Wednesday, January 29, 2014

Boudreaux on Wealth As Dough

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From the article:

In fact, relatively rich people do not have their wealth stored as large globs of homogenous dough-wealth.  Their wealth, instead, is invested mostly in the risky creation and maintenance of capital goods and services – that is, it is invested in specific capital goods and services – and it is, therefore, quite unable to be transferred from its current forms into consumer goods for poorer people without both reducing its value and reducing the economy’s prospects for growth.

Source:  Don Boudreaux, "Wealth Is Not a Glob of Homogeneous Dough," cafehayek.com, January 28, 2013

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