Author: Brandon Christensen

Austrian Economics and Empirical Research

Brandon Christensen Economics , ,

Economist Steve Horwitz has a great lead-off in this month’s Cato Unbound. It’s all about the Austrian School of economics and its various detractors and factions. Some highlights:

Rather than being anti-empirical, modern Austrian economists are trying to open up the box of what counts as “empirical evidence” to include forms normally dismissed out of hand by the rest of the profession. Arguably, then, modern Austrians might well be more empirical than other economists, at least as judged by their professional work […]

Good economics for Austrians means sound arguments, not just valid ones. Too much of modern economics consists of valid reasoning from false premises about human action. The accuracy of those premises matter greatly for Austrians.

That is one reason why subjectivism is more important than praxeology for understanding Austrian applied research. Economics is radically subjectivist in the sense that human action depends upon the perceptions of the world held by the actor […]

Subjectivism also explains Austrian skepticism about statistical correlation being the privileged form of empirical evidence. It only provides correlation, and to provide causation requires a theoretical explanation. If such explanations must start with actors’ perceptions of the world, then forms of empirical evidence that capture such perceptions would be at least as useful. Austrians therefore frequently turn to primary source material and interview and survey work as well as quantitative data to tell a complete story of how a particular economic phenomenon came to be and functioned. How did actors perceive their options and constraints and what sorts of consequences emerged from their choices?

Dr. Horwitz goes on to give readers a brief list of introductory readings for those who are interested in the academic side of the Austrian School, rather than just the political and popular side. Highly recommended. You read the whole thing here.

Update: Longtime reader (and admin of NOL’s Facebook page) Hank points us to a rebuttal over at the Mises Institute’s blog. I didn’t find it convincing, but it’s still worth a look.

Friedrich Hayek: Champion of Liberty

Brandon Christensen Current Events, Economics, Links, Politics , , , , ,

From Richard Epstein:

Thus Hayek’s 1940 contribution to the “Socialist Calculation” debate debunked the then-fashionable notion that master planners could achieve the economic nirvana of running a centralized economy in which they obtain whatever distribution of income they choose while simultaneously making sound allocations of both labor and capital, just like in Soviet Russia.

Hayek exposed this fool’s mission by stressing how no given individual or group could obtain and organize the needed information about supply and demand conditions throughout the economy. The virtue of the price system was its use of a common unit of measurement—money—to allow various actors to compete for a given resource without having to lay bare why they need any particular good or service. The seller need only accept the highest bid, without nosing around in other people’s business. The interaction between buyers and sellers allows for constant incremental adjustments of both price and quantity. Old information gets updated in a quick and reliable way, thereby eluding the administrative gauntlet of the socialist state.

This essay, which y’all should read, was sparked by the attacks on Rep. Paul Ryan’s supposed intellectual influences F.A. Hayek and Ayn Rand.

The Oppression of American Labor

Brandon Christensen Current Events, Liberty, Politics , , , , ,

Over at the Real-World Economics blog, economist Edward Fullbrook presents a graph of labor’s demise in the United States as well as an article from Al-Jazeera English titled America in Denial that promotes Fullbrook’s new book.

Fullbrook brings it to the attention of work-weary Americans that they work far too many hours per year compared to other rich societies in the West (there are, of course, no rich societies outside of the West, but that’s a different blog for a different day).

Behold! The cold, hard facts informing American workers of their own oppression! Continue reading →

Fact-Checking Politicians

Brandon Christensen Current Events, Politics , , ,

I know the last thing everybody wants to hear is another political rant, but I’m going to give it to you anyway.

Has anybody noticed the recent slew of “fact-checking” sheets and reports that have come out since Paul Ryan’s VP speech at the GOP convention*?

Does it really come as a shock to people to find out that politicians lie? I can’t wait to see the other side come out with the same kinds of reports after Joe Biden and the current demagogue-in-chief give their speeches.

Politicians lie? Really? Who would’ve thunk…

Here’s my two cents: Democrats lie more often than Republicans. Hands down. There are always exceptions to the rules, and being more honest than the Democratic Party is not exactly a milestone achievement.

Many people said this race might be the most interesting in a while (thanks to the protection of free speech that Citizens United upheld), but Continue reading →

Sex and Economics (And Karl Marx Too!)

Brandon Christensen Economics , , , , ,

The concept of economic reproduction is emphasized in the Marxian school of economic thought. In Marxist theory, the conditions for production are continuously re-created as a circular flow. The concept of the circular flow of both goods and of factor-inputs was first developed by the French economists of the 1700s, who called their theory of natural economic laws “Physiocracy.” The factors or categories of inputs are land, labor, and capital goods.

