Home
>
Political
>
Immortality and Mortality in the Economic Sciences

Immortality and Mortality in the Economic Sciences

Roberto Calvo Macias, a young author and thinker from Spain, once wrote to me that it is impossible to design a coherent philosophy of Economy without accounting for the (sad?) fact that we are mortals. This insight is intriguing. It is not that we refrain from Death in dealing with matters economic. What are estate laws, annuities, life insurance policies - but ways to cope with the Great Harvester? But this, admittedly, only scratch the non-profound surface of the question.

The industrial revolution taught us that humans were dispensable. The process of production was reduced to minute functional units that people could learn in minutes. Only the most basic skills were required to successfully endure this learning curve. Thus, for as long as humans bred, the supply was inexhaustible. Humans became entirely replaceable, interchangeable (and alienated, in the process). Motion pictures of the period ("Metropolis", "Modern Times") portray the industrial worker as a nut in a machine, driven to the verge of insanity by the repetitiveness of his work.

Yet, this view of human resources is fast becoming extinct in the rich Western countries. Training periods have lengthened, expert knowledge has taken over, the main value added is information. Humans represent a sizeable investment in education. They are no longer an inexpensive resource .With this realization, there came about a revolution in economic relations. Absurdly, inhuman totalitarian regimes (especially Fascism and Communism) were the first to emphasize the importance of the human factor in the total set of means of production. The concept of scarcity was extended (by virtually all the economic systems today) to apply to human resources.

All resources are scarce. Economy is the science of trading off: giving up one resource in order to get more of another. The concept of "opportunity cost" is the first that students of economy encounter. The classic approach included natural endowments in the group of scarce resources. The human element was barely perceived as yet another natural resource. Now it is. The size of the population, its life expectancy, its quality of life, health, education, income ? are all important.

Economy is the branch of psychology which deals with behaviour patterns and with mental processes which relate to material wealth, with the opportunities to obtain it (=access to it) and with the processes and mechanisms underlying its attainment. Because material wealth can be expressed quantitatively, this specific branch acquired a "mathematical" nature, a twist not present in other branches of the human sciences. As such, it is highly surprising that so little formal thought was given to the issue of mortality (which is what makes the human resource scarce).

The legal profession is positively obsessed with Death. This is why economic activities are relegated to separate legal entities. The founders of a company are mortals ? the company itself, immortal. This is why the concepts of last wish, legal testament, estate and inheritance are so strong: they survive the person, they have an existence all their own. Economic theories, on the other hand, generally assume that humans are immortal and that their economic activities and legal entities which embody them have an infinite horizon. To some extent, this is justified by people's behaviour and by observing the social institutions that they form. People engage in very long term activities even when they are very old. No 80-year old inventor will give up his royalties just because he long surpassed his life expectancy and is about to die imminently. This is true even if he has no off-springs. No businessman will stop accumulating wealth just because he has enough for two lifetimes. No consumer will cease consuming simply because he has all that he needs to properly function. The life expectancy horizon is ineffective because w all deny the prospect of death. This denial mechanism is exceedingly strong in all of us ? we suppress the fact that we will die one day and that many of our activities, efforts, battles and pursuits look absolutely outlandish from this vantage point. So, economy mimics and reflects human defensive mechanisms: it is long term, infinite in scope.

Surprisingly, as Mr. Calvo Macias commented, the more temporally finite the organization ? the more dynamic it is. Religious establishments, which ostensibly trust in the after-life (a form of immortality) ? are procedurally rigid, ossified, frozen. This is also characteristic of states. The longer their past and the longer their perceived future (the Reich of a Thousand Years) ? the more morbidly paralysed these entities and their institutions. Dynamism is closely associated with finiteness and with the perception of mortality when it is coupled with rebellion. The rebel does not accept his own imminent demise. He fights back by being dynamic, that is, through the process of creation. The battle between creation and death is drawn along the lines of mortal fear.

And, so, we can distinguish two types of economic players: those who accept death and those who reject it. The first type is characterized by fear and anxiety as the driving force ? the second by deep seated denial and false confidence.

Those aware of their mortality display a decrease in economic activity with the onset of old age. They tend to attach a greater weight to their income the more recent it is. They discount future income and attach negligible weights to it. They tend to think short term as they grow older, towards the end of their lives they refrain from any economic activity bar trading, speculation, arbitrage, brokering and investments in financial assets. They become less risk averse as time passes.

