How Do We Test Capitalism vs Communism?

[@EconomicsExplained]

Switch to the good habit with tryfum.com/EE and use code EE to save additional 10% off your order. Thanks FÜM for sponsoring this video!

[@L17_8]

Jesus loves you ❤️ please turn to him and repent before it's too late. The end times described in the Bible are already happening in the world.

[@dragosica2005]

​@@L17_8😮😅😅😅

[@johannes_keeper]

Good points. There was no mention of state intervention in South Korea, Taiwan, and West Germany's industrialization tho. I have a bit of a video suggestion about sovereign wealth funds. Questions could be: How do SWFs help countries economically? What are its downsides? How can SWFs help their respective countries when an economic crisis happens?

[@seanlambert8600]

I think you could do better than that sort of product as a sponsor.

[@MrHazzerk]

​@@vardekpetrovic9716 be

[@gabrielfraser2109]

Last time I was this early, Argentine Treasury Bonds were a solid investment.

[@bengoacher4455]

last time I was this early Germany was the strongest economy in Europe

[@ashj_2088]

Hi 😚

[@watchman835]

Last time I was this early, it was 7am.

[@mesa9724]

@@bengoacher4455Still is, unfortunately.

[@amsd1231]

Has it ever been?

[@haldir108]

I think it's important to mention that the norwegian govt put production caps on oil to prevent it from swallowing up the rest of the economy, and to also ensure that our oil reserves would produce comfort for the norwegian people for a long time. The sovereign wealth fund was only started in 1990, decades after oil production started.

[@maximipe]

Yeah that whole section was like: I'm gonna compare these two countries even though is not a fair comparison at all lol. Tbh he could have invited some Venezuelan political scientist or economist but hey.

[@FlintIronstag23]

@@vardekpetrovic9716 Like he mentioned briefly in the video, Norway recently announced a huge phosphate deposit that is almost as big as the rest of the world's reserves combined. Titanium and vanadium were also found in these deposits. They are a blessed country when it comes to natural resources.

[@felipeferrari1754]

@@FlintIronstag23 Not only that, Norway has also excellent economy in other industries too like fishery, maritime and aluminium production. Also, part of the excellence created from the oil is also being applied on renewable energies like ocean wind turbines and the oil industries are present globally. I would dare to believe Norway will return to be one of the poorest countries after the oil goes dry.

[@carkawalakhatulistiwa]

​@@maximipeNorway learned from the mistakes of the Dutch when they discovered oil

[@martiddy]

​@@FlintIronstag23Those resources are only a good thing if the government knows how to spend the money. There are a lot of countries that have as many resources as Norway. And yet, they are total failures like Venezuela and some African countries. Government is and always will be the primary reason a country's economy is successful or not. For example, Taiwan does not have a lot of valuable natural resources. However, Taiwan is one of the most prosperous countries in the world.

[@andrewsang4688]

"nobody's going to let economists run experiments on their entire country" Looks at Chile

[@shauncameron8390]

Post-Pinochet is among the top 10 wealthiest countries in the Americas.

[@richardque4952]

You mean philosopher.

[@HOI4notsoproplayer]

​@@shauncameron8390and arguably the best in south america, maybe behind uruguay

[@P-Sides]

@@shauncameron8390yeah, also one with the most inequality, so much, their rewriting their constitution, bc it simply did not work. It’s really easy to be successful when the oppressor favors you 😉.

[@josiahmodaff6406]

Argentina now

[@Nagria2112]

small error correction(Lesson) in chemistry: when you showed dynamite (TNT) and Fertilizer (ammonium nitrate) 1) a better comparison would be "lab made" old school black powder. because it literally uses ammonium nitrate (and other ingredience) 2) left side @02:22 is NH4+ (ammonium) wich we actually do NOT care about. we care about the Nitrate part. you can also you potassiumntriate or other similar salts. side note: thats why nh4 and TNT dont look very similar (you didnt recognice that i guess?) BUT if you compare nitrate (NO3-) to TNT you will see that TNT is literally 3 NO3 stuck together (by toluol, that why the name is 3Nitrotoluol; if it was ammonia stuck to the sides it would be called triaminotoluene) nitrate are already very reactive (bccause of the energetic Nitrogen and alot of reactive Oxigen) but if you arrange them it this star formation it can easily be broken and release even more energy. sidenote 2 for nerds: it carrys its "own" oxygen. so it can actually explode underwater or in a vacuum.

[@David-fe1qz]

I went searching for this comment as soon as I saw the comparison. I'm not a chemist, but those chemicals did not look similar to me!

[@fictionalarachnid7197]

Um. Yes we do care about the ammonia for fertilizer. And that's nitroglycerin not TNT. From an industrial or economic standpoint ammonia is "similar" to any nitrated explosive since the precursor to these, nitric acid has for a long time been made from ammonia. Fun (?) Fact: In the buildup to WW1 Germany installed far more ammonia capacity than could ever reasonably be used for agriculture. It's thought that the synthetic explosives industry prolonged the war by years.

[@EconomicsExplained]

Thanks for the correction, we'll make sure to consult a chemist on the exact molecules next time we make this comparison (which will probably happen).

[@Nagria2112]

@@fictionalarachnid7197 this is a missunderstanding - yes Ammonia is important for fertilizer. And yes this was an Error in my Part. Its Not TNT, its nitroglycerin. But the only Mayor diffrence is middle Part - But the explosion comes mostly from the Nitrogroups.

[@declan8577]

Dynamite and TNT are not the same thing. Dynamite is a mixture of several components, the most important one being nitrogylcerin, which chemically looks similar to TNT, trinitrotoluene, but is not the same.

[@nickflottorp6154]

The Soviet Union dismantled all of East Germany's heavy industry and a significant part of its rail infrastructure. As much as 60% of total industrial production was taken by the USSR before reparations were ended in 1953. To say the USSR gave any support to East Germany is ridiculous.

[@badluck5647]

Eastern Germany did pretty well, considering the USSR took the state capital to Russia and then banned private capital in Germany.

[@nathanielknight1838]

where'd you learn that? The SU actually invested heavily into the DDR to make it their poster child for wealth by communism right next to the hated capitalists borders. Even that failed hard.

[@ilyake7862]

They gave cheap oil.

[@ravanpee1325]

@@ilyake7862 Just at the beginning, that was the reason why Erich Apel killed himself and the GDR switched from oil to coal

[@shorewall]

@@LTNetjak Yeah, if centrally planned economies don't care about benefitting the people at their own expense, then why would they care about the Environment?

[@mindfulpessimist]

Another interesting comparison -- one we looked at in university -- is Canada vs. Argentina. In 1900 their economies were similar, but they went in two very different directions after that.

[@carkawalakhatulistiwa]

Because US put dictator in Argentina

[@shauncameron8390]

Juan Domingo Peron.

[@MortonT1958]

@@shauncameron8390Peron is certainly at the top of the list.

[@benhollanders7911]

Canada trives due to it's proximity to the usa, if Argentina had that it would've done a lot better (less dictatorships lol)

[@Dragoon77]

@@benhollanders7911Cuba disagrees

[@samklibaner7252]

One thing I think is worth talking about in comparing these countries is that a lot of them were democracies verses dictatorship. Now to some degree I know that seems natural because dictatorships tend more easily tip towards central planned economics. But it is worth noting how that itself might have affected economic development. Especially, when comparing Korea's. From that graph you showed the South started pulling ahead of the North in the Eighties, and then it really hit off in Nineties onward. This largely lines up with its transition from dictatorship to democracy. I think this is worth mentioning because I'd argue that being a democracy can itself have a strong effect on economic wellbeing outside of a just its economic policy. That's because leaders in a democracy not only have more reason focus more on promoting general wellbeing (verse say military buildup) but also to adjust policies when the fail. Their power comes from making people's lives better so if a policy starts failing that's incentive to stop, or at least modify them, where a dictatorship only needs to keep a specific clique of people happy (mainly the military and elites) so they don't have reason to stop, and the mindset of a dictatorship tends to encourage seeing all criticism as a threat verse constructive discussion, so that's even more reason to ignore failings, and create echoes chambers where you might not even hear about them. I think what would be more interesting is examining countries that kept the same political system but changed their economic policy. Like how thatcherism in both the short and long term effected the UK, or the effects of China moving away from Moa's original policies to a more Free Market system, might have led its increased levels of prosperity. Because in those cases you really do control for a lot of other factors, and an maybe get a better view of the impact of the economic policies themselves.

[@Prororo]

But some people have to realize why they were authoritarian in the first place

[@hengzi-cartoon]

@@Prororo You asked the key question. Many people believe that dictatorship is evil and should not exist. However, in some cultures, it is democracy which cannot survive.

