Reiterating Keynes and Segueing to Austrian Economics. A critique by Robert Skidelsky, Keynes’ biographer, of Joseph Stiglitz’s Making Globalization Work -- making it “fairer” for poor countries:
A critique byRobert Skidelsky, Keynes’ biographer, of Joseph Stiglitz’s Making Globalization Work -- making it “fairer” for poor countries:
However valid Stiglitz’s argument is in its own microeconomic terms, “the main problems of globalization lie in its uncontrolled macroeconomy…The relatively permissive attitude with regard to the so-called market failures displayed by the great 20th century economists Keynes and Hayek and their greater concern with the problem of securing macroeconomic stability, different though they set about it, are more relevant. They understood that uncertainty and the disappointment of expectation were inherent features of economic life. In Keynes’ economics, a loss of confidence, whatever its causes, leads to an increase in “liquidity preference,” or a flight from investment into money…This is happening today. The credit crunch in the US and the excess accumulation of reserves in East Asia are signs of an increase in liquidity preference. The need is to…provide a macroeconomic environment that reduces the chances of financial shocks that cause a flight into money.”
The New York Review of Books, April 17, 2008
(Skidelsky acknowledges comments by Paul Davidson)
Champion of von Mises in socialist calculation debate
Critic of Keynes: The Road to Serfdom
Founder of libertarian "Mont Pelerin Society"
Friedrich August von Hayek
Nobel Prize, 1976
Prices and Production (1931), in tradition of Wicksell’s monetary cycle theory:
Easy credit I forced saving C I
Expectations are disappointed.
What seemed like a good idea turns out to be malinvestment
Hayek’s prescriptions for stable money
1940s: Commodity reserve currency
1970s: Free banking competitive monies neutered central banks
individualistic anarchism -- an anti-state political philosophy
that attempts to reconcile anarchism with capitalism.
It advocates the elimination of the state; the provision of law
enforcement, courts, national defense, and all other security
services by voluntarily-funded competitors in a free market
rather than through compulsory taxation; the complete
deregulation of nonintrusive personal and economic
activities; and a self-regulated market.
"I grew up in a Communist culture," Rothbard recalls.
1926 - 1995
Man, Economy, and State, 1962
The Panic of 1819, 1962
America’s Great Depression, 1963
For a New Liberty: A Libertarian Manifesto, 1973
An Austrian Perspective on the History of Economic
Thought (2 volumes), 1995
Polytechnic University UNLV
von Mises Institute
laissez - faire … just prevent landslide
Recession: “The pause that represses”
1938 - 1991
Advisor, Theodore Schultz?
Human capital pioneer
Brunner - Meltzer / Sharpe - Pascal
WWII Shipbuilding Learning-by-doing
A “Radical” detour
Lucas - Rapping Supply Curve
Rand - Carnegie
Crotty-Rapping, 1975 CEA Report: A Radical Critique
UNLV - Brandeis
“Naïve pluralism”: the assumption of shared
interest in price stability and high employment
Progressive Policy Institute
Labor - capital conflict
Govts seek to maximize profits of major corporations
“Recession creates precondition for new expansion of profits”
International capitalist conflict
US as hegemon: maintain order, a la Kindleberger
$ as reserve currency dominance financed by printing money
Vietnam /collapse of Bretton Woods power vacuum
Macropolicies in defense of post-WWII system accelerated its demise
1974: The economy had to be purged.
Columbia University, 1957 - 1969
University of Chicago
Professor of Economics and Sociology
Extending the Indifference Map
Economics of Discrimination
Biases / ethnic preferences
Human Capital: Return to education
Gary Becker, 1930 -
Clark Medal, 1967
Nobel Prize, 1992
Allocation of time:
Time budget & Income budget
Cost of kids
Rotten kid theorem
Cost of divorce
Crime and punishment: a cost - benefit analysis
Organ donor market
Politics: Interest group conflict
Linear gain / Exponential Deadweight Loss Equil.
Doing the “right” thing may be wrong in an
Consumer Demand: A New Approach
People want attributes, not products.
1924 - 1999
Goods are complementary
inputs to household production.
J. B. Clark Professor at
Why not whole spectrum of offerings?
Increasing returns to scale
Intra-industry trade theory