2014-01-03
Apparently George Orwell reviewed The Road to Serfdom (alongside The Mirror of the Past by K. Zilliacus) and liked a lot of it. It cannot be said too often – at any rate, it is not being said nearly often enough – that collectivism is not inherently democratic, but, on the contrary, gives to a tyrannical minority such powers as the Spanish Inquisitors never dreamed of. Professor Hayek is also...
2014-01-02
In 1944, Hayek published The Road to Serfdom as a battle cry against collectivism and an affirmation of core liberal principles. It was such a smashing success that in 1945 Reader’s Digest published a condensed version. According to John Blundell, “Hayek thought it impossible to condense but always commented on what a great job the Reader’s Digest editors did.” It is in this spirit that I feel...
2013-12-30
Bordo and Redish published " Is Deflation Depressing? Evidence from the Classical Gold Standard " in 2003. I have not seen it cited in my research. Their findings are under appreciated. They conclude that only changes in aggregate demand, particularly changes in demand for gold, had a long run impact on the price level during the classical gold standard, although increase in output had short run...
2013-12-22
Perhaps the prime problem that society faces is that of violence. Every individual is capable of violence. And even if 99 percent of individuals do not engage themselves initiate violence, the actions of the few that do employ violence, if left unchecked, can be terminally destabilizing for society. The hallmark of modern society is the existence of robust institutions that constrain violence,...
2013-12-01
I’ve been making my way through one of Ralph Hawtrey’s classic works, The Gold Standard in Theory and Practice . The book is both highly readable and insightful. Of interest today is Hawtrey’s narrative of the classical gold standard. Gold and silver were both used for exchange in commerce throughout much of recorded history. It was not until the 1870s that the western world moved to a uniform...
2013-11-20
In 1990, Milton Friedman published “ Crime of 1873 ”, an article that comprised a chapter in his Money Mischief – a book that is generally underappreciated, though not by some of my favorite monetary theorists . Friedman’s thesis is that the Crime of 1873 was actually a crime, though perhaps not in the legal sense: Whether or not a verdict of "guilty" would have been appropriate in a court of law...
2013-11-16
A couple weeks ago I came across George Selgin’s work on Great Depression era monetary theory. In “ Hayek vs. Keynes on How the Price Level Ought to Behave ” Selgin notes many of the same issues that I have been recently reviewing. Of particular interest is Hayek’s changing views on deflation and price level stability. Hayek started in the 1920s with “a general indifference to deflation, whatever...
2013-11-12
I’ve recently grown interested in testing the predictive value of changes in relative prices as opposed to changes in the price level. So when I found myself with a few extra hours the other day, I ran some preliminary tests using the Saurbeck-Statist Index. The Sauerbeck-Statist Index was published yearly from 1846 to 1948. It employs several baskets of commodities that are merged to form...
2013-11-02
I am currently busy working on a new project which has kept me away from blogging over the last week. In researching I have stumbled upon a fact that is revealing of late Hayek. It seems that he never came to terms with absolute inability of government adhere whatsoever to any fixed standard. In Denationalization of Money , he writes: One might hope to prevent the violent fluctuations in the...
2013-10-29
In 1949, Hayek reflected on the success of socialist ideology and the waning of classical liberalism: In particular, socialist thought owes its appeal to the young largely to its visionary character; the very courage to indulge in Utopian thought is in this respect a source of strength to the socialists which traditional liberalism sadly lacks. He closes the article by arguing: We must make the...