I went to the lecture notes page. Unfortunately Smith's quotes link is broken (the other links seem to be fine).
Have you considered transforming this course into a book? I believe that's what you did with legal systems very different from ours which was fantastic.
The Smith Quotes are now there. I don't know why they were missing, probably carelessness by me that nobody ever noticed, some evidence that my students were not using the webbed notes.
Price Theory, Law's Order, and Legal Systems all started as courses. I'm not sure enough people are interested in History of Economic Thought (not to be confused with Economic History) to make it worth writing a book on it.
I'm also not sure there isn't a good book on the subject already. I was working entirely from the primary sources, which I think is better than feeding the students a version of the ideas filtered through some modern author — it's too easy for a history of thought class to turn into a class on learning factoids about lots of past people instead of actually learning their ideas.
At UCLA I started the class by telling the students to imagine they were grad students in 1780 or so, _The Wealth of Nations_ was the latest thing in the field, and they were getting ready for their prelims. It was a class in thought, not history. One of my long term methodological heresies comes from learning the relevant ideas from Marshall, who invented them, instead of from a modern textbook.
I do wonder if I could do an interesting post here on History of Economic Thought.
Also, I'm not teaching any more, haven't taught that course for a long time, although I still have the lecture notes. And I can't use my trick for getting a book finished, which is to assign it for the next year and then have to finish each chapter by the time the students are assigned to read it.
I last taught the course a very long time ago, and although I am pretty sure that I found a secondary source that was pretty good I no longer remember what it was and can't find it in my shelves.
George Stigler has written a good deal on the subject and is pretty reliable, but not a survey. I haven' seen Tyler's book.
I don't think so. I have written one such already, _Hidden Order_, and don't have a book's worth of additional material.
I have considered converting the posts on one topic, such as climate change, or perhaps two or three, into a book. What I have to say on one topic is a lot of posts but would be a very short book.
You write ". . . but would be a very short book" as if that would be a bad thing. I think that would be a very good thing. The clarity of your exposition is matched by your selection of topics to discuss, as is illustrated by your blog and substack. With another book -- even a short one -- more people will get the benefits that we regular readers enjoy. Sincere thanks and if I may use an expression, god bless.
Framing Coase's insight about firms in opposition to Mises' insight about central planning is misleading. Firms are embedded in markets, and face market prices for their capital and all their inputs. Coase's insight was that there are many potential margins for economizing created by the possibility of organizing a firm vs. contracting out labor. They can avoid doing something in house, but they cannot avoid buying their inputs on a market. The firm can arrange its activities internally or externally according to what they expect to bring most profit. A central planner has no access to real prices for either consumer goods or capital equipment, and hence has no numbers to use other than their own fallible estimates, high can at best provide only minimal and error prone guidance regarding how best to organize production. Perhaps they can succeed in producing as they prefer, but not as consumers prefer. The two ideas are not in conflict, except from a rather distorted first glance perspective. I’m surprised that a careful scholar such as our host would go along with such a careless misconception.
A better criticism of Mises might be to ask to what degree the state can calculate economically, since they also face market prices for their inputs. I think the answer probably lies in their immunity from the necessity of selling their output on a market for a profit.
The Coase theorem is false, or rather its premises are contradictory since there's no way to make a clear distinction between negative externalities and coercion.
What a beautiful pedagogy! There are indeed some very bright simple ideas. But for other simple ideas, it is not enough to express them for them to become simple. They become simple when you explain them to us, my dear sir.
Apropos the bomber example is Dwight Eisenhower's suggestion to the question of where to build the sidewalks on the campus of Columbia University when he was its president. He suggested not building it until the students' patterns of traversing the campus was clear, i.e. follow their footprints.
I've found Conway's Law to be both beautifully simple and incredibly deep and powerfully explanatory. Lots of good videos on the topic, I recommend "The Only Unbreakable Law" as a good place to start.
You're an economist I've watched a video by economist claiming Trump's policies will be worser on the deficit then kamales pierce the video of economist could you take a look at it https://m.youtube.com/watch?v=vv7TzklhPkk
Since we don't know either what Trump's policies will be or what Kamala's would have been, I don't think they can know that. I take that sort of statement as just meaning that they support Kamala.
