Discussion - what is the economy and where are we headed?
All the recent talk of recession got me thinking about what actually is The Economy. The vast majority of economic activities in the end lead to fulfiling some consumer need. E.g. you may be an engineer building bridges, but a bridge is built such that goods can be transported, or that you can go to work for some consumer company. The same goes with the new factory and power stations in China, the iron ore from WA etc...
So really the economy is built on the back of consumers, and the economy expands by consumers wanting and having 3 TVs at home instead of 1, 50 pairs of shoes instead of 5, and new mobile phones every 6 months...Sure there are also those millions in China who never had a TV until recently. But all in all, I can't help to think that today's economy is primarily driven by desire rather than necessity.
If we all consume less, the economy will slow - but is that really such a bad thing? We will simply work less, stress less, earn less, but we also need less income because we consume less. The world may actually be a better place?
Any economists (professional or amature) out there keen to express their view?
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