Liberty Fund

Culture, Politics, and Economic Development

PAUL COLLIER ANNUAL REVIEW OF POLITICAL SCIENCE Abstract: For a generation, political science has been dominated by the analysis of interests within the framework of rational choice. Although this has enabled major advances, it struggles to provide a plausible analysis of many instances of sociopolitical dysfunction. This article reviews recent innovations in economics, psychology, and economic […]

The American Bar Association Stifles Legal Education

The Accrediting Council on Education in Journalism and Mass Communications is a nonprofit accrediting agency for journalism programs. Bradley Hamm, the dean at Northwestern’s Medill School of Journalism, has called the council’s accreditation-review process “flawed,” “superficial,” “extremely time-consuming,” and “sort

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Just the Facts

EconTalk host Russ Roberts welcomed historian Thomas Ricks to the program this week to discuss his new book, Churchill and Orwell: The Fight for Freedom. While these two figures might not seem to have much in common at first glance, Ricks persuades otherwise, and that both played an important role in the post-War preservation of individual liberty. Ricks initially saw Orwell as a "left-wing parallel" to his hero, Winston Churchill, but he soon discovered they had much more in common than he had thought. How much do you think the two share? Help us continue this week's conversation, and share your thoughts with us.

What's causing the low inflation?, by Scott Sumner

This article caught my eye:

When online retail giant Amazon.com Inc. announced last Friday that it would purchase Whole Foods Market Inc., a plunge in retail and grocery stocks reinforced the disinflationary tone set by three straight months of disappointing data on consumer prices. It's an example of the technological forces that are increasing competition and further limiting companies' ability to pass on higher wage costs to customers.

"That normally indicates that somebody thinks that they are not going to be earning as much as they were," Federal Reserve Bank of Chicago President Charles Evans said of the market reaction to the deal while speaking with reporters Monday evening after a speech in New York.

"For me, it just seems like technology keeps moving, it's disruptive, and it's showing up in places where -- probably nobody thought too much three years ago about Amazon merging with Whole Foods," he said.

Evans, a voter on the Federal Open Market Committee this year who supported its decision to raise interest rates last week, says he is less confident than most of his colleagues that inflation will soon rise to their 2 percent target.

A big reason for his ambivalence: Deflationary competitive pressures could have become more important for the overall trend in prices than the so-called Phillips Curve relationship, which links inflation to the state of the labor market. That model, coined almost 60 years ago, is the basis for the Fed's outlook for continued gradual rate increases.
I'm a bit confused by this. I certainly agree that there are good reasons to question the Phillips Curve model, for standard "never reason from a price change" reasons. The Phillips Curve only works if changes in inflation are driven by AD shocks, not aggregate supply shocks. In that sense I agree with Evans.

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Tanenhaus on James Buchanan, by David Henderson

I have just read the first serious book review I've seen of historian Nancy MacLean's hatchet job book on James Buchanan, Democracy in Chains: The Deep History of the Radical Right's Stealth Plan for America. It's by Sam Tanenhaus.

He is, by and large, sympathetic with MacLean's strong claims about the role of James Buchanan in the rise of the radical right. Those of us who knew him well are more skeptical, partly because he was so bookish, so into thinking about fundamental ideas about governments and societies, and not really up to date on this or that political skirmish or current politician.

In any case, parts of the Sam Tanenhaus piece read as if Tanenhuas is writing for an audience that knows little economics and little U.S. history and is, therefore, credulous. Or it's possible it's Tanenhaus himself who's ignorant and credulous. I don't know. Three passages stand out.

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The New Left’s Dangerous Old Antitrust Ideas

The course of antitrust law in American history has proved a barometer of good governance.  In the New Deal, the Roosevelt administration lurched from one policy to another, united only by the injury they did to the economy.  Sometimes that

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Quality of government and regional competition: A spatial analysis of subnational regions in the European Union

ANTONIO BUBBICO, JOHAN A. ELKINK, MARTIN OKOLIKJ EUROPEAN JOURNAL OF POLITICAL RESEARCH Abstract: Building on previous work on competition networks and governmental performance among British local governments, this article investigates the diffusion of government quality across subnational regions of Europe through strategic interaction with neighbouring regions or competitor regions more generally. The article demonstrates the presence […]

Three Lectures on the Cost of Obtaining Money (Nassau William Senior)

Three Lectures on the Cost of Obtaining Money and on some effects of Private and Government Paper Money (London: John Murray, 1830).

