00100	TWO MODELS OF POLITICAL ECONOMY
00200	
00300	
00400		A person's attitude to economic and political policy is often
00500	determined   by  his  implicit  acceptance  of  one  of  two  extreme
00600	conceptual models of how economic rewards are obtained:
00700	
00800		1.  It is possible to regard the world as  resource  limited.
00900	In  this  case  what a person gets is determined by what share of the
01000	resources he is  allocated,  and  the  main  problem  of  society  is
01100	political - how to carry out this allocation fairly.
01200	
01300		2.  The  alternative  is to regard the world as work limited.
01400	What is produced is determined by how much and how well people  work,
01500	and  the main problem of society is economic - how to motivate people
01600	to work well and to provide proper conditions  for  the  exchange  of
01700	what they produce.
01800	
01900		When  the  issue is put this precisely, I suppose most people
02000	will say that some rewards are resource limited  and  some  are  work
02100	limited.   Moreover,  the  general  theory of economics is capable of
02200	dealing with both extremes and with the mixed cases in between.
02300	
02400		However,  while  people  will   admit   resource   and   work
02500	limitations in principle, people are limited in what they can keep in
02600	mind at one time, and a given individual  tends  to  concentrate  his
02700	attention  in  one direction or another.  Moreover, the extreme cases
02800	are useful approximations to reality.
02900	
03000		In this essay, I am interested in two questions:
03100	
03200		1. In what ways is our country and our world resource or work
03300	limited?   In this, I shall take the position that we are mainly work
03400	limited, even  though  much  current  writing  seems  to  assume  the
03500	reverse.
03600	
03700		2.  How  are  people's ideas on this matter affected by their
03800	condition of life?   Herein,  I  have  come  to  the  almost  Marxist
03900	position  that  people's  ideas  on %2this matter%1 are substantially
04000	affected by their relation to the means of production as  it  affects
04100	whether %2their own%1 rewards are perceived as allocated or earned.
04200	
04300		As to the facts, the matter is somewhat complicated.  Whether
04400	a reward is resource or work limited depends on the time-scale
04500	considered, the reward itself, and on the person.  Let us consider
04600	a number of kinds of goods separately.
04700	
04800		1. %3Energy%1.  In the very short run, energy is resource limited.
04900	There is a certain amount of gasoline in the tanks, and we have to
05000	make do with it.  Normally there is enough so that people's use of it
05100	is determined by their habits which in turn are determined by the
05200	price and how it affects their allocation of their personal resources.
05300	For most people, the price of gasoline is not the determining factor
05400	in its use in the short run.  Whether you drive your car to a Ski Resort
05500	is determined by other factors of convenience and cost than the
05600	price of gasoline.
05700	
05800		In the slightly longer run, work limitations come in.  The 
05900	oil well can be pumped faster, and more men can be hired to dig
06000	coal.