2 Minutes with Friedman
12 Mar 2018 Leave a comment
in applied price theory, David Friedman, development economics, economics of regulation, labour economics Tags: spontaneous order, The fatal conceit
Jordan B Peterson on “But That Wasn’t Real Communism, Socialism, or Marxism!”
31 Jan 2018 Leave a comment
in applied price theory, comparative institutional analysis, constitutional political economy, economic history, economics of bureaucracy, economics of crime, history of economic thought, law and economics, Marxist economics, Public Choice, rentseeking Tags: fall of communism, The fatal conceit
The Vision of Jeffrey Sachs
28 Jan 2018 Leave a comment
in applied price theory, development economics, economic history, economics of bureaucracy, entrepreneurship, growth disasters, growth miracles, Public Choice, rentseeking Tags: overseas aid, The fatal conceit
The Vision of Jeffrey Sachs by Bill Easterly
03 Jan 2018 Leave a comment
in applied price theory, comparative institutional analysis, constitutional political economy, development economics, growth disasters, growth miracles, Public Choice, rentseeking Tags: Bill Easterly, overseas aid, The fatal conceit
Co-op founder expains impact of net neutrality on a small ISP
17 Dec 2017 Leave a comment
in applied price theory, economics of media and culture, economics of regulation, industrial organisation, politics - New Zealand, politics - USA, survivor principle Tags: net neutrality, The fatal conceit, The pretence to knowledge, unintended consequences
Early temperance movements were a public health setback
10 Jun 2017 Leave a comment
in applied price theory, economic history, economics of regulation, health economics Tags: economics of prohibition, offsetting behaviour, The fatal conceit, unintended consequences
Watching a history of prohibition. Started in 1850s, at least half a century before safe drinking water was freely available such as through tap water.
Beer was much safer than drinking water until a good way into the 20th century. Initial temperance movement was against hard liquor but quickly was about abstinence.
What’s the Right Minimum Wage?
25 Feb 2017 Leave a comment
in applied price theory, applied welfare economics, economics, labour economics, minimum wage Tags: offsetting behaviour, The fatal conceit, unintended consequences
The compassion of unions towards the minimum waged
24 Jan 2017 1 Comment
in labour economics, minimum wage, poverty and inequality, unemployment, unions Tags: do gooders, The fatal conceit, The pretense to knowledge
Source: page 451 and page 828 of the 3rd edition (1972) of University Economics by Armen Alchian and William Allen; the first part of the quotation is Question #30 at the end of Chapter 22. via Bonus Quotation of the Day… – Cafe Hayek
Great Escape passed by @WorldBank’s preoccupation with RCT (randomised controlled trials) as next big thing in development policy
04 Dec 2016 Leave a comment
in development economics, economics of bureaucracy, growth miracles, history of economic thought Tags: randomised controlled trials, The fatal conceit, The Great Escape, The pretense to knowledge
Milton Friedman is said to have mesmerised several countries with a flying visit!?
30 Sep 2016 Leave a comment
in business cycles, economic growth, macroeconomics, Milton Friedman, monetarism, monetary economics, politics - Australia Tags: central banks, conspiracy theories, lags on monetary policy, monetary policy, rules versus discretion, The fatal conceit, The pretense to knowledge
Milton Friedman visited Australia in 1975. He spoke with government officials and appeared on the TV show Monday Conference. Apparently, that was enough for him to take over Australian monetary policy setting for the foreseeable future.
When working at the next desk to the monetary policy section in the late 1980s, I heard not a word of Friedman’s Svengali influence:
- The market determined interest rates, not the reserve bank was the mantra for several years. Joan Robinson would be proud that her 1975 visit was still holding the reins.
- Monetary policy was targeting the current account. Read Edwards’ bio of Keating and his extracts from very Keynesian treasury briefings to Keating signed by David Morgan that reminded me of macro101.
See Ed Nelson’s (2005) Monetary Policy Neglect and the Great Inflation in Canada, Australia, and New Zealand who used contemporary news reports from 1970 to the early 1990s to uncover what was and was not ruling monetary policy. For example:
“As late as 1990, the governor of the Reserve Bank rejected central-bank inflation targeting as infeasible in Australia, and cited the need for other tools such as wages policy (AFR, October 18, 1990).”
Bernie Fraser was still sufficiently deprogrammed in 1993 to say that “…I am rather wary of inflation targets.” Easy to then announce one in the same speech when inflation was already 2-3%.
When as a commentator on a Treasury seminar paper in 1986, Peter Boxhall – fresh from the US and 1970s Chicago educated – suggested using monetary policy to reduce the inflation rate quickly to zero, David Morgan and Chris Higgins almost fell off their chairs. They had never heard of such radical ideas.
In their breathless protestations, neither were sufficiently in-tune with their Keynesian educations to remember the role of sticky wages or even the need for the monetary growth reductions to be gradual and, more importantly, credible as per Milton Freidman and as per Tom Sargent’s End of 4 big and two moderate inflations papers.
I was far too junior to point to this gap in their analytical memories about the role of sticky wages, and I was having far too much fun watching the intellectual cream of the Treasury senior management in full flight. At a much later meeting, another high flying deputy secretary was mystified as to why 18% mortgage rates were not reining in the current account in 1989.
Friedman’s Svengali influence did not extend to brainwashing in the monetarist creed that the lags on monetary policy were long and variable. The 1988 or 1989 budget papers put the lag on monetary policy at 1 year, which is short and rapier, if you ask me.
Saving Endangered Species
25 Sep 2016 Leave a comment
in applied price theory, applied welfare economics, Austrian economics, comparative institutional analysis Tags: endangered species, offsetting behaviour, The fatal conceit, unintended consequences
Seinfeld Economics: The Shower Head (black markets)
07 Sep 2016 Leave a comment
in applied price theory, applied welfare economics, comparative institutional analysis, economics, economics of media and culture, environmental economics, environmentalism, television Tags: black markets, nanny state, offsetting behaviour, Seinfeld, The fatal conceit, water economics
Utopia, you are standing in it! 
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