DISQUS

I can't believe no one has mentioned Keynes' General Theory book. I'd ban that one. Also, I would be on board with banning any book advocating socialism, or any other form of collectivism.

I hope cato decides to bundle this debate into the next cato journal. It would be wonderful to have this all in one place and in portable print form. Regardless, I am going to make a point of reading this debate. Thanks for the links Will.

Will,

I know you're a thoroughgoing Hayekian so I thought I would point you to a very interesting essay I read recently. Though, you may have already read it. The essay is taken from a 1990 issue of The Review of Austrian Economics and was written by Joseph Salerno. Salerno introduces many Hayekian ideas, like those of "spontaneous" or "undesigned" order and the price system as "the use of knowledge in society", and then proceeds to contrast them with the views of Ludwig von Mises. Although the differences seem fairly subtle, I think the potential implications are great. Again, I read it and figured I would point Hayekians to it as the essay presents an interesting critique to some of Hayek's ideas. It's titled Ludwig von Mises as Social Rationalist. Linked below.

http://mises.org/journals/rae/pdf/R4_2.pdf


ps. I hope all goes well with the move and that you both have a safe trip!

Thanks!!

I thought your discussion with Professor Prinz was fascinating. Listening to your Free Will podcasts and reading your blog has ignited an intense interest in philosophy and how it strives to interpret our beliefs, customs, and actions. Unfortunately I'm relatively unfamiliar with philosophy (major works, top thinkers, etc). Other then a 100 level survey course at my university I know nothing of the wider discipline. I have read Hayek, Mises, and a few other social philosophers extensively but I'm now looking to branch out further. Could you possible recommend a sort of starter kit of books and articles that would serve as a useful introduction? I would really appreciate it as your discussions have made learning these concepts appear all the more important. At least to me. Thanks!

Although I'm doubtful that this stuff you mention (happiness, meaning, intensity of devotion, etc) can be measured at all, I really admire your eagerness to attempt to develop a method to measure it. Good luck, I hope you accomplish a reliable way to do this, if it's at all possible.

"If you dammed up a river, then found you had too little water downstream, and so released a bit of water from the dam, you could think of it as “importing more water.” Or you could think of it, more accurately, as removing the artificial barrier to supply."

So you're for the complete dismantling of all our immigration restrictions and barriers? That is the true liberal position. It makes no sense that we, as Americans, should have sole purview over this extensive territory from merely having the great fortune of being born here.

Muirgeo, that is a fair critcism. Personally, I have read at least one book that attempts to spell out what libertarianism is about--Ludwig von Mises' book Liberalism. You can probably find it free online at the mises institute site. Libertarianism, to me, is essentially no different in its goals than that of classical liberalism, or what was derided by interventionists and socialists as "Manchesterism".

I don't think libertarianism is necessarily anti-democratic like you said. Most (if not all) libertarians believe that democracy is the form of government most compatible with libertarianism as it allows all members of the state to have some sort of say in how it should be managed. The hostility to democracy that you probably percieve must be contextualized against our present democracy. Interest group politics is inherent to democracy; there will always be seperate groups striving to control the state and use it to enact what they deem desirable. The goal is to establish certain limits on how large the state can become, and thereby limit the power and resources that the interest groups can control once they are in charge of the state. To be sure, it's not an easy thing to achieve in that the natural incentives facing the state will always be for it to grow (in terms of power and resources that it controls) and to perpetuate itself. But the goal should be to establish a government that has as little intervention within the market economy and one that has the most limited restrictions on the use of a person's private property.

Mises' works are peppered with how liberalism would work in the real world, and his scientific contributions to economic theory and social philosophy not only indicate that liberalism is possible, but that it is more desirable than any other socio-political system because of its beneficial consequences for liberty and freedom. Read the classical liberals and read Mises. I bet much can be gained from Hayek too, though I am less familiar with his writings than I am with those of von Mises.

I just started reading your blog and, I must say, I'm really impressed. Each post has been very thought-provoking. You're definately different than the Yglesiases of the blog world.

Also, I listened to your conversation with Bruce Caldwell and thought it was a superb introduction to the ideas of F.A. von Hayek. You two guys did a wonderful job conveying the continued relevence of much of his work, and the conversation led me to buy Dr. Caldwell's book.

Greg, this is a very interesting and thoughtful post and I'm happy you solicited my take on what you're discussing here. If I understand correctly, you're saying that with a potential economic recession looming and the consumer confidence numbers trending downward, that marketers must dream up some new way of communicating with their customers, telling them it's OK to actually go out and buy afterall. It's an interesting viewpoint, but reading s0me of what you wrote demonstrates that you don't understand the underlying phenomena of a recession.

The portrayal of Recession as a sort of Bogey that everyone must fear is misleading I feel. Essentially what a recession is--and it's an absolutely necessary aspect of the cyclical pattern of business's adoption of innovations (ie. new ways of doing things)--is the liquidation of untenable business enterprises. What I mean of course, is that during the boom phase (think recent tech boom of the 90s) of any prosperity you have many new businesses coming into existence. The information/data that each of these entrepreneurs are utilizing to make their profit projections are usually misleading--they see past profit rates of increase and then extrapolate that going forward, sometimes ad infinitum. Of course these profit projections are not sustainable or realizable, and here, once people begin to realize the untenableness, we see the liquidation of these unsustainable enterprises (again, think tech boom, then the subsequent bust where many e-companies failed). So in its basest form, recession is the liquidation of untenable enterprises that were created during previous boom periods. And, your 6th bullet point about inflation could not be further from the truth during times of recession. Recession actually includes a process of DEFLATION. If you can just reimagine the example of the 90s tech boom/bust, you can understand that when a company or companies go poof--out-of-business--you have the evaporation of the paper wealth that goes along with it. This elimination results in fewer $$$ in circulation, which then results in the increase in the purchasing power of each monetary unit in the economy. So, recession exhibits a period of price deflation (things are cheaper in real terms at least), liquidation of unsustainable businesses, temporary surges in unemployment(which I neglected to mention more fully).

I think the idea that the consumer somehow drives the economy is also misleading. The idea was born out of the Keynesian aggregate demand arguments of the early 20th century, which still persist to this day, but surely you'd have some reservations about adopting it. I'm sure that you're aware of the many instances of products being created without a customer base in mind--in many instances in the past the demand for a product had to be created! The role of Marketers in this instance was first to educate the consumer of the benefits of using the product and then why it would be more convenient to do so. Sometimes persuasion was/is the best method of developing a consumer base for a product--regardless it's a stark difference from the idea that somehow consumers plead for a certain product to be produced, then a company steps in to fill that void. So, in short, consumer confidence surveys can be misleading, and certainly they are not accurate indicators to the overall economic climate. It's more like a indicator of the present fear/apprehension resulting from media reports, or whatever.

Anyway, I thought the post was interesting, but overall I wouldn't be worried about consumer confidence surveys or the so-called Recession (no one even knows if we're in one anyway).

Ryan