Like most economists I believe that tariffs hurt the country that imposes them — I've sketched the reasons here: https://daviddfriedman.substack.com/p/ptolemaic-trade-theory. Trump will probably have more tariffs than Kamala would have, which is bad. But it's possible that he will just use the threat of tariffs to get other countries to lower theirs, which would be good.
Similarly, Trump says he will reduce regulation and the size of government, which would be good, but I'm not counting on it happening. The last president to substantially reduce regulation was Carter. Vance's economic views feel to me more like 1960's Democrat positions than 1960's Republican.
I found this post brilliant (possibly because I came up with at least two of the examples you make upon reading the first lines of the post).
I would have a sort of personal question on the permanent income hypothesis. You attribute it to Milton Friedman: what part had Rose Friedman in coming with this ‘brilliantly simple’ idea?
The question comes from my coming across the following passage in a recent post by Brad Delong:
In 1997, Milton Friedman did write: “My vocation has been professional economics. Except for… The Theory of the Consumption Function… Rose played a secondary role… reading and critiquing everything that I wrote but not being a major participant. My avocation has been public policy, and in that area Rose has been an equal partner, even with those publications, such as my Newsweek columns, that have been published under my name.”
But The Theory of the Consumption Function and its permanent income hypothesis were what Milton Friedman was best known for until he and Anna Schwartz published their Monetary History of the United States in 1963.
One is tempted to ask: should not The Theory of Consumption have been published under the name of Milton and Rose Friedman (if Rose Friedman had a academic career to advance other than that of her husband)?
My understanding is that it partly came out of work on consumption that my mother and one or two other female economists who were friends of theirs, probably Margaret Reid, maybe Dorothy Brady, had done. My guess is that the final result, the permanent income hypothesis, was my father's, because it is his sort of idea, but I don't actually know.
Thanks David!
I went to the lecture notes page. Unfortunately Smith's quotes link is broken (the other links seem to be fine).
Have you considered transforming this course into a book? I believe that's what you did with legal systems very different from ours which was fantastic.
The Smith Quotes are now there. I don't know why they were missing, probably carelessness by me that nobody ever noticed, some evidence that my students were not using the webbed notes.
Price Theory, Law's Order, and Legal Systems all started as courses. I'm not sure enough people are interested in History of Economic Thought (not to be confused with Economic History) to make it worth writing a book on it.
I'm also not sure there isn't a good book on the subject already. I was working entirely from the primary sources, which I think is better than feeding the students a version of the ideas filtered through some modern author — it's too easy for a history of thought class to turn into a class on learning factoids about lots of past people instead of actually learning their ideas.
At UCLA I started the class by telling the students to imagine they were grad students in 1780 or so, _The Wealth of Nations_ was the latest thing in the field, and they were getting ready for their prelims. It was a class in thought, not history. One of my long term methodological heresies comes from learning the relevant ideas from Marshall, who invented them, instead of from a modern textbook.
I do wonder if I could do an interesting post here on History of Economic Thought.
Also, I'm not teaching any more, haven't taught that course for a long time, although I still have the lecture notes. And I can't use my trick for getting a book finished, which is to assign it for the next year and then have to finish each chapter by the time the students are assigned to read it.
But it's a thought.
Thanks.
If you have recommendations for books on the topic of history of economic thought, I'll take a look.
Tyler Cowan has a new book about the subject called GOAT, but I haven't read it yet.
I last taught the course a very long time ago, and although I am pretty sure that I found a secondary source that was pretty good I no longer remember what it was and can't find it in my shelves.
George Stigler has written a good deal on the subject and is pretty reliable, but not a survey. I haven' seen Tyler's book.
An exquisite selection, clearly expounded. Do I see the seeds of a popular book on economics?
I don't think so. I have written one such already, _Hidden Order_, and don't have a book's worth of additional material.
I have considered converting the posts on one topic, such as climate change, or perhaps two or three, into a book. What I have to say on one topic is a lot of posts but would be a very short book.
You write ". . . but would be a very short book" as if that would be a bad thing. I think that would be a very good thing. The clarity of your exposition is matched by your selection of topics to discuss, as is illustrated by your blog and substack. With another book -- even a short one -- more people will get the benefits that we regular readers enjoy. Sincere thanks and if I may use an expression, god bless.