From co-editor Fred Foldvary. Do read the whole fascinating article. Many conservatives in the US (as well as libertarians) don’t give Karl Marx the time of day he deserves in order for thoughtful, polite discourse to take place. Many on the Right decry (and rightly so) the various strawmen that Leftists erect when attacking the proponents of private property, personal wealth and international trade, but are we any better when it comes to debunking Leftist arguments? Continue reading →

Class Warfare, Then and Now

Brandon Christensen Current Events, History, Politics , , , ,

These recent developments in labor relations show how changed market conditions offer welcome correctives to the New Deal approach. It is just these changes that are at risk under an Obama administration whose main agenda tracks Roosevelt’s early one: Vilify the rich as unproductive ciphers of society and work toward a progressive tax rate structure; be hostile toward the growth of international trade by denouncing firms that outsource jobs as the enemies of domestic labor; continue to work in favor of extensive agricultural subsidies for ethanol and other farm crops, no matter how great of a disruption these impose on domestic and foreign food markets; and insist upon a rich set of unsustainable healthcare benefits through Medicare and Medicaid.

This is from Richard Epstein. Okay, so Obama is a demagogue, a thief and a murderer. Is Mitt Romney really any better? Really?

I’m voting for Gary Johnson (if I vote at all).

Libertarian Internationalism and the Problem of World Government

Brandon Christensen Law , , , ,

Recently, I posted some musings on the writings of many libertarian intellectuals concerning world government. It is important to distinguish, really quickly and in blog form, that libertarians are internationalists, and internationalists are individualists. Indeed, the only logical conclusion of individualism is internationalism.

When libertarians speak of world government, though, we are not speaking of economic planning as has been undertaken by national governments (vigorously and largely unopposed) since the turn of the 20th century. Indeed, Hayek saw the problems we now see with supranational economic planning in his 1944 book The Road to Serfdom: Continue reading →

More on China and Irrational Fears in Conservative Circles

Brandon Christensen Current Events , ,

Writes Minxin Pei:

The latest news from Beijing is indicative of Chinese weakness: a persistent slowdown of economic growth, a glut of unsold goods, rising bad bank loans, a bursting real estate bubble, and a vicious power struggle at the top, coupled with unending political scandals. Many factors that have powered China’s rise, such as the demographic dividend, disregard for the environment, supercheap labor, and virtually unlimited access to external markets, are either receding or disappearing.

Yet China’s declining fortunes have not registered with U.S. elites, let alone the American public.

Do read the rest of the article. I’ve said as much on this blog before, and there is certainly no reason to fear a rising Beijing. Nor is there a good reason to spend more money on East Asian “defense” projects or stifle growth at home by throwing up isolationist tariffs. (h/t Daniel Larison)

Revamped and Reenergized

Brandon Christensen Current Events, Links , ,

I’m going to begin some pretty intensive research and writing projects over the next month and a half, so you probably won’t hear from me much (keep the hooting and hollering to yourselves, please!).

A couple of quick items of blogging business:

One of our loyal readers, Hank Moore, has generously volunteered to become the administrator of our revamped Facebook page. You can check out what he has been doing here. Thank you so much Hank! Honorable men are hard to come by these days.

I’ve been listening to this one song over and over again for the past three weeks. Sometimes I’ll even listen to the rest of the album, too.

If you haven’t heard yet, the ‘Recommendations‘ section has been in a steady process of renovation since the blog launched, and now I like what I’m beginning to see. let us know what you think. I think it does a good job of flexing the intellectual firepower of the libertarian movement (broadly construed).

Have a great weekend everybody!

Quick Question

Brandon Christensen Books, History , ,

I was hoping somebody out there could answer for me. Why is Ludwig von Mises such a bad ass? From the foreign policy section of Liberalism:

The right of self-determination works to the advantage only of those who comprise the majority. In order to protect minorities as well, domestic measures are required, of which we shall first consider those involving the national policy in regard to education.

In most countries today school attendance, or at least private instruction, is compulsory. Parents are obliged to send their children to school for a certain number of years or, in lieu of this public instruction at school, to have them given equivalent instruction at home. It is pointless to go into the reasons that were advanced for and against compulsory education when the matter was still a live issue. They do not have the slightest relevance to the problem as it exists today. There is only one argument that has any bearing at all on this question, viz., that continued adherence to a policy of compulsory education is utterly incompatible with efforts to establish lasting peace.

The inhabitants of London, Paris, and Berlin will no doubt find such a statement completely incredible. What in the world does compulsory education have to do with war and peace? One must not, however, judge this question, as one does so many others, exclusively from the point of view of the peoples of Western Europe. In London, Paris, and Berlin, the problem of compulsory education is, to be sure, easily solved. In these cities no doubt can arise as to which language is to be used in giving instruction. The population that lives in these cities and sends its children to school may be considered, by and large, of homogeneous nationality. But even the non-English-speaking people who live in London find it in the obvious interest of their children that instruction is given in English and in no other language, and things are not different in Paris and Berlin.

