The post on the new economics has very briefly outlined the key elements of an economy, in particular distinguishing two different circuits of production: a basic circuit (which produces the goods and services that enter into a community’s standard of living) and a surplus circuit which produces the means of production that are repeatedly used to produce goods and services).
Some of the implications for housing are:
- we need to better understanding the impact of new technologies on the means of production of housing and how they have accelerated the production of dwellings
- most housing activity occurs in the redistribution function and the role of this function has been blatantly abused today. The role of finance is secondary to productive processes – finance has to adjust to the exigencies of productive processes. Yet the exchange of wealth in our economy is highly profitable and detrimental to the production of wealth.
- this economic heuristic distinguishes between types of finished dwellings – some are sold and repeatedly used to provide housing services as rented dwellings; some are sold directly into the community’s standard of living. How might this be relevant given the importance of the crossovers between the two circuits?
- any intervention and the type of intervention in the housing market will depend upon where the economy is at.
This post allows you to comment on “Housing in a Sane Global Economy – Starting Economics: Again!” presented at AHRC2019.