[@한수진-l3p]

The policies that brought economic change and progress were the byproduct of years long plans during the dictatorship periods in the South, fostering Korea's current strong industries. Within dictatorship vs dictatorship even with rich natural resources in the North, south pulled ahead which proves the superiority of the capitalist system

[@nokia-gm8gv]

fr

[@juricakonsec2337]

You can't have socialism without a dictatorship, because in a democracy people won't accept it or will vote it away as soon as it shows its real face.

[@Celis.C]

Here's an idea for a video: How would the economies of 'imperial core' countries perform if they didn't have access to 'imperial periphery' resources, or would have to acquire them through fair market means?

[@erloriel]

Basically a "how useful are empires (economically)" video? Sounds awesome.

[@sultanmustafa71]

Great idea!

[@nicknickbon22]

Basically an “economics of the Roman Empire”, video. But to some extent even the ussr could be seen as an empire economy. For example it produced cotton in the syr darya and amu darya valleys in Central Asia, even if it meant drying up the Aral Sea, which was the 4th largest lake in the world. The best thing to do economically would have been importing it from India, Brazil, or the USA.

[@ridingweeb4801]

well the british lost insane amounts of money trying to develop the 3rd world and it didnt work in the end anyways

[@uscbro69]

It’ll depend heavily on who yu have in mind. uSA? They’d be richer had they stayed out of Middle East. Britain? Unsure. Rome? Almost certainly would be poorer without their vassal states

[@tacitus6384]

A detail you've missed regarding the marshal plan in Europe: Germany received very little of that $13.3 billion. Only something like 10%. Edit: Germany had the "German Miracle", or Wirtschaftswunder, overseen by Ludwig Erhard, which was accomplished by currency reformation, liberalizing the economy and removing price controls and rationing. Compare this with the UK that remained on rationing and price controls and was lagging far behind Germany for the next decade or so despite having more of its infrastructure intact and less of its young men being killed in the war.

[@Jay_Johnson]

Europe is a pretty big, place. 10% isn't that bad when the UK, France, Italy the Netherlands, Belgium, Austria, Denmark, Greece, Norway, Sweden, Switzerland, Turkey, Ireland, Portugal and Iceland all received funds. West Germany had similar level of funding to Italy.

[@TheKlaun9]

​@@Jay_Johnsondo you mean it's not a bad share or do you mean it was a major contribution? If it's the first, I don't get your point. If it's the latter, difficult topic, not getting involved

[@motionpictures6629]

Adjusted for inflation, Germany got 23 billion € around 0.5 % of today's GDP

[@Jay_Johnson]

@@TheKlaun9 It's not a bad share

[@Arcaryon]

@@TheKlaun9 I think what is at least partially mentioned here is the fact that being surrounded by stable, relatively wealthy economies can make an enormous difference for the economic success of a state. Of course, this should be obvious but people far too often ignore a states overall location when they discuss its development. It’s much easier to develop a stable economy when you border countries with strong, mostly unbroken legal traditions for example than if you find yourself located in the middle of war torn, poverty ridden states.

[@alanchacindreissig2380]

Great video. Being from Venezuela, it's very interesting to me seeing how other economists view my country. I suggest you looking more into it and into our politic problems so you have a clearer view on how corruption has almost destroyed any hopes for our economy. That being said, I truly believe this is one of your best videos: objective and well explained, also not too long. Great job

[@deezeed2817]

It’s not “corruption”. The U.S weaponised its economic power to overthrow the Bolivarian government and install a puppet in the form of Juan Guaido. It’s imperialism that’s the primary cause of misery in Venezuela.

[@robertmiller6444]

A big problem with the supposed distinction between micro and macro is that it doesn't work like that. Macro is the AGGREGATION of all of the micro. It's like saying a forest is somehow distinct from the trees of which it is comprised. No, a forest is an emergent property of the trees of which it is comprised as does not exist apart from those trees.

[@ambition112]

0:24: 🌍 The study of economics is divided into microeconomics and macroeconomics, but studying macroeconomics is challenging due to the complexity of human behavior and the inability to conduct controlled experiments on a large scale. 6:00: 📈 Centrally planned communist economic policies in North Korea have squandered its advantages, while free market systems in South Korea have enabled it to flourish into one of the most powerful economies in the world. 7:05: 📊 The difference in economic performance between North Korea and East Germany can be attributed to factors beyond just the profit motive. 10:27: 📚 Centrally planned economies have the advantage of making big decisive investments, but they struggle with resource allocation and negative externalities, while market economies waste resources and struggle with externalities. 14:29: 📚 Norway and Venezuela both faced challenges in managing their natural resource wealth, but Norway focused on economic stability while Venezuela prioritized rapid growth at the expense of stability. 17:26: 📚 Norway's economic stability is attributed to their sovereign wealth fund which acts as an economic shock absorber. Recap by Tammy AI

[@ocadioan]

2:21 Maybe stick to economics, because the two compounds shown are not at all similar to anyone with even a high school level of understanding chemical structural drawings. For starters, the one on the right isn't dynamite, but Nitroglycerin, which is only _one_ part of making dynamite.

[@sheldoniusRex]

The problem I worry about the most with command economies is the inevitability of human corruption. *Inevitability.* When you centralize everything not only do you incentivise corruption, you make it more efficient at the same time. OF COURSE command economies waste resources on politically motivated boondoggles. The powerful use the entire economy as a tool to keep power. Inevitably this means that certain sectors, like defense or the welfare state become ridiculously bloated with money and personnel at the expense of making basic items everyone actually needs. In theroy command economies could just produce the basic necessities, but the incentive structure inherent to politics means that no one in power has any reason to actually make that happen.

[@TheWedabest]

I can see your point. But corruption is a human problem, no matter the economic system! Corruption can take root in any country or system.

[@thomaswikstrand8397]

You do realize you're describing the US, right? Immense waste of resources, the most bloated military budget in history and corruption being basically considered a virtue.

[@oliviastratton2169]

​@@TheWedabestYes, but it's statistically more significant in command economies. If a private company wastes money on the fancies of it's executives it might be outcompeted by a less wasteful firm. But when the entire economy is under government monopoly, pleasing the dictator or oligarchs is all that matters. People will fudge their numbers to get ahead in the Party and there are no consequences until people start starving.

[@TheWedabest]

@oliviastratton2169 one minimizes it. The other spreads it around. Corruption the scourge of mankind! People need to stop saying that one economic and financial system is the best (capitalism), and all others are terrible! No system is perfect. Use what works, what doesn't don't use it! I don't know why that's impossible for people to understand!?

[@exemplify6593]

Command economies should not be equated to dictatorial governments; a command economy is one where, "an economy in which production, investment, prices, and incomes are determined centrally by a government." To believe that these governments necessarily have to be undemocratic - and that is to suggest that that government lacks checks and balances - is a false equivalency. You can have a planned economy without having a dictator or hegemony.

[@marshallparsons1146]

13:32 Re: Negative externalities - it is hard to beat centrally planned economies for fouling their nest. Europe's most polluted city is in Romania. And the USSR generated 1.5 times as much environmental waste for GDP as the US.

[@ronald3836]

Exactly. I guess the idea was that free markets inherently waste resources through creative destruction. But central planners inevitably make outright mistakes (and will then try to cover them up, resulting in even more damage).

[@ommin202]

Can you do a video about the "dutch disease" happening in Canada, especially Western Canada? Oil in Alberta, and Forestry/Fishing in BC. We're effectively a separate economy from Eastern Canada but the only thing we really do competitively is resource extraction.

[@scott2452]

It is worth mentioning that it is difficult to get a true understanding of economic growth in a centrally planned economy…when the state sets prices, they can work the numbers to get whatever growth they like. Under such misconceptions as the labour theory of value they attribute value to products that may have no consumer demand.

[@catdogmousecheese]

Yeah, but there are other ways of measuring economic growth besides official reported figures. A good example is by looking at the Korean peninsula from satellite view at night you'll immediately notice that while almost all of South Korea is lighted only North Korea's capital has light with a few other dots around it.

[@wesleywagumba2806]

As a Marxist I can't think of an example of this.

[@vericbasilio]

@@catdogmousecheese This is a really bad comparison because NK was actually doing 20x better during the Cold War than SK, and comparing them now is because it's their own leader's fault for being isolated and hostile due to the collapse of communism. Now having a different ideal of communism because they are no longer influenced by the soviet.

[@davefa1432]

Thanks. These videos are perfect. I use them for my economic education. You're helping educate the citizenry on a subject - economics - so critical to our democratic and civic participation. Thanks so much

[@GnomaPhobic]

I think this is my favorite video that you've done so far. Rational, sober analysis. The use of sovereign wealth funds for long term investment and income vs the immediate spending on social uplifting programs reminds me of the difference between people with old money, and people who win the lottery. It's a lot harder to moderate your spending and exercise restraint around money when you've not 'grown up' so to speak with it.