However, the problem of compulsory education has an entirely different significance in those extensive areas in which peoples speaking different languages live together side by side and intermingled in polyglot confusion. Here the question of which language is to be made the basis of instruction assumes crucial importance. A decision one way or the other can, over the years, determine the nationality of a whole area. The school can alienate children from the nationality to which their parents belong and can be used as a means of oppressing whole nationalities. Whoever controls the schools has the power to injure other nationalities and to benefit his own.

I’m going to keep reading (you should too) and hopefully write up a little sum-sum about what I’ve learned soon.

Libertarians and World Government

Brandon Christensen Law , , , , , ,

I’ve been doing a little bit of side reading on capitalism and charity and I came across some of Ludwig von Mises’s writings on foreign policy. I’ll have a longer post on his foreign policy arguments in the future (promise!) but for now lemme just say it falls roughly in line with many other classical liberals.

One interesting tidbit about classical liberals like Mises, Hayek, and Adam Smith is that they were actually very much in favor of some kind of world governing body that would be able to standardize laws and further erode the arbitrary borders drawn up by statesmen over the course of centuries. However, they were much more realistic about the practicality of such an endeavor, as well as suspicious of other kinds of international government being espoused by various thinkers (in Smith’s time, this was done by despots and Popes [same thing!], and in Hayek’s and Mises’s time this was done by despots and socialists [again, same thing!]).

This realism should not be confused, though, with opposition to an international governing body charged with codifying a standard, minimum set of global laws concerning trade, private property, individual rights, and, of course, peace.

Again, I’ll have a longer post explaining the foreign policy arguments of classical liberals in the near future, but for now this juicy little tidbit is all I can offer y’all. You can find Mises’s musings on foreign policy in his book Liberalism (available to read for free at mises.org).

Capital Day?

Brandon Christensen History , ,

Co-blogger Warren Gibson e-mailed me a great quickmeme earlier this afternoon. The details are beneath the fold. Continue reading →

Property Rights in Africa: More Decentralization Please

Brandon Christensen Current Events, Law , , , , , , , , ,

From the economist Camilla Toulmin:

While land registration is often proposed as a means of resolving disputes, the introduction of central registration systems may actually exacerbate them. Elite groups may seek to assert claims over land which was not theirs under customary law, leaving local people to find that the land they thought was theirs has been registered to someone else. The high costs of registration, in money, time, and transport, make smallholders particularly vulnerable to this.

You can read the rest of her article here [ungated version can be found here]. It goes on to elaborate upon how more decentralization is needed, as well as the need for more incorporation of indigenous legal practices. Highly recommended, but grab a cup of coffee first.

Arguments to ponder:

  1. James Buchanan’s work on public choice (elite groups seeking to capture the rent)
  2. Friedrich Hayek’s work on tacit knowledge and the inability to plan societies from the top
  3. Elinor Ostrom’s work on governing the commons and how states muddle the intricate “rules of the game”

Any thoughts? Suggestions for further reading?

Property Rights in the Post-Colonial World

Brandon Christensen Current Events , , , , , , ,

Land grabs and crony capitalism at its finest. From Reason magazine:

Politicians in the affected countries are key partners in operations that resemble the late-19th-century scramble for control of Africa. The land grabs aim at enriching privileged companies and their political allies, usually at the expense of those already on the land. States, companies, and their frequent close friend, the World Bank, see no reason to respect sitting owners and resource users, whatever their rights under customary law and (sometimes) postcolonial statutes. Pastoral nomads get even less respect. In Tanzania, for example, governments and safari capitalists have reduced the traditional grazing lands of the Maasai herdsmen to a fraction of what they were. And in Ethiopia, the government’s “villagization” policy, Pearce writes, resettles peasant farmers “in the manner of Stalin, Mao, and Pol Pot,” clearing the way for deals with foreign capital.

You can read the rest here. I hope to have some more academic articles up as links soon.

Native American Property Rights and European Contact

Brandon Christensen History, Law, Liberty , , , ,

Despite the claim to rights based on discovery, British colonists often acquired land by contract. For example, almost all of Massachusetts was acquired by purchase from local tribes. The primary exceptions there, Salem and Boston, were uninhabited areas, having been depopulated earlier by the diseases the colonists unwittingly brought with them. Although the British crown claimed the sole right to negotiate transfer of land rights from the Native Americans, many colonists thought otherwise and regularly made individual arrangements with various tribes to secure land.

This is from Europe Meets America, a heavy post in the Freeman.