Liberty Fund

Chris Arnade on Dignity

Photographer, author, and former Wall St. trader Chris Arnade talks about his book, Dignity, with EconTalk host Russ Roberts. Arnade quit his Wall Street trading job and criss-crossed America photographing and getting to know the addicted and homeless who struggle to find work and struggle to survive. The conversation centers on what Arnade learned about […]

Adam Smith and Silas Marner: Heaps of Gold

by Elizabeth M. Hull for AdamSmithWorks

Peter Thiel and the Path to a New Conservatism

Those of us who argue that what we conserve is freedom together with equality need to make an ally of Thiel.

The Discouraged Suitor, by Bryan Caplan

Labor economists occasionally have a crisis of faith.  After years of scrutinizing the unemployment rate, they suddenly remember… discouraged workers.  Who are they?  They’re people who want a job, but aren’t officially unemployed because they aren’t actively searching for work.

This is a serious problem – and a serious flaw with official unemployment rates.  True, we should not forget the Prideful Worker Effect – the workers who say they want a job, but refuse to do any job for which they’re genuinely qualified.  But if you take introspection half as seriously as I do, you can hardly deny that lots of people find job search extremely demoralizing.  When your whole ego and sense of self are on the line,  one needs Stoic determination to keep looking in the face of multiple rejections.  Every parent has seen even the sweetest of children surrender to despair.  Does anyone seriously believe that human beings cease to have these emotions by their eighteenth birthday?

Livy on the irrecoverable loss of liberty under the Roman Empire (10 AD)

The JEC report on the economy, by Scott Sumner

The Joint Economic Committee of Congress has released a report that responds to the 2019 Economic Report of the President. The table of contents has a section on monetary policy, which caught my eye:

Later on in the report (page 33) I saw this:

Scott Sumner (2018) offers a proposal that involves the Federal Reserve setting “specific quantifiable goals” for price stability and maximum employment, or a metric that simultaneously embodies both, over the upcoming year. After the year has elapsed and the data becomes available, if the relevant metric(s) varied from the pre-specified goal, the Federal Reserve would report to Congress that monetary policy had been either too easy or too tight, and would propose how it will rectify the deviation. This would make it easier for the Federal Reserve to explain and justify corrective measures. An enhanced public understanding and acceptance of Federal Reserve corrective measures would enable less invasive Federal Reserve interventions as markets would adjust their behavior in advance.

Normative Foundations of Originalism

Libertarian originalism tends to undermine conservative legal positions.

The Ruins: or a Survery of the Revolutions of Empires (Constantin-François Chasseboeuf, Marquis de Volney)

The Ruins: or a Survery of the Revolutions of Empires, 3rd ed. (London: J. Johnson, 1796).

The Case Against Education: Now in Paperback, by Bryan Caplan

The Case Against Education is now in paperback, with a new Afterword by yours truly.  Highlights from the Afterword:

My earlier work (Caplan 2007) maintains that when economists and the public disagree, the economists are usually right.  The Case Against Education, however, focuses on a rare topic where economists and the public are on the same page.  The sad result, in my view, is that economists end up rationalizing popular errors rather than correcting them.  Not all economists, of course; Michael Spence won a Nobel Prize for developing the signaling model on which my book relies.  Yet by and large, labor and education economists thoughtlessly equate schooling with “human capital formation.”

Why Do We Look to Science As a Guide for Living?

Science-based morality makes moral “progress” impossible, if not immoral.

The Theory of Moral Sentiments: Part VII, Section IV

Of the Manner in which different Authors have treated of the practical Rules of Morality

Thirty Minor Upanishads (Misc (Upanishads))

Thirty Minor Upanishads, trans. K. Narayanasvami Aiyar (Madras: Printed by Annie Besant at the Vasanta Press, 1914).

Is Legal Conservatism as Accomplished as It Thinks It Is?

If the demolition from the 2016 wrecking ball does not create this change in the legal world, I think it is safe to say the next populist uprising will.

Thomas Gordon gives a long list of ridiculous and frivolous reasons why kings and tyrants have started wars which have led only to the enslavement and destruction of their own people (1737)

Liberalism as Armed Doctrine: A Conversation with Philip Hamburger

Philip Hamburger joins us to discuss his new book Liberal Suppression

Mises on Gresham’s Law and Ancient Greek Silver Coins

In an Appendix to his The Theory of Money and Credit (1912) the Austrian economist Ludwig von Mises (1881-1973) discussed the value of a silver coin issued by Gelon the King of Syracuse in 480 BC. A picture of the coin was used on the original cover of the book. Mises was interested in these coins because he believed that sound currency emerged in the ancient world as a result of the productive economic activity which went on in places such as Lydia (Turkey) and Athens. These places remained economically powerful only so long as they retained a sound currency, which he believed Athens did and the other Greek city states did not. The Appendix about this coin is included below along with the illustration.

