Coordination Problem

Milton Friedman's Student Notes From Viner's Economic Theory Class

|Peter Boettke|

Irwin Collier at Economics in the Rear-View Mirror continues to provide treasures from the archives.  Recently he posted material from Milton Friedman's student days.  It is fascinating to look at what Viner expected his students to read for his class.

[Handwritten notes by Milton Friedman]

Assignments given by Viner in 301, 1932

Marshall Bk III ch 3 + 4; Bk V ch 1 + 2

[Alfred Marshall, Principles of Economics (London: Macmillan and Co. 8th ed. 1920).
Book III: On wants and their satisfaction.
Chapter 3: Gradations of consumers’ demand;
Chapter 4: The elasticity of wants.
Book V: General relations of demand, supply and value.
Chapter 1: Introductory. On markets;
Chapter 2: Temporary equilibrium of demand and supply.]

Schultz Meaning of st[atistical] de[mand] cur[ves] pp 1-10; 25-41.

[Henry Schultz. Statistical Laws of Demand and Supply with Special Application to Sugar. Chicago: University of Chicago Press. 1928. 118 pages]

Mars[hall] Bk V ch 3, 4, 5, 12; App H

[Book V: General relations of demand, supply and value.
Chapter 3: Equilibrium of normal demand and supply;
Chapter 4: The investment and distribution of resources;
Chapter 5: Equilibrium of normal demand and supply, cont., with reference to long and short periods;
Chapter 12: Equilibrium of normal demand and supply, cont., with reference to the law of increasing returns.
Appendix H: Limitations of the use of statical assumptions in regard to increasing return.]

Viner Cost Curves […]

[…and Supply Curves, Zeitschrift für Nationalökonomie. Bd. 3, H. 1 (1931), pp. 23-46]

Cunynghame “Geometrical Political Economy”, ch. 3

[Henry H. Cunynghame. A Geometrical Political Economy: Being an Elementary Treatise on the Method of Explaining Some of the Theories of Pure Economic Science by Means of Diagrams, Oxford at the Clarendon Press. 1904.
Chapter 3: Demand curve.]

Smart, Introduction to theory of value pp. 64-83

[Smart, William (1891). An Introduction to the Theory of Value on the Lines of Menger, Wieser, and Böhm-Bawerk. London and New York, Macmillan and Co. 1891.
Chapter 12: Cost of production;
Chapter 13: From marginal products to cost of production;
Chapter 14: From cost of production to product;
Conclusion.]

Böhm-Bawerk:

“Ultimate standard of value”, Annals of Am[erican] Academy Sept. [sic] 1894

[Eugen von Böhm-Bawerk. The ultimate standard of value. American Academy of Political and Social Science, Philadelphia. Publications, no. 128. June, 1894, 60 p.]

“One word more on ult. st. of v. [ultimate standard of value] E.J. Dec. 1894

[Eugen von Böhm-Bawerk. One word more on the ultimate standard of value. Economic Journal, Vol. 4, No. 16 (Dec., 1894), pp. 719-725.]

Marshall Bk V, ch 6; Bk V, ch 14

[Book V, ch 6: Joint and composite demand. Joint and composite supply.
Book V, ch 14: The theory of monopolies.]

Viner JPE. 1925 pp 107-111 (objective test of comp.[etitive] price appl[ied] to cem[ent] ind[ustry])

[Jacob Viner, Objective tests of competitive price applied to the cement industry. Journal of Political Economy, Vol. 33, No. 1 (Feb., 1925), pp. 107-111.]

J.S.Mill “Outline of Pol. Economy” Bk II, Ch 11, sec 1; Bk I, ch VI, sec 1

[Note: Outline of Political Economy is the title of Nassau Senior’s book.
John Stuart Mill, The Collected Works of John Stuart Mill, Volume II – The Principles of Political Economy with Some of Their Applications to Social Philosophy (Books I-II), ed. John M. Robson, introduction by V.W. Bladen (Toronto: University of Toronto Press, London: Routledge and Kegan Paul, 1965).
Book II, ch XI, sec. 1: Distribution. Of wages.
Book I, ch VI, sec. 1: Production. On circulating and fixed capital. ]

Henry George, “Progress + Poverty” Bk I, ch 1,3,4

[Henry George, Progress and Poverty: An Inquiry into the Cause of Industrial Depressions and of Increase of Want with Increase of Wealth, The Remedy (Garden City, NY: Doubleday, Page, & Co. 1912).
Book I: Wages and Capital.
Chapter 1: The current doctrine of wages–its insufficiency;
Chapter 3: Wages not drawn from capital, but produced by labor;
Chapter 4: The maintenance of laborers not drawn from capital.]

