Question

Russell Roberts, The Price of Everything: A Parable of Possibility and Prosperity

In chapter 10 of the story, “No Host No Problem,” Ramon accuses Ruth of “romanticizing the market” and of “romanticizing profits.” Ruth agrees but candidly replies that the market “deserves some romance.” What does she mean? (Hint: the specific tangible benefits of the invisible hand vs. short-run government policies.)

Please not the same answer again.

Answer 1

  Russell Roberts, The Price of Everything: A Parable of Possibility and Prosperity is a book that speaks about the basic economic principle and how the economy maintains itself without any external forces. It speaks about the concept of the ‘Invisible hand’ as suggested by Adam Smith in his work ‘The Wealth of Nations’. Here, he says that it is the simple principle of demand and supply that forms the basic principle of how an economy functions. It also discuss the spontaneous order of the economy, the presence of unseen forces and the price of everything that plays a huge role in the economy and helps to maintain harmony in the society.

                                    In the given situation, Ramon accuses Ruth of ‘romanticizing the market’. In real world economics, romanticizing the market means to induce such policies that can make the market function in a smooth manner. It may either refer to the ‘invisible hand’ of demand and supply that keeps correcting an economy in itself or may refer to the short-run policies that are induced by the government so that the economy is not disturbed and does not affect the smooth functioning of the society. The government functionary may induce many policies like changing the interest rates, buying and selling the securities, forcible maintenance of reserves etc so that the flow of wealth in the economy is maintained and the basic principle of supply and demand is unaltered or brought back to normalcy. Although prices are essential for the market system, the maintenance of the system via an emergent order is also essential for human productivity and prosperity.

                                    Thus the argument of Ruth that the market system needs some romance pertains to the advantage the market gets due to the presence of basic economic factors of the supply and demand and operations undertaken by the government policies to regain the lost strength of the market..