A Response To The Skeptical Economist

I am currently reading the book "The Skeptical Economist," authored by Jonathon Aldred. So far I've discovered numerous errors in his various arguments, on which I will make responses.

The first error that caught my eye can be found on page 57. Mr. Aldred cites a survey of Harvard students. In this survey, the students were asked two choose between two economies in which to chose to live. In economy A, you have an income of $50,000 whilst the average income is $25,000. In economy B, you have an income of $100,000 while the average is $250,000. Majority of the Harvard students selected economy A. Mr. Aldred contends that this is do to a rivalry situation where people will have a tendency to want to be in a better relative position that others. This looks like a sufficient argument at the superficial level. However, if we delve into the situations presented in economy A and economy B we can find a different response.

In economy B, you are making 2.5 times less than the average income. This is in contrast the Economy A where you are making twice than the average income. Basically, in economy A you are wealthy, and in economy B you are in poverty. Rationality dictates selecting economy A. Furthermore, the $100,000 you would make in economy B is more than likely worth less than the $50,000 you would be in economy A. Economy B is a wealthier economy than A, as dictated by average incomes. Therefore, prices in B will more than like be higher than those in A. Therefore, you purchasing power in B, with the $100,000, would more than likely be less than that of the $50,000 in A.