[@haldir108]

The norwegian sovereign wealth fund wasn't established until 1990, decades after oil production started. Far more important, was: Conceptualizing the oil as property of the norwegian people, and limiting foreign oil companies to being compensated for the work of extracting it, rather than allowing them to profit from it directly. Investing the revenue into both unrelated, and supporting industries, generating technical competence that can benefit the other parts of the economy. Limiting production to X number of barrels per year, reducing the shock to exchange rates and limiting the extent to which the oil industry can eat the rest of the economy. (and also increasing the longevity of our oil revenues) The sovereign wealth fund gets a lot of attention, but it came AFTER Norway had already risen to the upper echelons of HDI rankings and GDP per capita. The privot from focusing on resources and industry, to focusing (more) on investment, capital and finance is a lesser part of the picture than the ones i mention above.

[@jimmacgregor4459]

@haldir108 It may be fair to say the socio-economic pressures in Venezuela handicapped its ability to take a similar approach.

[@sinoroman]

How long can South Korea last with the current system

[@stephendaley266]

Anyone with 'old money' should have it confiscated. That just means that they can't remember which dead ancestors first stole enough to create the family fortune. Lazy rich idiots shouldn't be allowed to control the economy.

[@Sunflowersarepretty]

I think its a good idea to often repeat what you've explained in previous videos. Call me dumb or whatever but I finally understood "dutch disease" here in this one and I had to watch that part 5 or 6 times.

[@rashedulkabir6227]

Is FUM similar as vape?

[@Sunflowersarepretty]

@@rashedulkabir6227 no idea I wouldnt get it tho.

[@EconomicsExplained]

We talk about it a lot but Dutch Disease is basically the issues a country encounters when there is a sharp increase in production of raw materials (i.e. oil), which leads to a downturn in other sectors within the same economy relative to the resource.

[@jaibandroide]

I know, it has happened it other concepts, it gets repeated so much that i finally enters my skull lol

[@skindred1888]

Basically....people get excited about the new gold mine and leave their stable farm to try get rich like everyone else.

[@JMM33RanMA]

This is a very well done video, but there are several things that need to be mentioned. I taught in S. Korea spread out over several decades. When I started, the government had become a military dictatorship. Pres. Park had two main objectives, 1. creating a modern industrialized economy, and 2. improving the living conditions of the people. 3. Improving education, though while education was a priority, democracy wasn't and this gave rise to student demonstrations and the eventual overthrow of the government and establishment of a truly democratic one [that had deposed and jailed dictators, while the US has yet to jail a former president🤞]. The educational drive led to sending large numbers of students to US universities, something that many other countries have done. They also improved and increased the number of universities in the country. They prioritized the learning of English because the medical and technology fields required English competency, even getting into a good Korean university, getting a good job at a big company or even getting a promotion in the Korean military requires getting a good score on an English exam. The Park government did [through the Sae Maul Program] improve farming , education and modernization of industry, where it succeeded most was in aligning with the West, which made it temper, somewhat, the totalitarianism, and the increase in education and sending people to freer countries led to an educated opposition that eventually prevailed. Basically the drive to improve the individual's life, and that of the family and country, works better than propagandistic exhortations to improve the working class through one party politics!

[@marksuave25]

"the already wealthier regions of West Germany didn't pull that much further ahead". That is funny. They went from being maybe 25% wealthier to 200 to 300% wealthier in the first decade. Never let the facts get in the way of a great story. Still a good video EE.

[@ravanpee1325]

In the late 40s, East Germany was in an economical better situation until the introduction of the DM in West Germany and the following growth

[@nicknickbon22]

I think it meant in the early years, until maybe the early 1960s, before the German Wirtschaftwunder.

[@Arcaryon]

Considering that the Soviets pushed millions of Germans from centuries old German territory into the GDR leaving them with nothing but what little they could carry while also looting the territory in their control thoroughly, literally bringing entire factories to Russia, people need to stop looking at the GDR as existing in a vacuum. People often seem to forget about the impact of the world wars when discussing the modern German economy despite it being the single most impactful period in the regions entire history. Like the video mentioned, US-Americans on the other hand poured billions of dollars worth of investments into restoring some semblance of wealth into particularly France & the UK, something it could afford to do since the war had practically not reached its shores. When one considers these factors, the dramatic differences between both economies can be hardly explained by referring to principles that tie to central vs decentral planning and the reason this matters is because far too many debates today try to push for more decentral planning in the wrong areas and at the same time, central planning is often equally overrated in other areas of discussion.

[@chinguunerdenebadrakh7022]

That does tend to happen when one's economic model collapses and has to rebuild into a new model.

[@marksuave25]

@@chinguunerdenebadrakh7022 but they never caught up, never did. The planned economies of communism just don't work.

[@MrDadyD]

"CCP has more open market, less regulation.. then most western countries"... Their industries are also to a high degree subsidised by the state

[@Arcaryon]

I think looking at the CCP, one finds the same thing that is true in many western economies - ultimately, the state and the economy are interlinked to a degree where it’s impossible to separate the political system from the industrial interests, and while the exact balance of power varies, one thing one can arguably say currently is that it’s possible that more than one road leads to the goal of prosperity and power.

[@jimmacgregor4459]

I think this is your best effort. It's continuously important to hold up a mirror to disciplines, to be accountable, and to do so in a constructive way.

[@darkdep]

Amazing video. One of my faves of yours so far. I enjoy learning about the concepts of socialism/communism and discussing how some of those ideas could make society better. This is extremely hard to do, as most people just instantly go into one-dimensional arguments against such things, usually with the footer "It's been tried before and failed". You highlighted so many excellent points that almost completely separate the ideas of capitalism vs socialism/communism. You DO highlight "free market" vs "planned economy" and I think this particular comparison is one I'm going to use now. Capitalism != free market, and socialism/communism != planned economy. Just because it has sometimes ended up that way, it's not really a feature of the systems.

[@Prororo]

Socialism has been tried before and it worked

[@tannerweinheimer7839]

Where? Capitalist systems with social redistribution of wealth do not count.@@Prororo

[@alexv3357]

In the case of South Korea, it needs to be pointed out that South Korea was _not_ a free market until the 1980s. It was until then still a dictatorship, and lacked democracy and the rule of law, which are both defining characteristics of an actual free market, so comparisons of the two Koreas from before the South's opening and democratisation aren't terribly fair.

[@DieNibelungenliad]

Democracy is not the free market

[@noahjohnson935]

That's not necessarily true. Dictatorships can still be "free market". Chile under Pinochet was turned into a playground for corporations to act freely. Banana Republics were basically designed to allow the fruit companies free reign on their plantations to out compete locals and maximize profits to feed the larger free market of the US.

[@alexv3357]

@@noahjohnson935 Banana Republics are most emphatically not free markets. The fruit companies were not meaningfully independent private companies, they were the foundation of the various dictators' political power, and the state used its power to protect them from competition in exchange for their loyalty, while at the same time squashing any local industries and interest groups that might give rise to political opposition. As I said above, there is no free market without real freedom.

[@noahjohnson935]

@@alexv3357 you have it flipped around. The Fruit Companies installed and controlled the Banana Republic governments. A leader without the stamp of approval of United Fruit in Guatemala or Honduras didn't last long 90% of the time. The US military and the CIA tended to help out when mercenaries didn't get the job done.

[@alexv3357]

@@noahjohnson935 Sometimes that was true, sometimes it wasn't. Either way, the result is that without the rule of law, civil liberties, and private property rights, ordinary people in banana republics are not free to start their own enterprises and compete on equal terms with each other and with foreign firms, which is the only characteristic that actually matters; whether a state is a colony or an independent country with a dictatorship, the end result is that the economy isn't free.

[@obliviouz]

The difference between command economies and free market economies isn't just a matter of motivation, but a matter of decision-making. Free markets, like democracies, are effectively crowd-sourced decision making systems - with the benefit that the subject of those decisions are also the "crowd" making them.

[@ronald3836]

Agreed, but I think this was also stated in the video. It is really interesting that the key to humanity's "great leap forward" is the idea to have the state facilitate that people can just do what they want.

[@ravanpee1325]

Also you have price signals

[@Simboiss]

No, free markets are not crowd-sourced. It sounds like a broken clock, giving the right time sometimes just by sheer chance. When the boss of a business takes a decision, there is no democracy, no "crowd-sourcing", nothing. It's completely arbitrary. Taking decisions for a profit motive cannot lead to success in the long-run (because profit is not what the consumers are looking for), and any "posititve" outcome is the result of the broken clock giving the right time occasionally.