F.W. Taussig, Principles, vol II, ch 39, 51

[Frank W. Taussig, Principles of Economics. 2nd revised edition. 2 vols. (New York: Macmillan). 1915. Note: a later 3rd revised edition from 1921 has a chapter 51 “Great fortunes” that does not appear as good a fit to this course’s content, so I conclude the reference is to the second edition.
Chapter 39: Interest, cont. The equilibrium of demand and supply;
Chapter 51: General wages.]

J.B. Clark “Dist[ribution] of Wealth”, ch 1, 7, 8, + Preface

[John Bates Clark, The Distribution of Wealth: A Theory of Wages, Interest and Profits (New York: Macmillan). 1899.
Chapter I: Issues That depend on Distribution;
Chapter VII: Wages in a Static State, the Specific Product of Labor;
Chapter VIII: How the Specific Product of Labor may be Distinguished.]

F.A. Walker, Political Economy P[reface] + IV, ch 4,5,8 + V [sic, should be VI], sec 5

[Francis Amasa Walker, Political Economy (London: Macmillan) 3rd revised and enlarged edition. 1892.
Part IV: Distribution.
Chapter 4: Profits;
Chapter 5: Wages;
Chapter 8: The reaction of distribution upon production.
Part VI: Some applications of economic principles.
Section V: The doctrine of the wage-fund.]

A. Smith Bk I, ch 10

[Adam Smith An Inquiry into the Naature and Causes of the Wealth of Nations, Edwin Cannan, 3d. London: Methuen & Co., Ltd. 5th edition, 1904.
Book I, Chapter X: Of wages and profit in the different employments of labour and stock.]

J.S. Mill Bk II, ch 14

[Book II, ch 14: Distribution. Of the differences of wages in different employments.]

Cairnes “Polit. Econ”, P[reface] + I, ch 3 [art.] 4,5

[J.E. Cairnes. Some Leading Principles of Political Economy Newly Expounded. New York: Harper & Brothers, Publishers. 1874.
Part I: Value.
Chapter 3: Normal value]

Taussig Principles, ch 47

[Chapter 47: Differences of wages. Social stratification.]

J. B. Clark Ch 9, 13

[Chapter IX: Capital and Capital-Goods Contrasted;
Chapter XIII: The Products of Labor and Capital, as Measured by the Formula of Rent]

Böhm Bawerk Bk 2, ch 1-5; Bk 5, ch 1-4; Bk 6, ch 1,2,4,5,6; Bk 7, ch 1,2

[Book II: Capital as instrument of production.
Chapter 1: Introductory;
Chapter 2: Capitalist production;
Chapter 3: Historical development of the conception;
Chapter 4: The true conception of capital;
Chapter 5: The competing conceptions of capital.
Book V: Present and future.
Chapter 1: Present and future in economic life;
Chapter 2: Differences in want and provision for want;
Chapter 3: Unerestimate of the future;
Chapter 4: The technical superiority of present goods.
Book VI: The source of interest.
Chapter 1: The loan and loan interest
Chapter 2: The profit of capitalist undertaking. Principles of explanation.
Chapter 4: The profit of capitalist undertaking. The labour market;
Chapter 5: The profit of capitalist undertaking. The general subsistence market;
Chapter 6: The profit of capitalist undertaking. The general subsistence market (continued).
Book VII: The rate of interest.
Chapter 1: The rate in isolated exchange;
Chapter 2: The rate in market transactions.]

Marshall Bk VI, ch IX

[Book VI: The distribution of the national income.
Chapter 9: Rent of land.]

Ogilvie Marshall on Rent Econ J. 1930

[F.W. Ogilvie. Marshall on Rent. Economic Journal 40 (March) 1930: 1-24]

J.B. Clark ch 23

[Chapter XXIII: The Relation of All Rents to Value and Thus to Group Distribution]

Source: Hoover Institution Archives, Milton Friedman Papers Box 5, Folder 12 (Student years)

______________________

[typed list of reading assignments]

Assignments in Viner’s Economics 301
(In order of assignment)

Marshall, Bk III, ch. 3, 4; Bk V, ch. 1, 2

Böhm-Bawerk, Positive Theory of Capital, Bk IV, ch. 4

Schultz, Meaning of Statistical Demand Curves, pp. 1-10, 25-41.

