Module 3 Essay: Economics
Blaze K. Munoz
Department of Entrepreneurship, Oklahoma State University
EEE – 2083 Entrepreneurship & Society
Professor Trost
February 13, 2023
Abstract
The economy and market are an uneasy and uncertain topic. In the article, “The Seen, the Unseen, and the Unrealized” by Per L. Bylund, the author touches on the topics of how the market works, what the economy is, economic theories, and the process of the economy. Throughout this paper, I will be going in depth on each one of these topics.
The How of the Market
The Market
The market is a very scary concept. But why is this? “The assumption many of us tend to hold is that the market is dysfunctional in some sense, and this warrants correction from another party – And there is only one other party: political authority” (Bylund, 2016, p.6).Leaving things to the market is a scary thought due to the thought of not having control. In my opinion, there is no secret that the market causes tension, conflict, uneasiness, challenges, obstacles, etc. within households; this is mostly due to not having control over the market (Bylund, 2016). This chaos is also due to capitalism and social status. Let’s be honest, we are humans with flesh who desire the newest product and want no one else to have what we have. Instead of being peaceful for mutual benefits, we would rather tear each other down to build ourselves up. We are too short viewed, instead of looking at the bigger picture we look at our life and only our concerns. The difference between the market and economy is that no one knows where the market will be in 24 hours. The market is totally uncontrollable as where the economy is controlled by us, the population. Now the question we ask ourselves is “does the market work”? That depends on each individual. Maybe the more important question is “what does the market bring about”? Once we figure that question out, it leads to multiple other questions. How can we improve the market? How does the market work? How does the market affect the world? Let’s focus on the question, how does the market work? In simplest form, exchange. When two individuals exchange something of value for something else with value, they just created a market.
What Economics is
We, the Economy
It is crazy to think that the very economy that determines individuals lives, is controlled by those very people. “Core to understanding the economy is recognizing that it is about human actions and interactions. In fact, the economy is people acting and interacting. It is little or nothing else” (Bylund, 2022, p.15). That is all the economy really is. It is based of our purchases and what we identify as “valuable”. As you might have thought, as well as me and I am sure millions of others, the economy is machines, materials, companies, or even Wall Street. Those are just things that help keep the economy running. However, the foundation, the main ingredient to this thing called the “economy” is based off of me and you. The economy in other words reacts off of our wants and needs, and based off of our purchases, we give something value. For instance, houses, there is nothing more rewarding than buying a home. Once you graduate and get a job, the main focus is to buy a house, meaning, real-estate has is a high valuable market. Boom. Economy. What is interesting is that there is always a tradeoff in the economy. By spending or saving your money, weather you are a cheapskate or a prodigal, one way or another, you are ranking things with value. One problem the world faces is production. Produce too much of something will little value and you lose money. Create to little of high valuables, now you got inflation. We the people are the economy, and there will never be a resting place for it to be still.
Economic Theory
Action
Everything has a theory. There is a reasoning behind all the motions in the world, especially the economy. The only way for the economy to keep going round and around is by action. The action is committed by individuals that keep the economy spinning. Most people think that Nike, Apple, Target, Ford, are companies that keep the economy running; however, “this does not change the fact that each person acts” (Bylund, 2022, p. 24). It is not these big corporations that give themselves value; if that is the case then every company would be extremely valuable. It is rather each individual in those corporations that gives something its value. BMW did not become a social status the first day they produced cars, but over time people gave them a higher value over other cars which is why BMW is one of the most prestigious car companies in the world. These values we place are all based off of one’s satisfaction. This goes hand in hand with the problem discussed in the previous paragraph, production. If everyone has the new trendy product, then satisfaction goes down. If there is a limitation on production, then those customers satisfaction goes up due having the limited product. Gives you a status over someone who does not. Supply and demand. Supply a lot and demand goes down. Supply little and demand goes up. This whole process is based off of the values that each individual acts towards.
Trust the Process
Not so Simple
The products within the economy did not arrive on store shelves with one phone call or one trial and error. We just see the end product, but what we do not see is the brainstorming, calculations, operations, development, finances, and trial and errors that went into the final product. There is a whole process behind the sense that we do not see as consumers. What is interesting is that within the process, there are 100 other side processes that went into that one product. “Its production was possible because there exist other processes and production” (Bylund, 2022, p. 42). Lipstick, there is a process with the machinery, ingredients, packaging; it goes even deeper with the electricity in the warehouse or water plumbing to allow the workers to use the bathroom or clean the workspace. In other words, each product is never accomplished just by one individual. This process goes back to the very beginning of time. You can only imagine the competition this causes. Companies compete both directly and indirectly with the materials they use and the customers they are selling to. There is competition with companies that are not even created yet, and those companies already created, derived from other companies competing. Some companies are too big to compete with, but companies will come and go which just adds fuel to this big process.
Reference Page
Bylund, P. L. (2016). Chapter 1: The How of the Market. In Seen, the unseen, and the unrealized: How regulations affect our everyday lives (pp. 1–14). essay, Lexington Books.
Bylund, P. L. (2022). Chapter 1: What Economics Is. In How to Think About the Economy: A Primer (pp. 15–20). essay, Mises Institute.
Bylund, P. L. (2022). Chapter 2: Economic Theory. In How to Think About the Economy: A Primer (pp. 21–26). essay, Mises Institute.
Bylund, P. L. (2022). Chapter 4: A Process, Not a Factory. In How to Think About the Economy: A Primer (pp. 41–50). essay, Mises Institute.
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