Category Archives: Links

Advocates of Reason: 7 March 2014

Man has only one tool to fight error: reason.

Ludwig von Mises

1. What’s gone wrong with democracy?, asks the Economist. (For political scientists: is there a difference between “top-down” democracy and, say, “grassroots” democracy? I mean that in the sense of a planned democracy v. one that was both, in ways, planned and spontaneously developed.)

2. How unconventional are large-scale asset purchases?

3. The myth of the great wages “decoupling,” Don Boudreaux and Liya Palagashvili.

4. Coordination and the demand for money, Nick Rowe. It reminds me of Hayek, and Hoffman’s and Urbansky’s “Economic Order Displacements and Recurring Business Cycles.”

5. Reddit’s economic article of the week: “The Political Economy of the Rent-Seeking Society,” by Anne Krueger.

6. Can economic sanctions force Putin to retreat on the Crimea issue? Sanctions are an easy option to condemn, and to damage to, an aggressor, but, historically, they rarely work. Here is an old essay of mine on the unintended consequences of sanctions on Iran.

Advocates of Reason: 12 February 2014

Man has only one tool to fight error: reason.

Ludwig von Mises

1. One of my new day jobs: The Daily Confidential (TDC). It’s supposed to be a new competitor to Elite Daily (which I should start reading). I’m their new editor-in-chief, and my main task right now is raising the average quality of the writing. In these early stages, editing is turning out to be a very tedious task, as I have to make basic corrections that would otherwise (and typically) lead an editor to just reject the piece altogether. Economic Thought will probably take a hit in activity until the writers start making sure that most of the tedious, basic (spelling, grammar,…) errors are corrected before they submit their piece.

2. “Conflicting Views of the Entrepreneur in Turn-of-the-Century Vienna,” by Matthew McCaffrey.

3. Donald Boudreaux and Mark Perry, “The Myth of a Stagnant Middle Class.” The article does a good job showing how some statistics can be misleading, and how explaining them changes once you consider other factors.

4. Democracy and frats.

5. Welfare benefits as an automatic stabilizer. I don’t agree with “countercyclical” theories of welfare. I support some welfare for ethical reasons. I think that’s good enough, and that oftentimes it justifies the costs to welfare. But, if we want to make a “countercyclical” case, I prefer Hayek’s approach: governments should save during periods of healthy economic activity (does this work to shave excess liquidity, too?) and use those savings during recessions.

Advocates of Reason: 24 January 2014

Man has only one tool to fight error: reason.

Ludwig von Mises

1. This is over a year old now, but it’s the first time I’ve seen it: Chris Auld shows that Steve Keen, in his critique of Neoclassical price theory, botches both the theory and the math. I first read Keen’s Debunking Economics in the summer of 2012, and while I was initially taken by some of the arguments, and I enjoyed the chapters dealing with Sraffa, I thought his criticisms of basic price theory were weak. Ultimately, Steve Keen’s books is one of the major reasons I turned away from heterodoxy, and one of the reasons I stopped being as interested in Post Keynesian economics.

2. Robert Murphy’s latest post on the Krugman–Barro controversy has persuaded me that Krugman’s comment on Barro makes less sense than I originally thought.

3. James Canton digs through Prices and Production to show us that, no, Hayek did not support MV stabilization as a counter-cyclical policy.

4. Gene Callahan takes Mike Huemer to task. Huemer’s critique (or one of his critiques — I have not yet read his latest book) of the state is that it’s exempt from some of the moral principles we expect private agents to abide by. But, Gene shows that we make these distinctions of permissibility between people all the time.

5. If you enjoy the wonk of empirical minimum wage studies, I recommend going through the recent posts on Daniel Kuehn’s blog.

6. This is what currency devaluation looks like to the average person.

Advocates of Reason: 7 January 2014

Man has only one tool to fight error: reason.

Ludwig von Mises

1. Jeffrey Tucker and Cathy Reisenwitz, “The Feminism of Ludwig von Mises.”

2. Timon Singh, “Food Trucks Are Rapidly Replacing Traditional Fast Food Outlets in the U.S.” This is related to my post about the future of the automobile. One way to expand trade is to reduce transaction costs, and this is exactly what food trucks are doing. They’re making it cheaper for consumers to trade with them.

3. The adventures of Fallacy Man — or your average internet debate.

4. The two 2014 books I’m looking out for: Thomas Piketty’s Capital in the Twenty-First Century and Charles Calomiris’ Fragile By Design.

5. We don’t need to reform how we do economics, we need to reform how we teach it. Michael Tontchev is frustrated that his textbook didn’t explain the rationale behind an indifference curve’s convexity. Apparently diminishing marginal returns (and the marginal rate of substitution) are never explained.

Advocates of Reason: 21 December 2013

Man has only one tool to fight error: reason.

Ludwig von Mises

1. Critical Review publishes a symposium on Hayek. It includes an article by Daniel Kuehn on Hayek’s business cycle theory. I’ve been meaning to comment on the paper, but haven’t found the time yet.

2. Symposium on Elinor Ostrom in the Journal of Institutional Economics.

3. Very good Krugman post on the role of the blogosphere in the exchange of ideas.

Advocates of Reason: 18 November 2013

Man has only one tool to fight error: reason.