Those who deny the crawling end still demonstrate an emotional attachment to wealth and to its accumulation at an old age. They do weigh income in accordance with its expected maturity (the more futuristic the income ? the less weight it carries) ? but they still attach some weight to it. Dividend Discounting Models in stock valuation assume an INFINITE stream of future dividends, discount it, add the results to get the CURRENT price of a stock. Stock in the New York Stock Exchange (NYSE) are trading now at a p/e (price to earnings) multiple of 18. Assuming a 35% average tax on dividends and on capital gains ? this means a person has to wait 28 years to recoup his investment. Taking into consideration risk free income (the interest payments that the person could have received had he invested the money in Treasury Bonds) ? the effective multiple is really 60 and above. Investors are willing to wait 60 years and more in order to receive their money back plus a reasonable return. This is the quintessential denial of the finiteness of life.

These two types clash and conflict. As they do, they generate the very fabric of market economies as we know them today. Players are trading risks, speculating, investing in projects, buying stocks ? all based on a hidden philosophies of life and death. It is this that we trade amongst us when we do: our own mortality.

About The Author

Sam Vaknin is the author of "Malignant Self Love - Narcissism Revisited" and "After the Rain - How the West Lost the East". He is a columnist in "Central Europe Review", United Press International (UPI) and ebookweb.org and the editor of mental health and Central East Europe categories in The Open Directory, Suite101 and searcheurope.com. Until recently, he served as the Economic Advisor to the Government of Macedonia.

His web site: http://samvak.tripod.com

professional maid services Glencoe ..

In The News:

Cybersecurity expert shares six essential steps to protect against dark web threats, including data removal services, password managers and antivirus software.

NVIDIA GPU space mission could revolutionize cloud services by enabling orbital data centers that make apps, games and AI tools faster and more efficient.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

Microsoft warns Windows 10 users face serious security risks as 90% of ransomware attacks target unsupported systems. Learn why upgrading to Windows 11 is crucial.

Nike unveils Project Amplify, revolutionary motorized shoes developed with Dephy that add powered assistance to every step for runners and walkers.

Cybersecurity experts warn about one of the largest credential compilations ever found, urging users to check "Have I Been Pwned" and change passwords immediately.

Quick iPhone and Android battery optimization techniques help your device stay powered all day by turning off hidden features that secretly drain power in the background.

Kodiak Driver autonomous truck achieves perfect 98 safety score, matching top human fleets in groundbreaking AI evaluation by Nauto's VERA system.

New 401k catch-up contribution rules in 2026 will change taxes for high earners over 50. Learn how scammers exploit these changes and protect your retirement savings.

Kurt Knutsson's guide covers social media privacy protection through location settings, account privacy controls and two-factor authentication to prevent scams and data breaches.

Revolutionary retinal implant restores central vision in 80% of patients with advanced macular degeneration, offering hope where treatments once only slowed blindness.

Learn how to use passkeys on Windows and Mac computers without cameras or fingerprint readers. Discover secure authentication methods that replace passwords.

Tesla's FSD v14.1.2 update reintroduces Mad Max mode, enabling higher speeds and more frequent lane changes than the standard Hurry profile setting.

A phishing email scam targeting American Express customers shows how cybercriminals use fake urgent messages to steal personal and financial information.

Facebook's new Meta AI feature analyzes your camera roll photos to create polished collages automatically, but requires cloud processing and raises privacy concerns.

A New Jersey teenager filed a major lawsuit against AI/Robotics Venture Strategy 3 Ltd. over ClothOff, an AI tool that created fake nude images from her social media photos.

Microsoft reports Storm-2657 cybercriminals sent phishing emails to 6,000 addresses at 25 universities to steal payroll credentials and redirect funds.

Astronomers have discovered asteroid 2025 SC79, a skyscraper-sized space rock orbiting the sun in just 128 days. the second-fastest known.

The Fox News AI Newsletter delivers the latest developments form the world of artificial intelligence, including the technology's challenges and opportunities.

A cyberattack on SimonMed Imaging exposed personal information of 1.2 million patients, including medical records, financial details and identity papers.

Spotify's managed accounts for kids under 13 now available in at least seven countries, allowing parents to filter and block explicit content and songs.

Friendly text conversations about BBQs and social events can lead to WEEX gold trading scams that target older adults with fake investment opportunities.

California company Skyeports creates self-healing glass spheres from Moon regolith that generate solar power and support plant growth for sustainable lunar living.

Cleafy researchers discover fake VPN streaming app Mobdro Pro that installs Klopatra banking Trojan, giving attackers full control over Android devices.

Police departments across the U.S. and Canada are adopting virtual reality training to better prepare officers for high-pressure, real-world situations.

Immortality and Mortality in the Economic Sciences

Political