[@ronald3836]

@@Simboiss the point of free markets is that they align the individual interest of making a profit with the general interest of achieving an efficient use of resources. If a company makes a bad business decision, the company will make less profit or even go bankrupt, which means that the system corrected itself. Obviously regulation is needed to let the market function at all, e.g. there needs to be public infrastructure and rule of law. The alternative to a free market is central planning. Has been tried, does not work, forget it, unless you have genocidal tendencies.

[@danielkjm]

The only freedom in free markets its the freedom to exploit it.

[@joellakleinhesselink4325]

South Korea went from being among the top 10 poorest countries in the world to the 10th wealthiest in the past 70 years. They have experienced so much growth that there is a clear difference in height between generations. Truly amazing

[@kzcciynk]

@johnthompson5333please cite the reason for the growth of “communist” china

[@oliviastratton2169]

​@johnthompson5333Only after they ditched a bunch of communist policies; and now that they're cracking down with regulations again, their economy is stalling. Also, most of China's "wealth" is due to its large population. South Korea has a much higher GDP per Capita.

[@KimmyTheDarkTrader]

Again we see a bunch of ignorant to the history and using South Korea to compare the success of Capitalism and so-called success of Democracy. The Miracle of Han River have nothing to do with it basically and it is rule by an Authoritarian Regime after a military coup led by Park Chung-Hee overthrew the democratic party. He ruled for almost 16 years after killed in 1979. During that time, I don't think the Plutocracy were that worst in South Korea compare to today other than being criticized as repressive and heavy-handed. Today to say the wealthiest are even worst, maybe it is correct at the top level, but normal citizens suffering from low fertility rate and high suicides rate. You can see a change of "Chaebols" during those days but it basically only fosters huge profits and other rewards for its large business conglomerates for the past 20-30 years. Is that what you are trying provide example and tell the world that this is the greatest system implement by South Korea? Telling you the history doesn't mean to say "Capitalism" is not good. All system are double edge sword, either Capitalism or Communism. The problem is when a system is implement by an evil person, it will just leads to a country destruction. Shut off your computer, go learn some history and economics before trying to spread your ignorant and disinformation all around the internet.

[@Prororo]

@@KimmyTheDarkTraderthe thing is, capitalism is much more likely to be unjust as it’s an ideology for PRIVATE owners which are known as the ruling class/ capitalist class/ the ruling elite Their sole purpose is to make as much profits as possible and not actually serving the people whereas socialism is an ideology for the PEOPLE which are known as the working class Capitalism relies on private ownership (property is owned by private owners) while socialism is the abolishment of private property

[@johannes_keeper]

You forgot to give credit to South Korea's heavy government intervention that guided the early years of its industrialization. South Korea had very few competitive advantages after the war, and the dictatorial government that rose to power was instrumental to the creation of competitive industries for South Korea today, like shipbuilding, automobiles, steel, oil, chemicals. and consumer electronics.

[@TheBooban]

Yes. And not just S.Korea. All the Asian tigers did this and China is following that model. So they are all centrally planned. Planned to exploit western generosity to export into their open markets while protecting their own. So this video is a big fail.

[@Drakelett]

Exactly. South Korea was a military dictatorship until the late 1980s. The big Korean companies we know today - Samsung, LG, Hyundai/Kia, etc - only exist because of heavy government support - much like the CCP is doing today in China.

[@David-lr2vi]

Was going to mention this as well. It’s doubtful that South Korea would be where it is today without the central planning of government and the central planning of the Chaebol corporations that still happen to this day. Samsung makes up a huge part of the South Korean economy, far more than comparable free markets so basically most of the South Korean economy is centrally planned, by Samsung.

[@Arcaryon]

⁠@@David-lr2viI think ultimately, the debate of central vs decentralized planning is perhaps one that thinks economics too broadly, ignoring too many of the actual more detailed circumstances.

[@David-lr2vi]

@@Arcaryon There shouldn’t really be any debate between free market (capitalism) and centrally planned (communism) systems. Both systems have their specific advantages and uses in all societies. Certain areas of society are unsuitable for free markets and certain areas are unsuitable for central planning, the real debate should be in determining which system is best for which area of society.

[@male_maid5951]

As you touched on here, A video dedicated to sanctions on there longterm effects in determine mid-long term economic prosperity would be good.

[@yay-cat]

Nice video thanks! I’d love a video of how France has kept African currencies low with the CFA franc so that it can extract uranium and other resources.

[@ps.2]

Wait... whatever happened to the CFA, anyway? Last I knew (granted, the '80s), it was pegged to the French franc, which of course no longer exists.

[@zhoudan4387]

This is gold. Wonderful documentary

[@jesuschrist8]

If you want to measure the system that is superior, measure its spending - a.k.a. the amount and times value is transferred. Communists have public spending while capitalist have both public and private spending.

[@BojanLovrovic]

Been watching your videos forever, you are amazing and I hope you never stop. I would be interested in a deeper dive into Venezuela vs. Norway.

[@199Bubi]

Love your channel and recently wanted to credit information from your videos in a masters thesis. Sadly it's really hard to cite EE as a source. would it be a possibility for you to convert your videos into citable sources? Maybe publish the transcripts and sources or so...?

[@intifadayuri]

Dont take neoliberal yt vids as a reliable source please

[@199Bubi]

@@kreight_ I appreciate your comment! Still, I would have enjoyed EE artices on basics like the factors of production OR for referencing interesting concepts as such.

[@eisenstein99]

I'm not very well versed in contemporary European history, but if I remembered correctly the USSR pretty much dismantled what East Germany had for industrial base and pack it back to Russia. I think it would already be very generous to say that the USSR was not actively tanking the economy of East Germany, let alone "help". And it is interesting that you raised North/South Korea as an example for "free market" vs "planned economy". However, it would be more beneficial if you could examine the facts closer: 1. while it is true that NK had better heavy industrial base than the South, it had significantly less light industry, agriculture, and commerce 2. starting in 1950s, NK was sanctioned by the US, which, at the time, represents ~40% of world economic power. Meanwhile, US gave out huge funds to SK to develop. At the time, US was indeed the kingmaker of economic power 3. SK economy took off between 1960s and 1980s, under the rule of a military junta led by dictator Park Chung Hee. Park Chung Hee literally adopted "Five Year Plan" to boost SK's industrial prowess. State bank heavily subsidized the chaebols (this is where the famous LG, Samsung, and Hyundai come from). Park was very protectionist as well. He restricted most imports of foreign goods except for raw materials. After Park's assassination in 1979, another military dictator Chun Doo-hwan took over and carried out similar industrial policies till 1990s, at which time SK's industrial base had already been established. So I would say it is very irresponsible to use North/South Korea as an example to analyze "free market" vs "planned economy"

[@shauncameron8390]

Yet received Soviet aid.

[@eisenstein99]

@@shauncameron8390 soviet aid faded away around 1970s if I remember correctly, while US aid to SK lasted longer than that. and the soviet economy was at best around half of the US during that time. plus my point being NK was actively denied entry by more than 40% of the world economy.

[@nevid4280]

It would be really interesting if you did an episode on the economics of the former Yugoslavia!

[@TheWedabest]

Which one?

[@felipealvarezsuarez2202]

Among other considerations, an important factor to take into account when comparing Venezuela and Norway is the disparity in size, education, and available human capital between the two countries.The Venezuelan terrain is nearly three times larger than Norway's, it's worth mentioning that a substantial portion of Norway's land is inhospitable, while most of the Venezueland territory is host to its population. Furthermore, In the 1970s, Venezuela's population was already 11.3 million, while Norway's was only 3.8 million, making Venezuela three times larger at the time, population wise. This size difference comes with its own challenges, as it can be easier to coordinate, distribute benefits, make decisions, and uphold democracy in smaller populations. Additionally, Norway's integration into the European economic region has provided it with access to a broad range of goods and services, that Venezuela just did not had, including high-quality education and the possibility to acquire a highly skilled labor force, machinery and goods from the vast European labor market. In contrast, the Venezuelan population did not have access to these advantages. I have not done a proper investigation but making and assumption here and specualting that Norway also had way better infresturctor and education thourght the metioned deacades and going forward than Venezuela.

[@Arcaryon]

I too think circumstances beyond policies are often underappreciated. There are many differences between East (GDR) & West (BRD)Germany too for example which went far beyond the political principles people would often discuss when referring to either nation and I just heard about overall comparable differences between North and South Korea. I think one thing one has to establish consequently is that one should focus too much on one aspect or another but try to look at any state in at least some amount depth, otherwise one risks loosing oneself in some detail ( centralized vs decentralised economics ) and misunderstands the greater underlying issues.

[@theboxfox6532]

If you ask 100 micro-economists (Accountants), if they're good you'll get 100 of the same answer. You ask a 100 Macro-economists, you will have a 100 different answers.

