In “Monetary Theory and the Trade Cycle” Hayek holds that the business cycle is caused by fractional-reserve banking, which is a natural credit organization formed out of the market. If this is the case, then it follows that economic cycles are an intrinsic part of capitalism.
Posts Tagged ‘One’
Taxes Discourage Production
A chapter from Henry Hazlitt’s “Economics in One Lesson”. Hazlitt explains why taxation will discourage investment and production, disallowing new jobs from being created and perpetuating unemployment.
Shift to Keynesian Economics
My comment on Paul Krugman’s latest blog post (Why Economics Is the Way it Is):
Dear Dr. Paul Krugman,
You are only partially correct. The shift in mentality (for the United States), I believe, came during the First World War. This war, save the American Civil War, was the first war in which the economy was first [...]