Given the performance of academic economics over the last fifty years and the scandals in peer-reviewed academic journals, studying hetrodox economists is well worth your while if you are interested in truth rather than tenure. But I can save you the trouble, having looked into many of them: Keen is the one to read.
https://www.amazon.com/Debunking-Economics-Revised-Expanded-...
He's genius-tier, maybe our era's Keynes.
He is very difficult to categorize: he is a liberal Australian academic who is an admirer of both Keynes and Hayek, and has built upon and synthesized both of their work. He does a lot of computer simulations of economies using real-world behaviors (e.g. mark-up pricing) and has generated results and opinions that are guaranteed to annoy pretty much everyone.
He blogs at Forbes (which is funny, given his politics):
http://www.forbes.com/sites/stevekeen/
And has a great book out that takes on classical economics:
http://www.amazon.com/Debunking-Economics-Revised-Expanded-D...
Just going to leave this here. Its a real helpful read for any kind of economics debate.
Real markets work on markup-based pricing and cash flow from profits. See Steve Keen's work[1]. In a world where the banking system can introduce nearly infinite leverage into any financial transaction (see student loans) what's the price of anything?
[1] - http://www.amazon.com/Debunking-Economics-Revised-Expanded-D...
> I would respectfully disagree. Market clearing is I think technically the price for the next unit of production, but even in a world of zero marginal cost (not quite true) then the capital cost still needs to be paid back (laptop, time spent coding flappy up and flappy down). So perhaps the clearing price is the expected number if sales divided by capex?
This is closer to reality (and further from economic theory but that is a different rant[0]).
The trouble is to decide whether to make the investment of that capital cost you need to rely on that other economics assumption: perfect information. The real world doesn't provide perfect information of future customer behaviour so you don't know at the start if you are making Flappy Bird or Floppy Bird. Once you have made it your aim is to maximise your income from it (given the zero marginal cost in the App store). That maximisation needs to occur at a time when the capital cost has already been spent so the capex doesn't actually affect the price you charge. Even if you are making a loss increasing the price doesn't help as less people will buy it (you were already at the profit maximisation point) and if you were making a profit cutting the price reduces the profit.
Note that even the information at the time to set the price isn't available so you are guessing again there without the economists perfect information assumption.
Free markets are good but especially in the real world they are not always optimal and market failure isn't unusual. I think app review (at least the keeping malware out, not necessarily the Apple payment lock in part) is a public good but one that would be hard to get people to voluntarily pay for separately and some of the benefit is communal (you benefit from me not having a malware infested phone). We might end up in agreement here.
Yeah, regulation is a balancing act.
[0] http://www.amazon.co.uk/Debunking-Economics-Revised-Expanded...
In an 'efficient' market all future risk is included in the analysis of current value meaning that if it was an 'efficient' market this would actually not be a problem. However it is just one of many* ways that markets are not in reality 'efficient' in the economics sense as the assumptions required to prove them just do not match up to the real world.
* http://www.amazon.com/Debunking-Economics-Revised-Expanded-D...
His book basically declares war on most other economists too: http://www.amazon.co.uk/Debunking-Economics-Revised-Expanded...
I'm very impressed but I'm always looking for counter arguments to my current understanding so if you know of any good critiques of his stuff I would be very interested.
