The Central Planning Elephant in the Room
Roberts and Papola have done it again: a rap video that explains the divergent views of two of the most prominent economists of the 20th century. It’s better than most textbooks, and entertaining to boot. It’s “Fight of the Century.” The video is a fo …
READ MORE“An Austrian Rehabilitation of the Phillips Curve” – Cato Journal
“William Niskanen (2002) estimated a Phillips curve for the United States using annual 1960–2000 data. By adding one-year lagged terms in unemployment and infl ation, he was able to show that this familiar equation is misspecified. In his improved specifi …
READ MOREA Tiger by the Tail – Hayek
“F.A. Hayek said that his biggest regret in a lifetime of writing was that he never wrote a book-length refutation of Keynesian economics. He seriously doubted that Keynesian style planning would ever captivate governments, so he focused on different t …
READ MOREHayek On Deflation – Coordination Problem
Over on the Coordination Problem blog, a number of scholars in the field of monetary theory are having an interesting discussion on the topic of Hayek and deflationary spirals. I am providing the link. I recommend a thorough reading of the comments. Th …
READ MOREWhen Low Inflation is Too High
Milton Friedman famously stated, “Inflation is always and everywhere a monetary phenomenon.” In other words, whenever you see persistent, high inflation, you know the cause was too much money. When too much money is chasing the same amount of goods, as …
READ MOREWhere Did the Free Banking Debate Go?
The discussion in monetary institutions is becoming increasingly relevant in economics. How to deal and avoid financial crisis is an important issue. The recent financial crisis showed that economics might not be as suited to foresee and deal with thes …
READ MOREProsperity and Depression – Harberler
“Are you serious about business cycle theory? In 1937, back when economists thought big and coherent thoughts about the boom-bust cycle, long before mainstream economists began to doubt the existence of theoretical universals, Professor Gottfried Haber …
READ MORE“Inflation and You” – Ludwig von Mises
“The first fact that needs to be noted in answering such questions is that inflation is detrimental to all creditors. The higher prices rise, the lower will fall the purchasing power of the principal and interest payments due. The dollar which was loan …
READ MOREThe Legacy of Milton Friedman – Ben Bernanke
“Friedman’s emphasis on avoiding monetary disruptions arose, like many of his other ideas, from his study of U.S. monetary history. He had observed that, in many episodes, the actions of the monetary authorities, despite possibly good intentions, activ …
READ MOREWas Gold Standard too Expensive?
There are two main reasons usually mentioned to prefer fiat money over gold standard. One is that fiat money offers more flexibility to do fine tuning on the economy and also central banks will have their hand free if they need to go into a monetary st …
READ MORE“Same Old Song and Dance” – FEE
“Friedman, as with the other papers that day, found inflation to be a massive problem. In fact, next to the threat of a third world war, inflation is what he finds to be the most serious threat to the preservation of a free society. Friedman believed t …
READ MORE“Making Sense of the Controversy” – FEE
“The Foundation for Economic Education’s goal from the very beginning was to promote, what Leonard E. Read called, the freedom philosophy. Understanding the principles of economics is a crucial step to understanding why freedom works. The tools of econ …
READ MORE
