Basic Glossary
I use standard terms when I can find them, and coin new ones like “aims” and “ends”
when I can’t. But even standard ones are ambiguous. The vocabulary of economics is
not settled. Look up “capital” or “output” or “cash flow”, for example, in any
economic dictionary. It will show ranges of meanings, and appreciably different
ones from one dictionary to the next. I coped by defining as | went along, and would
have had to do the same even if this book were meant for economists only.
Otherwise the ambiguities would have left loopholes.
Definitions include:
Aims:
Capital:
Cash flow:
Ends: Exhaust: Flow:
Human capital:
Income:
Invested consumption:
Maximand rule:
Net transfer:
Chapter 3: Foundations
Intention to maximize the sum of current taste satisfactions plus gift, plus growth in means of future satisfactions and gift.
Means of aims; human plus physical capital; present value of expected cash flows.
Capital passed out, in transfer or exhaust, less capital inserted from outside.
Rationale of aims; biological imperative.
Termination of capital in taste satisfaction.
Any process measured in capital per unit time.
Present value of skill sets; capital whose outside operating cost is exhausted in taste satisfaction; present value of pay less invested consumption; present cost of past invested consumption less pay.
Rights to output; equal to output.
Transfer into value of human capital.
All behavior is maximization of perceived risk-adjusted output and return as a flow and a rate respectively.
Transfer out less transfer in.
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