Marshall, Bk. V, ch 3, 4, 5, 12; App. H

Viner, Cost Curves [and Supply Curves, Zeitschrift für Nationalökonomie. Bd. 3, H. 1 (1931), pp. 23-46]

Cunynghame, Geometrical Political Economy, Ch. 3

Smart, Introduction to the Theory of Val., pp. 64-83

B. B. [Böhm-Bawerk], Ultim. Stand. of Val., Ann. of Am. Ac., Sept. 1894

One word More on Ult. S. of V., Econ. Jour., Dec 1894

Marshall, Bk. V, ch. 6; Bk. V, ch. 14

Viner, Objective Tests of Comp. Pr. appl. to the Cem. Ind. JPE, ‘25

J.S. Mill, Outline of Pol Ec. [sic, Principles of Political Economy], Bk II, ch. 11, sec. 1; Bk I, ch. 6 sec. 1

Henry George, Progress and Poverty, Bk I, ch. 1, 3, 4.

F. W. Taussig, Principles, Vol II, ch 39, 51.

J. B. Clark, Distr. of Wealth, ch. 1, 7, 8, preface.

F. A. Walker, Pol. Ec., Part IV, ch. 4, 5. Part VI, Sec. 5

Adam Smith, Bk. I, ch 10

J.S. Mill, Bk II, ch. 14

Cairnes, Pol. Ec., Part I, ch. 3, arts. 4, 5.

Taussig, ch. 47

J. B. Clark, ch. 9, 13

B.B. [Böhm Bawerk], Bk II, ch 1-5; Bk V, ch 1-4; Bk. VI, ch. 1, 2,4,5,6; Bk. VII, ch. 1,2.

Marshall, Bk. VI, ch. 9

Ogilvie, Marshall on Rent, Econ. Journ., March, 1930

J. B. Clark, ch. 23

Source: Hoover Institution Archives, Milton Friedman Papers Box 115, Folder 13 (Class Exams circa 1932-1938)

Image Source: University of Chicago Photographic Archive, apf1-08490, Special Collections Research Center, University of Chicago Library.

Look how much Bohm-Bawerk was on that reading list.  In the Buchanan archives, one can find a similar set of notes -- from 1946 -- by Buchanan and the typed reading list that was expected of all PhD students at Chicago.  Not only is Bohm-Bawerk still a presence in the common core of theory, but so was Wicksell, Wicksteed, Mises and Hayek.

Given the exposure to these ideas that Friedman had as a student, and Buchanan had as a student, it is puzzling as to the opposite reaction both had to grappling with Austrian ideas about subjectivism, the economic interaction process, the price system and even industrial fluctuations.  Friedman as a diligent student was required to read through Bohm-Bawerk's capital and interest theory as well as Bohm-Bawerk's value and price theory presentations.  So how could Hayek's presentation of array of relative prices impinging on the arrangement of productive assets in an economy present any sort of mystery to him?  As Buchanan pointed out in his essay "On Hayek", which was written in 1979, but we are publishing in a forthcoming issue of the RAE, Hayek's theory of the trade cycle was a microeconomic theory, a price theoretic theory, an economic theory worthy of that name.  There are of course points of agreement and disagreement, but there is no denying it is a relative price theory story, and it should not be mysterious to any trained Chicago price theory economist.  It makes much more sense that the theory should be viewed as mystical to a Keynesian economist --- if the price system is broken, then you cannot look to the price system for the explanation or the solution.  Thus, as Keynes put it, Hayek's Prices and Production was "an extraordinary example of how, starting with a mistake, a remorseless logician can end up in bedlam ..."  Compare that to Armen Alchian's discussion of Prices and Production in his interview with Hayek, and how important Alchian thought the emphasis on relative prices was for economic understanding.