Living Constitutionalism on the Supreme Court’s Website

Six years ago, I wrote a post about how the Supreme Court’s website adopted the language of the Living Constitution approach.  (I had been expanding on a post by Eugene Volokh.)  It was curious that Justices Scalia and Thomas, as …

Thomas Ricks on Churchill and Orwell

Author and historian Thomas Ricks talks with EconTalk host Russ Roberts about his book, Churchill and Orwell. Ricks makes the case that the odd couple of Winston Churchill and George Orwell played and play an important role in preserving individual liberty. Ricks reviews the contributions of these two giants whose lives overlapped and whose legacy remains vibrant.

Play

Time: 1:05:47

The market process of capitalization: a laboratory experiment on the effectiveness of private information

EDUARD BRAUN, WIEBKE ROß JOURNAL OF EVOLUTIONARY ECONOMICS Abstract: The notion of present value is an integral part of economics. So far, however, its rationale rests upon the well-known neoclassical assumptions of complete information and perfect rationality. The present value derives as the result of a calculation that requires the knowledge of the discount rate and […]

David Hume on property as a convention which gradually emerges from society (1739)

David Hume on property as a convention which gradually emerges from society (1739)

The Spanish-American War and the Anti-Imperialism League (1902)

"Expansion: The Water-Cure method of extorting from Uncle Sam the confession that an Empire is better than a Republic."

"Expansion" The Public (January 31, 1902)

Return to Marbury

The travel ban case is headed to the Supreme Court by way of the once redoubtable Fourth and always activist Ninth Circuits, leaving revisionists to wonder how it might have unfolded had it made its way upward through Judge William

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“Are Economists Basically Immoral?” and Other Essays on Economics, Ethics, and Religion (Paul Heyne)

Many of the essays in this volume are published here for the first time. The editors, Geoffrey Brennan and A. M. C. Waterman, have divided Heyne’s essays thematically to cover three general areas: the ethical foundations of free markets, the connection between those ethical foundations and Christian thought, and the teaching of economics—both method and substance. Heyne’s writings are unique in that he takes the critics of the free market order seriously and addresses their arguments directly, showing how they are defective in their understanding of economics and in their ethical and theological underpinnings.

Progressive/Libertarian: The Alliance That Isn't, by Bryan Caplan

My one big disagreement with Ed Glaeser's great piece on housing deregulation is when he says:

Reforming local land use controls is one of those rare areas in which the libertarian and the progressive agree. The current system restricts the freedom of the property owner, and also makes life harder for poorer Americans. The politics of zoning reform may be hard, but our land use regulations are badly in need of rethinking.Actually, there are four other big areas where the two ideologies converge. 

1. Immigration.  Immigration restrictions deprive billions of basic liberties, impoverish the world, and do so on the backs of the global poor, most of whom are non-white.

2. Occupational licensing.  Licensing laws bar tens of millions of people from switching to more lucrative and socially valuable occupations, all to benefit richer insiders at the expense of poorer outsiders.

3. War, especially the War on Terror.  Since 2002, the U.S. has literally spent trillions fighting the quantitatively tiny problem of terrorism by waging non-stop wars in the Middle East.  We don't know what the Middle East would have looked like if the U.S. had stayed out, but it's hard to believe it would be worse.  And there's no end in sight.

4. The criminal justice system, especially the War on Drugs.  Hundreds of thousands of non-violent people, disproportionately poor and non-white, are in prison.  Why?  To stop willing consumers from doing what they want with their own bodies.

Lysistrata's clever plan to end the war between Athens and Sparta (411 BC)

Lysistrata’s clever plan to end the war between Athens and Sparta (411 BC)