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Posts: 5,065
Registered: ‎05-14-2010

what we believe

and of course sometimes we don't know why without some introspection.

 

Hogs are actually fundamental to today's reigning free market philosphy. The Chicago school of economics is built off of the work of Shultz where he studied the hog cycle and corn/hog ratio to demonstrate how the miraculous free market functions and a boatload of Nobels and a dominant intellectual stature for a half century followed. A few thoughts on that, though.

 

First, and probably least, worth pointing out that Schultz was able to do his work because of the abundance of longitudinal data that was available through the efforts of the intrusive and activist guvmint.

 

Second and more importantly, the basic conditions of a free market that he described in hogs no longer exists- most notably absent is a large enough number of producers that each acts independently, in his/her own assumed self interest in order to guide the miraculous invisible hand of the marketplace without any single actor individually affecting the market.

 

There may be issues of transparency as well but I'm not well enough versed to tackel that.

 

So while most are willing to believe that since the hog business in it's current structure evolved out of those conditions that it too is a free market.  It isn't, and we're really not coming to terms, at all, with understanding what sort of a beast it really is and how it affects all of us going forward.

 

In that way, and I think only that way, hogs still stand as an outstanding device for uderstanding the state of market forces, just like in Schultz' time, but in a completely revolutionary way.

 

I'm not seeing exactly where in academia that work is going to come from- dont see where the funding comes from, don't see "chairs" of departments giving support to faculty who want to explore that line of reasoning, actually see lots of indignant farmers  and agribusinesses types threatening funding for state institutions if they, as a farmer Regent in Iowa said "aren't all on the same page with agriculture."

 

On the other hand, about things we have accepted and currently believe, it is worth noting that Schultz left Iowa State for Chicago after a firestorm of criticism about his "anti-dairy" support of margarine ("let the market decide"). And of course, the U of Chicago was created and fully funded by John D. Rockefeller.

 

History does have plenty of examples of the importance of patrons. A discussion for another time.