There are those who glory in this capitalism thing for the ability it gives them to appropriate the surplus value of the workers’ labour. There are also those who more cheekily point out that the glory of this capitalism thing is that it allows the workers to appropriate some of the surplus value of the use of others’ capital. But to me the real glroy of this capitalism thing is that it makes things cheap.

ON New Year’s Day, 1985, the first mobile call was made from a 2lb “brick”. Today, 25 years on, 60 per cent of us own a handset.

Yes, the mobile phone started out as a near joke for the conspicuous consumption classes. A Veblen Good for most users. But a mere quarter of a century later 28% of Africans have such a cell phone: providing telecommunications to that continent for the first time ever. 500 million Chinese are signed up with just one mobile operator. We can even see the effect of such telecoms on growth rates: one paper insists that a rise in 10 per 100 of a population getting mobiles leads to a 0.5% increase in GDP growth. There shouldn’t be any surprise at such a finding, historical research shows that the wiring up of the advanced countries with landlines had a similar effect.

How this works is shown by the study of the fishermen in Kerala. The academic paper on this shows that the incomes of the fishermen went up, the average price to consumers of fish went down and the amount of discards decreased. That is, everyone was richer through an increase in economic efficiency.

It’s that combination of capitalism and markets that drove the price of phones and minutes down and it’s the application of the new technology that has led to such oddities as increasing the incomes of sardine fishermen off India.

A thought for the New Year: aren’t we lucky to be living a couple of hundred years after people first worked out this one economic system that provides, uniquely, a constant, appreciable and consistent rise in the standard of living of the average schmoe? For that is the glory of capitalism.