So why would Friedman seem to be more in-line with Keynes than with Alchian and Buchanan?  I think one possible explanation is that Friedman's framework of analysis shifted from his student days and from his teaching of price theory to his work as a macroeconomists and monetary theorist.  In short, during the critical decades of his development as the major intellectual opponent to the Keynesian dominance in the economics profession, Friedman was a critic from the inside of that system.  He was for all practical purposes a Keynesian, but one that argued that the system had different underlying empirical relationships with regard to consumption behavior, public and private investment, and monetary policy.  In a document recently uncovered at the Buchanan archives, there is a letter from Hayek to Arthur Seldon at IEA dated May 13, 1985 in which Hayek bemoans the fact once again that he didn't review Keynes's General Theory, but then also adds that he regrets not having gone on the offense attack of Friedman.  "Milton," Hayek writes, "was for a time a Keynesian" and was one of the primary reasons why the "whole macroeconomic nonsense" grew rather than was abandoned as it should have been.  He hesitated to write up his critique because he didn't want to see MPS divided into a Hayekian wing and a Friedmanite wing, and thus he avoided stating his views too bluntly, but that a "good detailed critical analysis of macroeconomics would be very desirable" and then he mentions Lachmann and Hutt as potential go-to sources, but fears their advancing age might not be conducive to such an endeavor.

Food for thought for sure.

 

New Mercatus Study on the Barriers to Upward Mobility

Steve Horwitz

I have a new policy study just out today from the Mercatus Center titled “Breaking Down the Barriers: Three Ways State and Local Governments Can Improve the Lives of the Poor.” The following provides a convenient summary of the argument:

Many discussions of poverty and inequality are bogged down in debates about tax rates and government spending, trapped under the assumption that the cause of some people’s poverty is other people’s wealth. One key factor preventing upward mobility is state and local regulations that make it more expensive and time-consuming for the poor to open new businesses or enter a new profession. By eliminating burdensome business regulations such as occupational licensing and zoning restrictions and by refraining from imposing sin taxes, policymakers can let the poor help themselves move up and out of poverty.

War is the Health of the State

|Peter Boettke|

Robert Higgs gives the 2015 Murray N. Rothbard Medal of Freedom lecture at Mises University.

Sound Economic Reasoning Teaches ...

|Peter Boettke|

When I learned economics from Hans Sennholz at Grove City College he often made two claims. First, he would tell us what sound economics -- or what he sometimes called orthodox economics, but at other times called free market economics -- taught about mutually beneficial trade, the division of labor, the free mobility of goods, services and people across international borders, the importance of sound money and of fiscal responsibility, and the failures of socialism and interventionism.  The laws of economics, he would say, were inexorable.  Second, he stressed to us how few people actually understood economics even among professional economists.  Roughly 10% of professional economists circa 1980 was his figure, but that 10% understood a truth that traced back centuries to the founding traditions of sound economic reasoning and simply reflected the refinement and updated application of that orthodox tradition.

The task of the economic educator was to communicate to students and the public the truth of the first claim.  The task of the economic scholar/scientist was to correct the reality of the second claim and in doing so bring the economics profession back into line with the core teachings of the discipline.  To do so, Sennholz insisted that one must study closely the teachings of the alternative schools of economic thought --- Marxist, Institutionalist, Keynesian -- but also Monetarism -- and as such we read original works in his classes and seminars from Marx, Veblen, Galbraith, Keynes, and Friedman, as well as Menger, Bohm-Bawerk, Mises, and Hayek.  We also read Adam Smith, David Ricardo, J. B. Say, and J. S. Mill.

When I went to graduate school to earn a PhD and become an economic educator and economic scholar/scientist, both of Sennholz's claims were my guideposts.  This remains true to this day -- thus my distinction between mainline economics and mainstream economics.  Mainline economics is simply the intellectual tradition of sound economic reasoning from Adam Smith to Vernon Smith that starting from the fact of scarcity recognizes that trade-offs abound, and as such individuals must constantly negotiate carefully these trade-offs and that in order to do so they must rely on institutions that provide incentives for attentiveness to the situation and information that clarifies the situation and guides decision making.  The animating individuals interact within various institutional filters which possess alternative incentive structures and levels of informational clarity which in turn produce equilibrating tendencies in a welfare enhancing direction or a welfare reducing one.  Claims about the "invisible hand of the market", in other words, are not invariant to specifications of the institutional environment within which self-interest pursuits are played out by individuals.

Failure to appreciate this mainline, or orthodox, mode of economic reasoning results due to philosophical blind-spots -- often played out in methodological disputes such as the debate with the historicists and institutionalists at the turn of the 20th century, or the debate with the formalist and empiricists mid-20th century.  Methodology matters, but it perhaps matters most at times when the professional consensus is one which stresses that it doesn't matter at all.  When we don't think about methodology those philosophical blind-spots become permanent blind-spots, and thus educators and researchers tend to think what currently is the practice is the only way to practice the discipline.  For those who disagree with the current consensus, it becomes imperative to try by any means possible to open eyes of ones fellow educators and researchers.