[@richhornie7000]

Macroecomomy is just astrology for old men 😂

[@JohnSmith-o6h9l]

5:02 That’s the Third Avenue Bridge in Minneapolis, Minnesota. Cool.

[@shafinhanif8802]

Disappointed that you didn't talk about the difference between East and West in modern Germany. Hope you make a video about it soon

[@TheKlaun9]

If you're interested in learning about that, just ask questions. Germans love nothing more than if a foreigner is interested in their country and will bombard you with all sorts of information. Of course, Google helps as well. However, if you're German, don't you know that stuff already? In any case, this isn't the kind of channel that shows you charts about how rents are cheaper but incomes are lower in some places. It's more about broader economics, mostly taking one (or more) examples to teach a general lesson about everything.

[@mavinwiz]

Great video! Now I'm curious if your team could do a video breakdown of another set of Economic Twins also virtual City States - Hong Kong vs Singapore. Fascinating to see the development over the past 50 years

[@johncurtis920]

A free market inspires diversity. Diversity breeds resiliency into a system, hence democratically aligned economic systems will always outperform any central planning system. Central planning is akin to a monoculture. As such so long as the environment it is within remains static it can function with a illusion of resilence, but come the first real change in that environment it then breaks and falls apart. A free-market system tends to better at rolling with the punches of the changes in its day to day.

[@ZeroGravitas187]

Diversity does lead to more resiliency. OTOH "free markets" can lead to the exact opposite. Look at the USA and how much unpoliced anti-competitive behavior is allowed to the point where there is no longer a choice in goods or services--because market players wanted to own everything. Left to their own thing, companies grow ever larger and mergers and acquisitions lead to less resiliency and not more. A case study is the enshittification of the internet. Where players will run their companies at a loss, in order to drive out competition--and once they have control of a market, raise their prices/fees to what they should have been all along to actually run. According to US courts--this isn't anticompetitive behavior--because this cannot exist. I could point at Amazon or KZbin or NetFlix or any number of 'Silicon Valley' businesses that have pulled this stunt to get people addicted to their product only to make people regret getting addicted to them as the loss in economic diversity has strangled any consumer choice. Another one is the well documented tendency of what Dollar Stores do to local brick and mortar retail. They kill it--and retail workers are worse off as well.

[@quintessenceSL]

Free markets tend towards monopoly. Democracies towards oligarchy. Central planning is required to an extent to maintain competition within markets, lest the rise and fall of monopolies happen over such a long duration as to be meaningless to a lifetime. Any supposed "free market" already has suppositions baked in its premise to be functional no different than central planning. What you are look for is "natural" markets.

[@ihl0700677525]

​@quintessenceSL 1. Free Market is *NOT* anarchy, it is indeed "centrally planned" system, with rules and regulations in place, to keep the market *artificially free.* However, unlike in command economy, the "central planners" of the free market do not influence or direct the market to pursue some idealism beyond "free market" itself. In other words, Free Market (i.e. keeping the market free) is the primary objective and the goal in itself. There is no other agenda like to create "social justice" or "common good" and any other wishy-washy bs. 2. "Anarchy" might lead to monopoly, altho in long term the market will always return to equilibrium. No form of monopoly (whether state or company), however powerful and influential, could resist it, such as EIC and VOC (by far the two most powerful companies in human history, each with total control over their own captive market, and each command massive merchant fleet and mighty private military). Market equilibrium is inevitable. In this case, the state or the monopoly can never quench our innate desire to be free. Even if the monopoly is legalized or by design or protected (e.g. state monopoly), people will resort to *black market.*

[@damiendeecee]

@@quintessenceSL "free markets tend towards monopoly" Citations? I've heard economists say that they're never found a free market monopoly that established itself without government force.

[@ihl0700677525]

​@@damiendeecee Monopoly is not necessarily bad. It is abusive monopoly with *anti-competitive behaviors* that we should avoid. Companies like Tesla and SpaceX can achieve monopoly or near-monopoly status because they were the first and/or have by far the best and the most advanced product in the market. As long as they gain their monopoly status legally and did not abuse that monopoly status, it is perfectly fine.

[@DSPLAYEROK]

Planet economy can work really well if you have the advantage of being behind. In this instance leaders don’t need to predict future insight, but can simply use the countries ahead as examples

[@ledonuthole]

I think regardless of whether a problem is a “macro” problem or “micro” problem the solution always uses the principles of microeconomics by reworking incentives, etc…

[@shorewall]

I agree. Governments want to pretend they are different, and then kick the can down the road.

[@SineN0mine3]

They're just economic principles and solutions being applied at different scales. Macro is at the national level and above and micro is at the interpersonal level.

[@jurajskoda]

"We as humans have unlimited desires but only limited resources to fulfill those desires" 1.What to produce 2.How much to produce 3.Who to produce for?

[@鄭文-o2b]

Communism/socialism has never created wealth, only redistribute it

[@endthecorruption6663]

very well-done video. Nuanced. All-encompassing. Thoughtful.

[@d.mort.]

Hold up. Füm is claiming a chemical free aroma… by definition that is impossible. I would steer clear from advertising a company making these claims.

[@ronald3836]

Of course you are right about "chemical free", but that's how marketing works in a free market economy :) en.wikipedia.org/wiki/Chemical_free It always irks me to read things like "biological" or "organic" milk. Hehe: "Biological farming is a chemical free method of farming that focuses on improving the microbiology as a way of increasing plant growth and produce yield."

[@hereigoagain5050]

Great video! Minor correction. Researchers can compare multiple treatments (independent variables) in experimental designs. This is not taught in intro stats, so many non-statisticians believe it is only possible to perform A-B testing.

[@Dosenwerfer]

13:29 Yes there is: An individual can pay a company that subsidizes other companies, that lower their emissions. Thus, individuals are incentivizing lower emissions. The reason why this has not really happened yet, is most likely because people aren't valuing this enough in reality, despite what they say or think. A big part is also the prisoner's dilemma.

[@shorewall]

Part of it also is exporting our pollution to China. Not in my backyard. If the US kept our manufacturing in house, then I think it would be a bigger issue. And on the flip side, the current environmentalism often overlooks China and India's pollution, thereby incentivizing more manufacturing to go overseas.

[@JosephSolisAlcaydeAlberici]

In the Philippines, there is a constitutional provision that prohibits foreigners from owning domestic corporations and private lands with 100% (only 40% is allowed) that has been in the constitutional document since 1935, and the unintended consequence is that the Philippines doesn't attract adequate amount of foreign direct investments (FDI) necessary to industrialize PH economy, hence due to the underinvestment in the agriculture, mining, and manufacturing sectors, many Filipinos opt to emigrate to the Middle Eastern countries to work as skilled laborers in the skyscraper projects in Saudi Arabia and UAE.

[@Shineon83]

Ah….yes…fears of another “colonization,” of sorts…I know that in the US, along with most Western countries, no such bans exist, as corporations from other countries own much land and large stakes in US corporations (with limits or outright bans for countries deemed “unfriendly” to US interests)… Even in the US, such foreign investment & ownership has been crucial to the success of several industries & businesses that had trouble attracting local investment (or when investment has been insufficient)….Though fears of being “overrun” are understandable, they def hurt investment & development (and really have no place in today’s rule-based system)….The trick, of course, is to limit ownership to countries that have been long-term allies, and ones that have rule of law (under US law, for example, corporations are subservient to national laws-so that if, for example, the Philippines decided to nationalize corporations that Americans had majority stakes in-the US corporations would have to agree to a buy-out, and to leave)….That’s your protection (but, of course, not all countries adhere to the those laws-mainly some Asian & former Eastern Bloc countries)… I’ve always felt that The Philippines had enormous potential. I hope you (finally) get NEW ppl in your political system to shake up the Old Boys Club, change the laws-and rid your country of the corruption that, interestingly, goes hand-in-hand with such laws (most Western corporations use strict auditing practices. Corruption would be much harder to get away with)….

[@userMB1]

In this channel there is a lot of talk about economic policies but not enough about the REAL reason why some countries make better economic policies than others. That fundamental reason is *the population of wealthy countries have INTERNALIZED democratic values and the other countries didn't* Just being able to vote is not the same as internalizing democratic values. I'm not a social scientist so i can't give a scientific reason why some countries don't become real democratic, but it's pretty clear that Democratic Values is the primary reason for succes.

[@floydblandston108]

Well said, and I would add that true 'Marxism' is the ultimate collective flowering of democracy.

[@moors710]

Speaking of Soviet heavy industry, when I went to Moscow in 1975 I noticed quite a few items that might have been made of plastics or wood in the USA seemed to be made of cast iron.