I've heard the SRG bomber idea was mostly attributable to Freeman Dyson (who worked in the SRG during the war). If so, he deserves mention.
This is one of my favorite posts of yours.
Framing Coase's insight about firms in opposition to Mises' insight about central planning is misleading. Firms are embedded in markets, and face market prices for their capital and all their inputs. Coase's insight was that there are many potential margins for economizing created by the possibility of organizing a firm vs. contracting out labor. They can avoid doing something in house, but they cannot avoid buying their inputs on a market. The firm can arrange its activities internally or externally according to what they expect to bring most profit. A central planner has no access to real prices for either consumer goods or capital equipment, and hence has no numbers to use other than their own fallible estimates, high can at best provide only minimal and error prone guidance regarding how best to organize production. Perhaps they can succeed in producing as they prefer, but not as consumers prefer. The two ideas are not in conflict, except from a rather distorted first glance perspective. I’m surprised that a careful scholar such as our host would go along with such a careless misconception.
A better criticism of Mises might be to ask to what degree the state can calculate economically, since they also face market prices for their inputs. I think the answer probably lies in their immunity from the necessity of selling their output on a market for a profit.
The Coase theorem is false, or rather its premises are contradictory since there's no way to make a clear distinction between negative externalities and coercion.
https://unenumerated.blogspot.com/2008/05/coase-theorem-is-false-contracts-depend.html
What a beautiful pedagogy! There are indeed some very bright simple ideas. But for other simple ideas, it is not enough to express them for them to become simple. They become simple when you explain them to us, my dear sir.
Apropos the bomber example is Dwight Eisenhower's suggestion to the question of where to build the sidewalks on the campus of Columbia University when he was its president. He suggested not building it until the students' patterns of traversing the campus was clear, i.e. follow their footprints.
Re: Coase, I am fascinated by his insight that harms are always "reciprocal"; see: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4210659
I've found Conway's Law to be both beautifully simple and incredibly deep and powerfully explanatory. Lots of good videos on the topic, I recommend "The Only Unbreakable Law" as a good place to start.
You're an economist I've watched a video by economist claiming Trump's policies will be worser on the deficit then kamales pierce the video of economist could you take a look at it https://m.youtube.com/watch?v=vv7TzklhPkk
Since we don't know either what Trump's policies will be or what Kamala's would have been, I don't think they can know that. I take that sort of statement as just meaning that they support Kamala.
Like most economists I believe that tariffs hurt the country that imposes them — I've sketched the reasons here: https://daviddfriedman.substack.com/p/ptolemaic-trade-theory. Trump will probably have more tariffs than Kamala would have, which is bad. But it's possible that he will just use the threat of tariffs to get other countries to lower theirs, which would be good.
Similarly, Trump says he will reduce regulation and the size of government, which would be good, but I'm not counting on it happening. The last president to substantially reduce regulation was Carter. Vance's economic views feel to me more like 1960's Democrat positions than 1960's Republican.
I found this post brilliant (possibly because I came up with at least two of the examples you make upon reading the first lines of the post).
I would have a sort of personal question on the permanent income hypothesis. You attribute it to Milton Friedman: what part had Rose Friedman in coming with this ‘brilliantly simple’ idea?
The question comes from my coming across the following passage in a recent post by Brad Delong:
In 1997, Milton Friedman did write: “My vocation has been professional economics. Except for… The Theory of the Consumption Function… Rose played a secondary role… reading and critiquing everything that I wrote but not being a major participant. My avocation has been public policy, and in that area Rose has been an equal partner, even with those publications, such as my Newsweek columns, that have been published under my name.”
But The Theory of the Consumption Function and its permanent income hypothesis were what Milton Friedman was best known for until he and Anna Schwartz published their Monetary History of the United States in 1963.
One is tempted to ask: should not The Theory of Consumption have been published under the name of Milton and Rose Friedman (if Rose Friedman had a academic career to advance other than that of her husband)?
My understanding is that it partly came out of work on consumption that my mother and one or two other female economists who were friends of theirs, probably Margaret Reid, maybe Dorothy Brady, had done. My guess is that the final result, the permanent income hypothesis, was my father's, because it is his sort of idea, but I don't actually know.