Dr. Sennholz was a passionate economic preacher who taught in a small Christian college in western PA, so one can perhaps understand why his message might not have persuaded many of his peers within the professional ranks of educators and researchers.  But his impact on students was certainly not trivial, and his message can also be found repeated in various forms by many leading practitioners of mainline economics and political economy.  Consider the paragraph in Ronald Coase's 1959 paper on the Federal Communications Commission where he discusses the novel theory of Adam Smith in addressing the power of the price system, and the relative ineptness of political allocation in comparison.  Or, passages from James Buchanan on what the task of the economists should be in terms of studying exchange relations and the institutions within which those relationships are formed and sustained.  My favorite passage is actually from Ludwig von Mises's Human Action where he sums up the situation as follows:

The body of economic knowledge is an essential element in the structure of human civilization; it is the foundation upon which modern industrialism and all the moral, intellectual, technological, and therapeutical achievements of the last centuries have been built. It rests with men whether they will make the proper use of the rich treasure with which this knowledge provides them or whether they will leave it unused. But if they fail to take the best advantage of it and disregard its teachings and warnings, they will not annul economics; they will stamp out society and the human race.

I believe with all sincerity each word of this ending passage from Mises's great work, and it fuels my passion as an educator and as a research scholar/scientist.  And, I think it should fuel you as well.

But let me add some historical perspective to this position again.  If you read Hayek's 1933 piece on "The Trend of Economic Thinking" you will see the same essential message as that of Sennholz's claims being made.  Hayek's great concern is the contradictory implication of the two claims for the interpretation of economic events and for practical economic policy.  But you can see Hayek raising this concern already in his review essay on Edwin Cannan's An Economist's Protest which was published in 1929 in the Zeitschrift Fur Nationalokonomie.  In that review Hayek applauds Cannan for showing "how far economic policy in all countries departed from what economic reason would have called for."  He also stresses how "clear-sighted economists" such as Cannan (and later in the review he would invoke Mises as another example) were disregarded to the detriment of the societies.  Proposals instead are followed, "in spite of all the warnings of science" because statesmen choose policies based on faulty or spurious reasoning -- perhaps due to special interest pleading but also due to the prevalence of popular fallacies.  The only antidote is the "ruthless consistency" of the economic way of thinking.  As Hayek concludes his essay, the only lament a reader should have after working through Cannan's volume is "if only we had had in recent years many more economists as able and willing to protest as was Cannan!"  And despite the lost intellectual battles of the past two decades, Hayek suggests that Cannan's example shows a "new generation of learned economists what they are capable of accomplishing for the common good" and that An Economist's Protest would be excellently suited as a "reader for the economist who wants to learn how to make the results of his science generally useful."

Sound economic reasoning teaches many things, but perhaps the most important lesson is about the importance of the instituitonal framework for marshalling the self-interest of individuals into publicly desirable outcomes by enabling the judicous negotiation of trade-offs so that the gains from trade and the gains from innovation are realized.  Some instituitonal environments promote productive specialization and peaceful social cooperation among individuals, others don't.  Economic reasoning is essentially discursive reasoning in comparative institutional analysis.   As you prepare yourself for the fall term of teaching in a contemporary context full of examples of popular fallacies perpetuated by politicians and pundits, and methodological blind-spots causing professional apathy on the one hand, and professional malpractice on the other, think of Hayek's examples of "clear-sighted economists" such as Cannan and Mises (and Hayek and Friedman; and Buchanan and Coase; and Rothbard and Stringham/Leeson/Skarbek; and Higgs and Coyne/Powell, etc.).  Economists can, and must, do a lot of common good by teaching to their students and the public the results that the science has to offer that emanate from sound economic reasoning about scarcity, self-interest, and spontaneous order.  Ruthless consistency in the economic way of thinking is not a vice, it is a virtue.

 

 

Mill > Keynes, so says Steven Kates

|Peter Boettke|

Steven Kates has an interesting essay at Liberty Matters addressing what was the conventional wisdom in "macroeconomics" at the time of John Stuart Mill, how that was transformed by John Maynard Keynes, and what was the consequences as a result.  In Kates's narrative, knowledge was lost and the consequences are damaging for macroeconomic policy.

