Thousands of important and intelligent men have never been able to grasp the principle of comparative advantage or believe it even after it was explained to them
Interpretation
The quote highlights how many intelligent individuals fail to understand a fundamental economic principle.
Paul Samuelson's quote emphasizes the challenge of comprehending the principle of comparative advantage, which states that individuals or nations can benefit from trade by specializing in the production of goods in which they have a lower opportunity cost. Despite its importance and utility in economics, even highly intelligent people struggle to grasp this concept fully, indicating that understanding economic theories often requires more than just intelligence; it requires a particular mindset and willingness to analyze and accept complex ideas.
In practice
In an economic lecture about trade theory.
To a person of analytical ability, perceptive enough to realise that mathematical equipment was a powerful sword in economics, the world of economics was his or her oyster in 1935. The terrain was strewn with beautiful theorems begging to be picked up and arranged in unified order.
I can't think of a president who has been overburdened by a knowledge of economics.
My belief is that nothing that can be expressed by mathematics cannot be expressed by careful use of literary words.
Politicians like to tell people what they want to hear - and what they want to hear is what won't happen.
My family was well off but not rich. I spent the four years I was an undergraduate working on the beach. And it wasn't because I was lazy; it was because my freshman class would go to a hundred different employers and wouldn't get a nibble. That was a disequilibrium system. I realized that the ordinary old-fashioned Euclidean geometry didn't apply.
Economics has never been a science - and it is even less now than a few years ago.
If we wait until income inequality is much more severe, we will have a whole class of new superrich who will probably feel entitled to their wealth and will have the means to defend their interest. That's already gone far enough. We shouldn't let it become more extreme.
Measures which serve to abridge the free competition of foreign Articles, have a tendency to occasion an enhancement of prices.
Economic systems are not value-free columns of numbers based on rules of reason, but ways of expressing what varying societies believe is important.
Inflation is not caused by the actions of private citizens, but by the government: by an artificial expansion of the money supply required to support deficit spending. No private embezzlers or bank robbers in history have ever plundered people's savings on a scale comparable to the plunder perpetrated by the fiscal policies of statist governments.
There is slow growth, but it is positive slow growth. At the same time, ratios of debt-to-incomes go down. That's a beautiful deleveraging.
During the two centuries since the publication of 'The Wealth of Nations,' the main activity of economists, it seems to me, has been to fill the gaps in Adam Smith's system, to correct his errors and to make his analysis vastly more exact.
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