Political Economy of Land Economics. The Ghosts of Natural Resource Economics Past Wednesday, January 18. Thomas Hobbes (1588-1679). Thomas Hobbes. Each of us is motivated to act in such ways as we believe will relieve our discomfort, preserve and promote our own well-being.
The Ghosts of Natural Resource Economics Past
Wednesday, January 18
This Contract of Society was the foundation of the Contract of Government, under which all political power is a trust for the benefit of the people, and the people themselves are at once the creators and beneficiaries of that trust. The State is based on a contract between ruler and subjects, who give him power only so that their own welfare is increased and their property protected in a way not possible in the State of Nature, where it may be taken away by unprincipled forces.
Returns to land ownership are unearned
Secure, individual ownership might lead to improvements
Q = f( L, K)
L = labor
K = capital
Wages – returns to labor
Profit – returns to capital
Rent – returns to land (natural capital)Adam Smith
The value of a product is determined by the amount of labor used to produce it.
Read Field Chapter 2, “Natural Resources and the Economy”