He concludes his essay by stating:

We seem to have a completely false notion that economic theory moves only forward, that the latest is the best, and that past has been transcended. The reality is that the economics of Mill, even his 1848 first edition, will provide more insight into the operation of an economy than any of the Samuelson clones that have been published to explain what Keynes meant in trying to raise aggregate demand.

Commenting on Kates's essay will be Nick Capaldi, Richard Ebeling, and Sandra Peart.  You can follow the conversation for the next month.

Greece and Wrestling with the Fiscal Commons

|Peter Boettke|

The Greece Referendum is finishing up as I write this.  Millions are voting today on whether or not to accept the terms of the international bailout of their fiscal woes.  For the point I want to make, it doesn't matter if they vote YES or NO, though that may have significant repercussions for the global economy.  The critical matter from the point of view of economic theory and policy discussions is to sort out the root cause of the fiscal mess -- not only in Greece, but among several EU states. And, of course, by this logic the US situation is not immune from judgement, nor anywhere else throughout the globe.  Democratic fiscal policy appears to have an institutional problem with regard to sustainable public finance.  How do we design our institutions of public administration and finance in a democratic society so they encourage fiscal responsibility?  Lack of such fiscal responsibility entraps economies in, what Adam Smith termed, the juggling tricks of deficits, debt, debasement.  This trick sucks the vibrancy out of an economy, and if left undisciplined sinks an economy altogether in a way we have been witnessing in Greece.

For most of the history of political economy, economic thinkers understood the importance of fiscal responsibility.  But the 20th century saw a decisive break from the "old time fiscal religion" and the adoption throughout the democratic west -- especially after WWII -- of the idea that the democratically responsible thing to do was to use the budget as a tool for macroeconomic policy.  The core idea behind functional finance was to use the budget to balance the economy, not to worry about balancing the budget in public affairs of a state.  This had a significant impact on politics and on economic policy.

James Buchanan probably thought more about the inter-relationship between the structure of politics and economic policy decisions than any modern economist.  In his work in public finance, he represented a fundamental challenge to the conventional wisdom mid-20th century at a methodological, analytical and practical policy level.  In Public Principles of Public Debt, Buchanan defended the "classical political economists" position with respect to public finance/public debt, but what at that time was referred to as "vulgar economics" of the untrained modern neoclassical synthesis Keynesianism.  In his 1949, "The Pure  Theory of Government Finance," Buchanan was already challenging the methodologically collectivist/constructivist notion of the "fiscal brain" and contrasting it with the methodologically individualistic politics as exchange notion that would later provide the foundation for public choice and constitutional political economy.

Economics and Political Economy is fundamentally about exchange relations and the institutions within which they exchanges take place.  Rules and strategies within rules are the two distinct areas of research exploration.  With respect to fiscal policy, this means paying attention to the institutions that define the relationship between the expenditure decision and the revenue decision.  If the logic of democratic politics produces a systemic tendency to concentrate benefits on the well-organized and well-informed special interest groups in the short-run and disperse the costs on the unorganized and ill-informed mass of voters in the long-run, then the budget is perhaps best seen as a fiscal commons by all politicians and special interest groups.  Wrestling with the fiscal commons becomes one of the primary concerns for those economists and political economists who like Adam Smith understand that those juggling tricks are economy killers.  Rather than stressing that economists should become "master jugglers", the critical point is to figure out ways that stop the juggling acts before they are required.  We must always remember that even master jugglers can drop the ball, and as time passes and the level of difficulty associated with the juggling trick grows exponentially, the consequences of slight errors becomes pronounced.  The current fragility in the world financial system, I would argue, is a consequence of 60+ years of juggling tricks throughout the democratic west.

Anyway, as the vote is going on in Greece, and the repercussions of either decision will be felt throughout the world, it might be worth while to step back and learn from the master public economist -- James Buchanan.  Institutional problems demand institutional solutions.  No juggling -- either of logic or a policy -- just hard nosed economic reasoning and an exploration of the logic of the situation and the logic of organization. 

 

Israel Kirzner's Hayek Medal Lecture in Berlin -- June 2015

|Peter Boettke|

Israel Kirzner joins a distinguished list of recipients of the Hayek Medal that includes Gary Becker, Vernon Smith, Viktor Vanberg and Geoff Brennan.  Obviously, a well deserved honor, and again a subtle and brilliant lecture by Professor Kirzner.