[@neeneko]

One other problem with trying to draw such direct comparisons between single data points is that people tend to only look at the one axis and draw a conclusion. If you look at the typical 'communist vs capitalist' countries, the examples people like to cite also have one other major difference : multi-party democracy vs single party autoracy (which includes theocratic and corporate states). Varying on those shows something interesting.. capitalist countries that are also single party look a lot like communist countries that are single party.... which raises a whole bunch of questions around 'why have we not seen multi-party communist countries?' Either way, it doesn't appear the economic system is the primary variable for such disparity in the example set we have to work with. But I am also a big proponent of selectorate theory ^_^

[@ravanpee1325]

There were also different factions in the SED e.g.power struggle between Ulbricht (Chrustschow guy) and Zaisser (Beria ally)...Ulbricht vs. Honecker (Breschnew buddy)..or Honecker vs. Krenz, Stoph, Mielke and Co (Gorbatschow guys)

[@ronald3836]

You are very very close to drawing the logical conclusion: communism implies a single-party autocracy (and totalitarianism, and suffering of millions). It is NOT a coincidence that multi-party communist countries have never existed. If you have a communist party in your country, then be aware that what they want is to turn your country into a totalitarian state.

[@KrolPawi]

​@@ravanpee1325diffrent faction are not a diffrent parties. There never truly was a communist democracy( not suprising given the fact that russia seems to become a grotesqe caricature of every economic system possible quite fast and they were the ones spreading communist ideaology,truly a dystopian society ). Its possible that multiparty systems just force politicians to be better and both economic systems work and multi party systems just provide incentive to actually advance the nation ,beacuse pepole are holding them accountable. Internal politics and factionalization within the party do not replace democracy.

[@shauncameron8390]

@@KrolPawi And for good reason. Remember the USSR in the late 80's or Yugoslavia after Tito died?

[@oliviastratton2169]

What capitalist country has a single-party autocracy? Also, most economies are mixed to some degree. So even within democratic capitalist countries you can sometimes find organizations, regions, or industries that have employed socialist/communist policies (see: Depression-Era price-fixing in USA). You can use these instances to observe how those specific organizations and policies succeed or fail.

[@Scoots1994]

13:31 Talking about air quality while showing water cooling towers that don't pollute at all.

[@sergeykish]

Do you compare with official USSR, North Korea GDP values? This could explain why there was not much gap.

[@atrution]

@13:50 I think you meant this is why pollution is tolerated for industry profit in first and second world nations.

[@Immudzen]

I still have a hard time accepting economics is a science. I can accept it is useful but not that it is science. I don't see how models are proposed and then controlled and tested. We don't really have the ability to run many copies of an area in parallel with only the one thing we want changed. it seems there is also a large problem with achieving any kind of consensus on an issue due to how flexibly the data can be interpreted.

[@economiccrisis9267]

It's a social science like sociology.

[@shorewall]

@@economiccrisis9267 Yeah, I would hesitate to call it a hard science, but it is a social science. Studying human behavior is a big grey area, because humans are weird. We have plenty of natural motivations, like food, shelter, etc. But we also have higher functions that matter, but are more opaque. And I would also argue that Microeconomics does verge into hard science territory, since it is a lot easier to examine and control for.

[@stunningandbased5516]

@@economiccrisis9267 It's just straight up a different branch of psychology. Trying to make sense of it via natural science won't work.

[@sebastianbrodkin3685]

Yea it aint a hard science. It has great guesses and theories. But nothing is 100% certain, and there exist many scammy economics like Marxism or Keynesian economics, or MMT. Im saying this as an AnCap so Im super biased though :D.

[@seanvalentinus]

Do you have a vid that goes into what you think the Aus government should do to use those natural resource benefits for the good of the people? If not, would love to see one.

[@64thecaptain]

Have you seen the recent divergence of housing prices (and inflation) in Minneapolis/St. Paul after Minneapolis significantly deregulated the housing market? It provides a similar example of how free market principles tend to win out over centralized planning (or over regulation)

[@sor3999]

Regulation in zoning has gone far beyond preventing factories from opening up next door. To using any rule in the book to ensure housing scarcity.

[@johndoh5182]

Even in the US, the distribution of revenue coming from oil has changed dramatically over the last 3 decades via tax law. The profit of that used to go more into funding the govts of states and the fed which used to do many things it doesn't anymore, one being R&D into many other fields which is EXACTLY what you should be doing with that oil wealth. Instead that money is almost completely going to investors now, which is EXACTLY what Dutch disease is caused by.

[@MrRezillo]

Simple question to answer: cmpare the number of people fleeing communist countries of capitalist ones with the number of people leaving capitalist countries for communist ones. Next question.

[@bluestar4003]

an interesting case to look at in the free market vs central planning discussion is Japan. it’s undoubtedly a capitalist free market economy, but one which has always viewed the proverbial hand of the market with a good deal more suspicion than does, say, the united states. still today, but even more so in the postwar period, the japanese government exerted substantial central planning influence on key sectors such as heavy industry, technology, banking, and transportation. If you’ve ever wondered why Kawasaki makes motorcycles and watercraft but not cars, or why Yamaha makes literally everything *but* cars, it’s because the government decided that only Toyota, Honda, and Subaru should make consumer cars (Mitsubishi snuck in and managed to get away with it) in order to limit domestic competition and make sure that the selected companies would have enough competition to keep them sharp but not so much that labor, physical resources, or financial resources would be scarce and constrain their growth or their ability to compete internationally.

[@schrenk-d]

How do you think some of the other big communist or socialist countries, particularly Venezuela and let us say, Cuba, or even Vietnam would be fairing IF the US didn't sanction them so heavily?

[@ZeroGravitas187]

And that should have been a very large topic. At the end of it, many countries hailed as capitalist power houses (today) only became that way because of massive economic stimulus from abroad. And many failed states became that way because of economics--but also sanctions had a lot to do with it..

[@FerdarPleaseSubscribe]

@@ZeroGravitas187 preach

[@carbonstar9091]

This is the standard communist excuse for why their economic system is an abject failure. Complete refusal to accept responsibility or have any introspection whatsoever. Which seems to be a feature of Marxism. It will work this time guys! Repeated implosions and continuous low standards of living are everyone else's fault. If you would just willingly let us turn humanity into slaves communism would totally work. Utopia is right around the corner!

[@damiendeecee]

They definitely would do better.. but not anywhere near so well as if they had greater economic freedom.

[@damiendeecee]

@@ZeroGravitas187 Australia didn't have extreme economic stimulus from abroad.

[@living_curious]

@EconomicsExplained, “It’s harder to control when people {don’t} have a say through their spending” 10:42

[@marth8000]

Do you want to take a vacation in North Korea? or South Korea? - China? or Taiwan? - Russia? or America? - Cuba? or The Dominican Republic? - Venezuela? or Peru? Have you ever heard the saying "it's an opinion so stupid, only intellectuals could debate it"

[@mwasovski]

I would take vacations on Cuba over América any time

[@Ryanisthere]

7:22 on the contrary people innovate when they have enough money that they dont need to worry about money so pushing more people above that bar leads to more innovation

[@jacobwiens659]

My high school econ teacher taught us the comparison between North and South Korea. He pointed out that, even though the north was communist and the south was capitalist starting the 50s, South Korea’s economy did not surge ahead until the 1970s, when it transitioned from dictatorship to democracy. This would indicate that South Korea’s success is attributable to democracy rather than capitalism.

[@fullmetaltheorist]

A bit of both. Cause there are capitalist dictatorships that are wealthy. Aka the Arab oil countries and Singapore.

[@eisenstein99]

South Korea did not transition into a democracy until the 1990s. Between 1961 and 1979, it was ruled by a military junta led by General Park Chung Hee. After Park's assassination in 1979, he was succeeded by another military dictator Chun Doo-hwan who ruled till 1987.

[@WPSent]

Going to have to disagree that market solutions cannot deal with "community needs". People can either refuse to buy those more polluting options or market actors can do things like surveys to find out what people want. To continue, the central planner "solution" to this has also had times it hilariously backfired. Example, in the US small trucks don't exist. Why? Because the EPA implemented a rule that basically said small trucks need to have such a high MPG that it is impossible to get. So small, less polluting trucks died off and now all that the market is legally allowed are big trucks with big engines when most people could've done with something smaller. Now, I'm not saying there isn't a place for a touch of government regulation, but the key word there is "touch" and not what America has for sure.

[@AlexanderTheTanker]

One thing you're missing re what motivates people, it's not entirely money A lot of high IQ people don't make nearly as much money as one would think, esp cus a lot of them get into academics. Money isn't the primary motivator for the work people do on an individual level, many people intentionally take a pay decrease to get a more rewarding job.

[@ronald3836]

The USSR had quite a few briiliant academics, but that did not result in economic growth. What you need are the entrepreneurs that take the ideas and found businesses. That was not possible in the USSR.

