago
Segnit
But that's the thing, I'm struggling to find very strong arguments for Zero-sum. So I want to do is to just throw it out there in an amateur way and see if anything longer is worth pursuing.

Essentially this is going to be a one round event where arguments are gonna be put out for people to vote on.
Posted by Subutai 3 years ago
Subutai
I was actually going to ask that. Starting a debate with two rounds where the first is just a thesis statement of sorts is rather short. If you're up for it, we could do a more-round debate.
4 votes have been placed for this debate. Showing 1 through 4 records.
Vote Placed by iamanatheistandthisiswhy 3 years ago
iamanatheistandthisiswhy
SegnitSubutaiTied
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Reasons for voting decision: Short and interesting debate to whom points for arguments must clearly go to Con. If the average GDP of everyone in the world has increased, actually that the GDP has increased at all!, shows that Economics is impossible to be a zero sum game. An increase in wealth means something has been added and no zero-sum. Additionally, I am giving Con S&G points as Pro made more errors.
Vote Placed by Romanii 3 years ago
Romanii
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Reasons for voting decision: Pro does a pretty good job of showing that theoretically, different parts of the economy should balance each other out, thus causing it to be zero-sum as a whole. However, Con does an excellent job on his side of the debate. He first delivers a large blow to Pro's case by showing via logical reasoning that wealth cannot be accurately measured with numbers (which is all that Pro used), instead arguing that wealth is based more on subjective factors. With Pro's case partially refuted, he then goes on to cite reliable statistics (global per capita GDP growth) to show that the amount of wealth in the economy does, indeed grow substantially over time. Pro's case was very theoretical in nature, while Con's case was much more practical with its historical stats and all; thus, Con's case takes precedence in terms of factual accuracy, fully refuting Pro's arguments and negating the resolution. Very interesting read, even if it was a bit brief.
Vote Placed by whiteflame 3 years ago
whiteflame
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Reasons for voting decision: Well, I'm not sure why the voting period is 180 days, but I'll still put something down. It's an interesting case from Pro, and I certainly see where he's coming from. However, this is a big burden he's setting for himself - he has to prove that economics is essentially unchanging on the whole, and therefore that everything put in by one party is counterbalanced by another. I think he does a pretty good job of this. However, I'd need to see direct responses to Con's case, and as it's the last in the debate, I just have to decide if they upend that careful balance. Con tells me that wealth is subjective and therefore not a straight numbers game, but rather a game of worth to each individual. I buy that argument, since Pro's entire point relies on the premise that it is a numbers game, and Con successfully argues that back. I also buy the mathematical argument, though I can see where Pro might attack it in the next round. I'll be interested to see where Pro takes this in a longer debate.
Vote Placed by Cobo 3 years ago
Cobo
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Reasons for voting decision: Hmmm...I have to give it to Pro for 1 key reason, while the Con did address the main resolution he did not address of even mention the Pro's contentions/arguments. This was a big deciding factor due to these arguments actually supporting why the pro was saying. The pro was not without mistake though. The fact that the Pro did not set up any explicit rules and made this a 1 round debate was not very smart of the pro. But somehow pro, won on a 1 round debate.