[pdonis]

> (very) roughly speaking, being able to produce more output with the same input

It's not just physical output, though. Ultimately the purpose of all of this economic activity is to meet human needs or wants. But outside of basic subsistence, most human needs and wants can be highly variable in how much physical output can satisfy them. For example, humans have a need/want for movies and music. It used to require a lot more physical output to satisfy those needs (having factories to make tapes, CDs, DVDs) than it does now (pushing bits over the Internet). The real benefit of technological process is not just getting more physical output with the same input; it's figuring out how to satisfy more (in some cases much more) of people's needs and wants without increasing physical output.

[chobeat]

The current production system is driven by the need for growth. What you're describing was true maybe until a century ago, until the 1929 crisis. After that it was clear that demand had to be artificially stimulated to meet the needs of the production side. First it was war, then mass consumerism. Desires are not natural, they are induced and in the same way they are induced (socially, culturally, politically), they can be removed, usually with a higher level of happiness for the people involved.

[pdonis]

> The current production system is driven by the need for growth.

I would say our current monetary system is driven by the need for growth. But our current monetary system is a political tool, not an economic tool.

> After that it was clear that demand had to be artificially stimulated to meet the needs of the production side.

No, what was clear, at least to anyone who hadn't drunk the kool-aid of Keynesian "economics", was that the US government (and other governments weren't much better) was completely clueless about how economics actually worked, and so its interventions were making the depression worse instead of better. (Btw, this was just as true of Hoover's administration as of Roosevelt's.) All of the talk about having to increase "aggregate demand" was just a manifestation of the cluelessness. The real problem was not lack of demand but mismatched supply and demand: the government's messing with the money supply had led to a massive misallocation of resources, so that many things were being produced that nobody wanted and many things that lots of people wanted or needed were not being produced, or not being produced in sufficient quantity. Whenever that happens there will end up being a crisis when the misallocation can no longer be sustained.

What the US government should have done in response to the stock market crash of 1929 was...nothing. That's what the US government did in response to stock market crashes in 1920-1921 and 1987, neither of which led to a prolonged depression or even recession.

> Desires are not natural

Really? My desire for music and movies is not natural? How about my desire to post on a site like this one?

I think you have a very simplistic view of both economics and human desires.

[uhuruity]

Right, I agree completely. By 'output' I suppose I meant goods and services that provide utility to humans.