[@Jay_Johnson]

@@ronald3836 That's the point though economic growth is not the sole motivator in peoples careers.

[@dazzlebreak4458]

@@ronald3836 "Economic growth" is a capitalist term. USSR and the Eastern Bloc didn't even care about that until the 60's when it became clear that people have needs like food, cars and housing, so they directed some resources toward producing or importing these things. In my country (former Eastern Bloc) in order to be able to hold any kind of title or position (including academic ones) you had to be "politically reliable" (if your family was "bourgeoisie" or was associated with the previous regime it's a no go; also, if you are caught saying politically inappropriate things - there were informants in all institutions). In universities there were quotas for children of "people who fought against fascism and capitalism" and ethnic minorities.

[@JuanDeLaRosaTV]

@@ronald3836the USSR’s elite were doctors and scientists. People who normally don’t care about economic growth.

[@ronald3836]

@@Jay_Johnson But it is what improves the lives of people. I agree that not everybody is motivated by money (or at least not by "as much money as possible"), and that is also a good thing.

[@kaminarinoyouni2311]

A key factor not noted here in North Korea's fall from economic grace was the North Korean war which obliterated the infrastructure in the north. Then the decision to over industrialize without adequate power reserves. An additional problem factor for the North was a lack of food production.

[@oliviastratton2169]

I thought the Korean War caused huge damage to both sides?

[@ohadish]

1:10 shows chinese/ japanese in north western canada ?

[@casparcoaster1936]

the difference, is corruption

[@FlashMeterRed]

11:45 that's the wrong graph. The 3 decades following the Korean War are the 50s, 60s and 70s. You can barely see it ending there. Weird because you have the complete graph later.

[@michaelreynolds5773]

I have a question. Is the formulation that we have endless desires and limited means actually true? I'm at sort of the low end of the 1% and I have to tell you, I'm pretty content with what I have. I have no interest in a bigger house - I don't entertain and I don't want to have staff. I have two nice cars which I barely drive, why would I need a third or a tenth? I'm not lacking in ambition, I went from quite poor to quite comfortable, but I have no interest in working to become the next Jeff Bezos. So, is it actually true that people have unlimited desires? Because I don't think it is, not for the vast majority of people.

[@megajatt123]

That part, even if it is true for 99% of the 1%, is overshadowed by the others. Some people are just megalomaniacs who want to become god or the closest thing possible. If 1 person has endless desire, that makes it net endless desire for the entire species haha

[@noraleestone2859]

All that makes you an Outlier, so EE's assertion still stands. 😁

[@shorewall]

You have decided that the tradeoffs aren't worth it. If you could have a genie, that would give you unlimited wishes, you would have plenty to wish for, even now. But you have limited resources, including time, attention, energy, money, etc. So you have engaged in economics to come to the conclusion that you are satisfied with what you have. That is the point. It is also in aggregate. In order for the whole world to live like you, it is impossible at our current levels. The amount of production, pollution, land, etc, in order to enable your lifestyle for every current living human would require multiple Earths. We all want more than we have, more than we even can create. And that leads to the core problem of economics, how to allocate limited resources to our functionally unlimited desires.

[@rolfviehmann6240]

I think that wants and needs and desires are not really unlimited for us humans, but most people who have ever lived so far in the history of mankind (including the vast majority of people alive today) had a lot less than what they would have wanted to have. You said that you have two nice cars to drive? Lovely, but a poor person may have never owned or driven a single car in their entire life, so the number of people who would buy cars if they had the means to do so is huge. Look at China, when I was a child, China was considered to be a poor country, so most Chinese citizens were happy about having a bicycle at hand. But now that many Chinese can afford cars, they do so in large numbers. So for economists, the wants and needs and desires are not the limiting factor for economic growth, but things like limited raw materials (including things like oil and gas and coal), limited workers to turn the materials into goods to sell, or the amount of pollution that is or is not legally acceptable in a given economy. In other words: You are the exception, not the norm, so as long as most people are much poorer than you, they have tons and tons of things they would buy immediately if given the means to do so. So the word "unlimited" is not correct in a mathematical sense, but in a practical sense. We are not yet living in a post-scarcity world, and may never experience one. You may already experience a post-scarcity life and love it, but it may be a dream many people will never experience first hand.

[@hellmalm]

In Sweden we have companies that are so successful turning “trash” into energy we actually import “trash” from other countries. So market economics can handle thing like this as well, “communist” plan economics is not necessary. I think it’s more of realizing that someone else’s trash might be your gold. Also the idea of limited resources is stupid, every thing is reusable. Also just like demand, are ideas, innovation and the entrepreneurial spirit limitless.

[@rashedulkabir6227]

Is FUM similar as Vape?

[@Mashhul]

Well, free market systems will lead to giving everything to a few people....which is how we got here, especially the US Communism was about giving everything to the government...which didn't go well What we never tried is giving everything to...well...everyone? Such as the case of economic systems based on communal, decentralized ownership, not centralized to the state or big corporations...

[@shorewall]

Decentralize and be conquered by a centralized state. That is why states centralize in the first place. US tried starting as a confederacy, but it didn't work, so they tried again with the Constitution, creating a federation. The American South lost the Civil War because they were too decentralized, fighting a very centralized North. The World Wars were fought by centralized states, with the Germans and Russians starting out centralized, and the Americans and Brits having to centralize in order to match them. In fact, the End of WW2 lead to the new paradigm, where centralized technocracies run our world. College boys in bureaucracies make our decision, TOP MEN. Except now it's breaking down. My only hope is in that original compromise, Federation. Allowing smaller states to exist, but be joined into a strong federation. The US is one, and the EU can become one. Then we need to clean house and take out the corrupt entrenched political elites who are in bed with the corpos, and take the corpos down a peg.

[@shauncameron8390]

That is just not sustainable as many will squander what was given to them becoming a burden and threat to those who wisely saved and grew their resources.

[@guitarazn90210]

@@shorewall The US civil war was a bit more complex than that. The north was more industrialized and had a larger population than the rural south. The north wasn't doing too well in the beginning, but they were smart enough to keep firing generals until gains were made.

[@oliviastratton2169]

Venezuela tried organizing industries as "cooperatives" instead of top-down state industries. But that didn't work out too well either.

[@Financial_Revolution]

9:35 ABSOLUTELY RIGHT, this is called the calculation problem by Mises. You MUST buy principles of economics by Saifedean Ammous author of the Bitcoin standard and fiat standard. No more of Keynes stupid theories, welcome to the real economist club !

[@floydblandston108]

All of you Austrian School dorkwads strike me as boys who have never dated.... why is that?

[@Financial_Revolution]

@@floydblandston108 wierdo.

[@rocky171986]

Hmmm why are you endorsing a product that has not been approved by the FDA or an equivalent jurisdiction?

[@ronald3836]

Free market 🙂

[@greenmario3011]

It's not a type of product that the FDA regulates. That's like asking why a chair wasn't ATF approved.

[@TheInvisibleHandCo]

Amazing video!

[@pablonetx]

It's difficult to really compare different economic systems when one kind is actively sabotaged by the other. North Korea and Venezuela have been under hit with sanctions ever since their socialist experiments. That doesn't completely excuse their results, but it should have been discussed in this video.

[@stress_tess]

Yah they talked a bit about the intervention of the US and other western capitalist countries in the examples of Korea and Germany. So I was pretty surprised when sanctions against Venezuela weren’t mentioned. It seems kinda hard to evaluate Socialism when the leading global superpower is antagonistic and actively sabotages countries that try it. And then after the fact points to these failures as evidence it never works

[@danielkjm]

Chile, Peru, Brazil, Nicarágua, Comumbia, Cuba... All of them were targeted, from Coups, invasions and even sabotage.

[@gamebreakerfn]

DO you have a video on Austrian Economics? If not, I'd love to see one :D

[@fullmetaltheorist]

I think he does.

[@SpellingBeeWiner]

One thing to note is that South Korea has a plummeting birth rate, massive brain drain, and some truly horrible cultural impacts that can easily be attributed to capitalism. (For example that almost 25% of young women, aged 19-29, have undergone plastic surgery. A figure that keeps going up at they age.) It's entirely possible that with a birthrate almost half of Japans (a country popular for it's horribly low birthrate) that North Korea will simply outlast South Korea. That leads to the questions: Is late-stage capitalism perhaps even more pernicious than the most corrupt, incompetent communist dictatorships? Is this a problem unique to the Koreas? What could be done to curb these negative outcomes?

