1 Some Initial Assumptions  Anthropological Basis of Work  The Attainment of Well-Being as the End of Economics  The Essence of Economic Activity  Money  Wealth, Poverty and Equality  Sources of Wealth  Consumption, Property and Investment Source: Yepes, Ricardo Stork (1996) Fundamentos de Antropología. Ediciones Universidad de Navarra, S.A. (EUNSA). Capítulo 13. pp

2 Anthropological  Each person is composed of body and spirit: 1. A person is more than a genetic composition. 2. Economic life forms part of culture. But culture is not only economic life

3  Without the satisfaction of basic human needs, man cannot live 1. Specific biological make- up of each person is the cause as to why these needs have to be addressed Anthropological

4 2.Man’s corporal and instinctive needs can be satisfied in many different ways  Freedom is key in order to achieve it in many different ways  Man uses his intelligence in order to satisfy these needs and instincts. Anthropological

5 3.The person has more needs than the recourse in order to satisfy them  Reason: initial biological needs and the intellectual faculties which enables the person to propose to oneself ends which are not strictly organic Anthropological

6  The satisfaction of basic needs are those needs which refer primarily to our corporal condition. – The resources which can be used to satisfy these needs are scarce – Search for means to satisfy them. – Economics, precisely, deals with applying the art and technique of using scarce resources or means to satisfy needs – Basic needs: nutrition, clothing, living or shelter Anthropological

7  Conclusion: 1. Economics is a peculiar characteristic of being human. The person’s reason and will is manifested in how he is able to satisfy needs 2. Economics is based on work. How he makes use of scarce resources to satisfy present and future needs through technique. Anthropological

8  From here, we see the context of the other topics: – Well-being as the motor of economics – Technique of managing scarce resources and the production of goods – Achieved through the use of money: exchange and store of wealth – Nature of this scarcity – Sources of wealth – Economic activity related to consumption – Centrality of work in developing economic institutions such as the market and the firm Anthropological

9 The Attainment of Well- Being as the End of Economics  There is a natural inclination for each person to seek something which is strictly more than what is indispensable in order to live. Each individual has needs which goes beyond what is merely organic.  That which is more than organic is what we call well-being.

10  One does not simply live, but has to be living well through the development of one’s spirit, his culture. Go beyond the requisites of one’s minimum subsistence: use of one’s reason.  Explanation for luxury: go beyond minimum subsistence.  What is proper of economics, therefore, is to respond to the impulse which brings one to the humanization of the material conditions of life. The Attainment of Well- Being as the End of Economics

11  Resources will always be scarce otherwise no sense to study economics  Central problem of economics in society is how to reconcile the conflict between needs and unlimited desires, and, the scarcity of resources (land, labor and capital) necessary to produce these needs. Have to apply the principle of economics: Achievement of maximum utility at the minimum cost. (Market or technical efficiency).  Scarcity is an initial and constant situation. Deliberation and decision. Account for the means. The Essence of Economic Activity

12  Economics is therefore primarily mathematical, not because it is rigorous and exacting, but because it has to account as to how far resources can be used.  Practical science-resolves problems making an account of the use of scarce resources  Theoretical science-study of the behavior of economic agents and the results of such The Essence of Economic Activity

13 The Essence of Economic Activity  True and primary economics is that which looks at each person privately as well as each one being an economic agent. Many facets.  Human work multiplies these scarce resources. This makes production the principal economic activity

14 – Professional view of production – All the dynamics of business activity is based on work as a factor which creates wealth and moves the economy. Business is that particular type of production activity which is obtained from the spontaneous harmony of distinct wills dictated by reciprocation or mutual interest. – Introduce a product: create it and put in into the free market The Essence of Economic Activity

15  Under this focus, economics becomes a fountain of wealth based on human creativity – When a product is put into the free market, one can have both dispositions of interest and benevolence. – They are complementary, not contradictory – Adam Smith’s intrinsic goodness of man refers to the fact that man can give in a benevolent manner while at the same time taking care of his own proper interest. The Essence of Economic Activity

16 The Essence of Economic Activity  What is natural in man is love- giving oneself as well as obtaining what is lacking, or love-necessity. Love-necessity is not acquiring what we lack, at the cost of removing the love-giving which is as natural and necessary as the former.

17 Money  Functions of Money: Exchange, Fixed Unit of Account, Store of Value, Unit for Deferred Payments  An important means to achieve well- being. Thus, it is only a means.  When money is valued for its own sake, a person falls into the error of valuing things only from the point of view of results

18 Wealth, Poverty & Equality  Misery is not equal to poverty. Both refers to the inability of a person to achieve not only basic necessities but also those goods proper of the spirit. Real misery happens when life is valued only in terms of material possessions and one does not have it  It is possible to eradicate poverty but it may be difficult to eradicate misery in a consumerist society  Best source of wealth is human creativity. This is an economic fact. Human capital is an accepted economic concept