Our feelings are correlated with income and sometimes we don't care about the money spent on seemingly trivial things because we actually enjoy the experience and pleasure.
Before Industrial Revolution: farms pre-machinenary and produced low
How to estimate old time's people's income?
(1)Estimate:estimate how much they produced based on technology at that time and times the price
(2)Critical thinking:We know what a poor country looks like,so we can reason that if people survived in old time,the living standard is similar to today's poor people's.
Fecundity doesn't promise a country's prosperity.(Singapore & African countries)
Production possibility frontier(PPF):graph that shows all the combinations of goods and services that can be produced if all of the society's resources are used efficiently.
Singapore succeeds because of good management and trade while Africa suffers from waste of resources and riots.
Before Industrial Revolution,national income increased, but income per person didn't because serf gave money to lords or noble man,who thus gained wealth and built elephant projects with improved technology.So technology itself can't enhance the economy.
First application of broken window fallacy in the class:People often pay great attention to certain achievement of a certain country and think that the country has a great development,ignoring the living standard of its people. (Opportunity cost)
No previous men can imagine level of wealth and productive potential achieved by modern world
(1)Rising income (2)Living standard (3)Medical treatment (4)Communication and transportation
It seems that modern people have no servants like old kings,but actually we have millions of workers providing us goods and services.
Difference: (1)They also serve others and can be served.(2)They serve not due to mercy,but because of profit.(Fed Ex)
The problem of being poor is that any difficulty can be lethal due to a lack of wealth and security.
Life expectancy is one of the best measures of social progress because it is influenced by income,living standards,health care,safety,nutrition,environmental protection and crime.
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