[@shorewall]

What is the NK birthrate? China's is pretty abysmal as well. There is data that suggests that rate of industrialization, as well as city living, correlates with declining birth rate. In an agrarian society, child labor is a key resource, and there is plenty of space for big families. In an industrialized, city living society, children are a luxury, requiring vast investment in education, entertainment, healthcare, space, etc. I do think there is some kind of demographic crisis brewing, but it is not limited to Capitalist countries. China and Russia are also experiencing massive demographic decline. Also, the idea that declining birth rates, plastic surgery use, and emigration are to be avoided is a judgement call. It may very well be a rational reaction to the current circumstances, which is not understood at a bird's eye view. I don't think outsiders can truly understand a society. I consider Japan a close ally of the US, I have positive opinions of them, and I like many of their cultural products. But when I learn about society there, I never want to be a part of it. But I also feel the same way about Los Angeles or New York City. People live how and where they choose, even if they don't understand their options to change that. And if people want to move, maybe that is market correction. I don't guess that people are moving from South Korea to North Korea. :D

[@erenucar1486]

SK has horrible work culture. They literally work themselves to death. I read that with current birth rates there would not be any Korean left in 150 years

[@Justme-to6yu]

Ur points stem from cultural practices, not economic. The “capitalist” economic factors simply enable the population a greater degree in how they practice their needs and wants, which are driven by their societal cultures and norms. From my perspective, free market or not, all 3 east asian countries have low birth rates. Their societal structure is extremely orderly and shame-based. They (to a certain degree) stifle individualism and creativity. In return, people vie for validation of their power and position in the set order and structure of the society. If your neighbor has done a plastic surgery and is therefore societally more elevated than you in terms of looks, it incentivizes you to seek out the “norm”. Western civs societies tend to be less self conscious. Though less orderly, people tend to not care about what others think of themselves. Simply put, their issues are the cause of societal and cultural phenomenons. They never changed. Back when Korea was dirt poor, the society set extreme hierarchical structures in place (and I mean extreme). People obsessed over their hierarchical standing, just because it was socially accepted. After world wars, colonization, and gaining immense wealth, their obsession simply changed to material ones. The individual means nothing, if they are not validated by their community. Edit: its not “cultural impacts attributed to capitalism”. Its cultural impacts perverted by capitalism. This is evident, because the same does happen in other late-capitalistic countries.

[@DommTom]

Fairness and transparency. These are the factors that I am looking for.

[@EconomicsExplained]

That's okay if you have a choice of where you live, but unfortunately many people don't.

[@DommTom]

@@EconomicsExplained That's the blessing of a fair system. Many system however are neither and that causes lots of misery. Edit: Thanks for your response

[@Avaricumstudios]

This is the story of Subsaharan Africa, where 'experts' in New York,London and Moscow created economic policies for Countries in post independence Africa ,most of these economic experts treated Subsaharan Africa countries as study grounds to test economic theories...this went on for about 40 or so years until Subsaharan countries had their own economists and their 'experts' ,this is why from the early 2000s growth in these countries exploded from Kenya to Ghana ,Ethiopia etc. Also explains why Chinese debt has contributed so much to the growth of these economies while its just a fraction of the amount of Aid African countries received/receives from Moscow or the West.

[@nathanielknight1838]

but the issue with the aid was that really that governments were pushed into staying poor in order to continue to receive benefits. that created a negative feedback loop. But you also can't exactly disregard the human capital factor in terms of security and education and the resulting administration that was bloated but also necessary to be truly independent. Do the same things happen without the aid? Doubtful at least. Even in Botswana which can be seen as an example of an independent African nation growing positively, it came about from a man educated in a foreign country and applying those principles.

[@mesa9724]

Norway was really smart with it’s oil money. On average each Norwegian owns 260 thousand dollars worth of equities, real estate and other investments in their sovereign wealth fund.

[@mayanksingh0044]

@14:29 You say Venezuela while the old man was reading the newspaper of Hindi Language (INDIA)

[@hh-nh6ju]

basically same country innit poor and ruled by dumb dictator

[@gerardrampal]

Have you done an episode on the economics of Mauritius? There doesn't seem to be one and less so from other content creators. Would be interesting to hear your views on the tiny developing island. 🙏

[@T00Busy113]

South Korea was governed by military dictator Park Chung Hee between 1961-1972, starting the Han river miracle. At the same time, Vietnam war was ongoing, so America was linient on military dictatorship and given South Korea many favourable business deals to support the war such as shipping and food supply. Hence why we see Chebols like Samsung, LG and Hyundai become what it is today. South Korea was just in the right time and right place that their economy benefited from Vietnam war

[@KohrakGKOH]

I'm Venezuelan, hearing PDVSA being pronounced in English is weird. Took me a moment to realize what you were talking about 🤣

[@wertywerrtyson5529]

The Norway vs Venezuela example was good. Some people claim that any kind of intervention in the economy is inherently wrong and the state should do nothing. But Norway is the prime example of what the state can do right. They provide plenty of welfare for their citizens without being communist like USSR. And while some will claim they would be even richer with no government it’s pretty clear that in this case the government actually did good. Otherwise the profits would only benefit a few international corporations. Of course having a well functioning, competent and non corrupt government is not easy. You need to have a culture of good education, doing the right thing and looking out for everyone. You need to give the government enough power to do good and yet have the government not use that power for personal gain. This isn’t something that any country can just copy if they have a different culture of thinking about yourself first and of course this culture can change. I’ve seen how my country of Sweden has become more about private gain over the decades and it’s become more and more acceptable to be greedy and selfish and even something that people should strive to be rather than showing solidarity.

[@damiendeecee]

You'd be surprised by how little the Norway government involves itself in market decisions, though. It's 12th in economic freedom, compared to the US's 25th.. which makes it a highly free market nation.

[@wertywerrtyson5529]

@@damiendeecee Sweden is even higher up on market freedom but that doesn’t mean it’s better for regular people. Compared to Denmark (because Norway is a bit unfair to compare with because they have oil) we have more billionaires but the a average Danish citizen is more wealthy than us. This is despite (or because?) they have higher taxes and have many taxes we have taken away such as property tax, inheritance tax and gift tax. It’s not as simple as less taxes makes everyone better off it seems. But yes all of the Scandinavian countries are high on the economic freedom index.

[@damiendeecee]

@@wertywerrtyson5529 the Scandinavian countries keep swapping around in economic freedom indices a lot. I doubt the high tax rate of Denmark is making it wealthier than your country. There would have to be either fairly significant historical differences in development, or significant macroeconomic differences for that change to take effect.

[@wertywerrtyson5529]

@@damiendeecee Sweden has historically been richer and Denmark only surpassed us recently. It’s possible that the differences in taxes are just a coincidence but at the. Wet least it doesn’t seem to help the regular citizens here that we have much higher billionaires per capita ratio. Even the US taxes the rich higher than we do. The middle class is taxed a lot here but not the rich. The idea is that they create jobs but if so why is Denmark suddenly better off among the middle class than us and have less debt? Their currency was as valuable as ours a few years ago but now theirs are worth 40% more than ours. Clearly they are doing something right or we something wrong. Some people would be quick to point out that we have a lot more immigration but I don’t know if that would be the issue.

[@jaibandroide]

I love so much this channel, it helps a lot in understanding the world and some of the lessons carry to my economic decisions, do you guys know of channels like this but for microeconomics?

[@Jcewazhere]

I forget, did Norway receive huge sanctions and foreign 'involvement' when they started using oil profits to help the people? So comparing the two while ignoring that difference seems off. I like EE, and he was quite fair in this video. It's just weird that he left that bit out.

[@shorewall]

Yeah, Venezuala was sanctioned for "helping people". Just like Putin is under sanctions for "liberating the Ukranian People".

[@kumarabhishek5652]

Free market is best and only check it can have is to not let monopolies and duopolies to be formed in the first place. Make system pro-competition instead of big corps. It would be a win-win situation for the market, employee and growth.

[@10-OSwords]

The central economic problem is NOT unlimited wants. It's people have basic human rights needs but means of production are not controlled by the general population & the people who do control the economy have no interest in providing for basic human needs of the general population.

[@raspberrypie3826]

i think you dont understand how wrong you are here comparing social policies with economic ones. if your statement were true then europe would be as much a shithole as africa is right now

[@ChrisLangland]

Im curious as to how you’d compare the practices of Norway and Saudi Arabia regarding their sovereign wealth funds.

[@justtoleavecomments3755]

The problem with these comparisons between centralized vs 'free' economies is that the biggest factor: geopolitics is always ignored. Maybe the reason South Korea was so prosperous is because it had the full backing of the richest biggest economies in the world; whereas, the North had all those powers actively working against it ... maybe ?

[@oliviastratton2169]

North Korea had support from the USSR and China. It initiated and almost won the Korean War before Western countries stepped in to help South Korea.

[@emanym]

Much of the problems in the world don’t stem from a lack of understanding, but rather a lack of care.