I haven't written much lately. Even if I wrote, there were only a few lines to update the world that I am still very much alive (not really a case for today).
So I decided to write something today, to commemorate the day I placed the most expensive order on Amazon or elsewhere up until this point of my life yet apart from the massive amount I have put into the UK education system. The purchase reminds me of a concept most people in the finance world have heard about - Hicksian economic income.
We, accountants/or at least what we call us for now, are doing the work we call (again) income measurement. Yet, can income be measured? Even further, what is income? This is where Hicksian economic income steps in and states that income is the maximum amount we can consume today in anticipation of the future cashflow. This has led to another horizon of "income", whose income the accountants are trying to measure these days? A lot of questions and debates have been thrown out but not much taking back; and even the answer is somewhere out there among us...
For now, let's have a look at a more practical and micro situation, my order. I, at least, feel less guilty with the knowledge of the certainty of the future cash flow will come in shortly at the end of October. Thereby, the concept holds at least for now (hopefully!).
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