Commerce, Culture, and Liberty: Readings on Capitalism Before Adam Smith (Henry C. Clark)

In this Liberty Fund book the editor has compiled some of the more important writings on economics before the appearance of Smith’s Wealth of Nations in 1776. It is particularly strong on the French contribution. Not all the pieces in this volume have been put online for reasons of copyright.

Incentives

Introduction

In economics, incentives matter. If you make decisions without thinking about your personal incentives, let us know.

Definitions and Basics

Incentives Matter, by Russ Roberts at Econlib

Incentives matter. The most famous example in economics is the idea of the demand curve—when something gets more expensive, people buy less of it. When it gets less expensive, people buy more of it….

Demand, from the Concise Encyclopedia of Economics

The main reason economists believe so strongly in the law of demand is that it is so plausible, even to noneconomists. Indeed, the law of demand is ingrained in our way of thinking about everyday things. Shoppers buy more strawberries when they are in season and the price is low. This is evidence for the law of demand: only at the lower, in-season price are consumers willing to buy the higher amount available. Similarly, when people learn that frost will strike orange groves in Florida, they know that the price of orange juice will rise. The price rises in order to reduce the amount demanded to the smaller amount available because of the frost. This is the law of demand. We see the same point every day in countless ways. No one thinks, for example, that the way to sell a house that has been languishing on the market is to raise the asking price. Again, this shows an implicit awareness of the law of demand: the number of potential buyers for any given house varies inversely with the asking price….

The Works of Epictetus. Consisting of His Discourses, in Four Books (Epictetus)

The Works of Epictetus. Consisting of His Discourses, in Four Books, The Enchiridion, and Fragments. A Translation from the Greek based on that of Elizabeth Carter, by Thomas Wentworth Higginson (Boston: Little, Brown, and Co., 1865).

John Bright calls British foreign policy "a gigantic system of (welfare) for the aristocracy" (1858)

Phillip W. Magness, “William Leggett: Free Trade, Hard Money, and Abolitionism” (July, 2019)

The American political journalist William Leggett (1801-1839) had a short but productive period of activity between 1834-39 when he became famous, even notorious, for his opposition to slavery, tariffs, a state privileged National Bank, and government intervention in the economy to benefit special interests (like bankers, industrialists, and slave owners). Leggett's position of consistent opposition to the state interfering in the economic affairs of individuals is one that does not sit well with the new school of economic historians of "capitalism" who argue that slavery and capitalism were joined at the hip and were "symbiotic". In this discussion Phil Magness, senior research fellow at the American Institute for Economic Research, argues that it is Leggett who is the consistent one and the advocates of the "New History of Capitalism" are the ones who are confused and do not seem to know about this "broader liberal political tradition" of which Leggett was a member. He is joined in the discussion by Anthony Comegna, from the Institute for Humane Studies, Brian Schoen, associate professor of history at Ohio University, and Lawrence H. White, professor of economics at George Mason University.

See the Archive of "Liberty Matters".

Sir Edward Coke, “Petition of Right” (1628) (Sir Edward Coke)

The Best of the OLL No. 42: Sir Edward Coke, “Petition of Right” (1628) (Indianapolis: Liberty Fund, 2013).

Richard H. Thaler

Richard H. Thaler won the 2017 Nobel Prize in Economic Science for “his contributions to behavioral economics.”

In most of his work, Thaler has challenged the standard economist’s model of rational human beings.  He showed some of the ways that people systematically depart from rationality and some of the decisions that resulted. He has used these insights to propose ways to help people save, and save more, for retirement. Thaler also advocates something called “libertarian paternalism.”

Economists generally assume that more choices are better than fewer choices. But if that were so, argues Thaler, people would be upset, not happy, when the host at a dinner party removes the pre-dinner bowl of cashews. Yet many of us are happy that it’s gone. Purposely taking away our choice to eat more cashews, he argues, makes up for our lack of self-control. This simple contradiction between the economists’ model of rationality and actual human behavior, plus many more that Thaler has observed, leads him to divide the population into “Econs” and “Humans.” Econs, according to Thaler, are people who are economically rational and fit the model completely. Humans are the vast majority of people.

Leggett on the tendency of the government to become "the universal dispenser of good and evil" (1834)