Ludwig von Mises

1. “What is an institution?,” by Alex Lenchner.

2.  “How to Speak and Write Postmodern.”

3. David Henderson explains what chained CPI means.

4. A good overview of the blogosphere debate on rational expectations (HT Noah Smith). I lean towards Simon Wren-Lewis’ and Mark Thoma’s positions.

5. John Carney discusses some recent research that questions the link between Fed policy and the stock market. Nelson Scwartz reviews the paper’s comments on the distributional effects of Fed policy.

6. What you have to do if you want to be denied a medical marijuana card in Los Angeles, California.

Advocates of Reason: 24 October 2013

Man has only one tool to fight error: reason.

Ludwig von Mises

1. The Uruguayan government is toying with the idea of selling marijuana at $1/g. Why this case would be any different from, say, the scalping “problem” associated with under-priced concert tickets, I don’t know.

2. Economies of scale and Britain’s industrialization.

3. Why has Somali oceanic piracy died off? Private security (I linked to another story earlier this year). The article mentions that “pirates” people looking for ransom money have begun to look for inland targets.

4. Matt McCaffrey reviews a recently published book on Edwin Chadwick, a 19th century English “utilitarian social reformer” whose economic insights are remarkably parallel to those of various modern economists.

5. “18 signs you’re reading a bad criticism of economics.” Unlearningecon is not impressed. I want to make my own list now.

Advocates of Reason: 17 October 2012

Man has only one tool to fight error: reason.

Ludwig von Mises

1. Tim Shenk offers us an interesting look into the life of Maurice Dobb.

2. Medieval monetary dynamics as a foil, by J.P. Koning.

3. Noah Smith: Fama is the Newton, as Shiller is to Einstein.

4. Richard Ebeling re-introduces us to a forgotten Austrian, Herbert Davenport. Having never read anything by, or even on, Davenport before, I am amazed at how “modern” his ideas sound (especially the role expectations play).

5. In a freshly published paper, Price Fishback and Joseph A. Cullen question the role of World War II expenditure in stimulating growth in the United States.

6. In the context of Greece’s Golden Dawn, Daron Acemoglu and James Robinson discuss extremism and democracy. Most chilling is how this extremism pollutes a country’s institutions. Why has this been rarer in the United States? Alvaro Vargas Llosa has a post at The Beacon on a similar topic.

Advocates of Reason: 11 October 2013

Man has only one tool to fight error: reason.

Ludwig von Mises

1. Renaud Fillieule, “A Comprehensive Graphical Exposition of the Macroeconomic Theory of Böhm-Bawerk.” I still have not read the paper; my intention is to post on it, even if it’s only a summary, when I do. Fillieule’s objective is to formalize and illustrate how Böhm-Bawerk’s theory of interest and capital offers a complete macroeconomic theory. If capital theory is your thing, this is the paper for you.

2. Peter J. Boettke and Kyle W. O’Donnell, “The Failed Appropriation of F.A. Hayek by Formalist Economics.” Boettke announced this working paper yesterday on his blog, and I spent much of the afternoon reading it. It’s very interesting and very informative. I do have a post in the works summarizing it — to the best of my abilities —, but also challenging one of the arguments in the paper: that it is the fault of formalism that some of the Austrian emphases in the problem of social coordination and knowledge are lost to non-Austrian scholars.

3. Having just bought a new car, and not being very well off, I’ve held back from purchasing books. Besides, I already have a lot of books, many of which I have yet to read. Nevertheless, I decided to splurge and buy Fred Foldvary’s Public Goods and Private Communities. I am very interested in the public goods problem, to a large extent because it serves as a segue into alternative institutional (i.e. non-pricing process) frameworks. My views on government are informed by my understanding of the public goods problem (and, more generally, the market failure problem). Foldvary, in a technical analysis, argues against the market failure interpretation, suggesting that entrepreneurs will find creative ways of providing these goods at a local level.

4. Somebody made a website dedicated to clarifying that the Nobel Memorial Prize in Economics is not really a Nobel Prize. The thing is, though, that nobody cares. My guess is that even the committee that awards the actual Nobel Prize don’t care either, because they still list the economics prize on their website. It’s time to get over it, and it’s time to get over the fact that sometimes the award will go to people who you think shouldn’t get the award. And, yes, I think it’s fair to believe that receiving a Nobel Memorial Prize in Economics just as prestigious to an economist as winning the Nobel Prize in Chemistry is to a chemist.

5. Gene Callahan on the intellectual relationship between Hayek and Mises. Note that in his early work on the knowledge problem, Hayek raises doubt over the ability of the “pure logic of choice” (praxeology) to explain what he sees as an empirical problem. But, Bruce Caldwell, in his intellectual biography of Hayek, suggests that this theoretical/empirical divide would continue to present a problem for Hayek. Hayek, in his later work, went on to argue that falsification for the macro problems he had in mind — problems of coordination and social order — is increasingly difficult, which seems to contradict his earlier statements (and seems to support a preference for micro-founded macro theory, which are extensions of the pure logic of choice).