EconLog Archive
Economic Education
Two Economic Ideas That are True and Nontrivial
Timothy Taylor, at Conversable Economist, had a post on August 13 titled “What Economic Ideas are True and Nontrivial?” He starts with a famous story that Paul Samuelson told and I’ll quote it here: [O]ur subject puts its best foot forward when it speaks out on international trade. This was brought home to me years .. MORE
Central Planning
Today’s Convergence of Political Systems
In the 1960s and 1970s, a fashionable idea, at least among the Western intelligentsia, was the convergence between socialism (read: communism) and capitalism. Even less obvious than today was the true distinction between, on one side, a regime of individual and private choice and, on the other side, a system of collective and political choice. .. MORE
#ReadWithMe
We Have Never Been Woke Part 5: The Cause of Awokenings
As I mentioned in my last post, Musa al-Gharbi argues in We Have Never Been Woke that the post-2011 Awokening – that is, the rise of social justice activism and the escalating adoption of social justice ideology among the symbolic capitalist class – was not an unprecedented event. He argues that Awokenings have occurred before and have .. MORE
Cryptocurrency
Stable/Genius: Stablecoins and Free Banking
President Trump signed the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) into law on July 18th, promising to “cement American dominance of global finance and crypto technology.” In his post-signing speech, the president explained, “the GENIUS Act provides banks, businesses and financial institutions, a framework for issuing crypto assets backed one .. MORE
Property Rights
Federalism and Housing Policy
The Economist has an interesting article speculating that the red state advantage in housing affordability may be about to shrink: But what if red states’ cheap-housing advantage were to start shrinking? That may already be happening in places: a study by Edward Glaeser of Harvard University and Joseph Gyourko of the University of Pennsylvania published .. MORE
Economics and Culture
The Future of Art with AI
AI art and music are quite amazing. In seconds, you can create fun images. To wit, below is a photorealistic image I created with ChatGPT of Adam Smith and David Hume having lunch and Hume sticking Smith with the bill: Or a cartoon image of my summer bowling league team, the Cosmic Colonels: Both of .. MORE
Economic History
My Weekly Reading for August 10, 2025
Child Protective Services Investigated Her 4 Times Because She Let Her Kids Play Outside by Lenore Skenazy, Reason, August 9, 2025. Excerpt: During this visit, the social services worker acknowledged that our home was clean, that the children were happy, well-fed, polite, and well-spoken, but said the children had to be supervised 100 percent .. MORE
Incentives
Interesting Facts About the Cocoa Market
I read the Financial Times not mainly for its collectivist ideology (the preference for collective choices), but for its frequently sound reporting on economically significant phenomena and trivial-looking but important facts. I do read this newspaper partly for its collectivist editorializing, for one must not read only what confirms one’s biases; but I would still read it if it .. MORE
International Trade
Jagdish Bhagwati on Protectionism
With all the discussion of free trade, tariffs, and non-tariff barriers, I decided to pick up and quickly skim a short, delightful book by trade economist Jagdish Bhagwati. It’s his 1988 book, titled simply Protectionism. I wrote a short review of the book in the June 5, 1989 issue of Fortune. One of the issues, .. MORE
Economic and Political Philosophy
Constitutional Tradeoffs
Co-blogger Pierre Lemieux’s recent post “Can a Constitution Limit the State?” (July 21, 2025) poses an important question, one political theorists have wrestled with for millennia. In the comments section of that post, I linked to a recent paper in the Journal of Institutional Economics by Jacek Lewkowicz, Jan Falkowski, Zimin Lou, and Olga Marut (henceforth .. MORE
Supply-side Economics
Laffer Curve in the United Kingdom?
The FT has an interesting story on the British government’s attempt to boost capital gains tax revenue: The UK’s efforts to increase revenues from capital gains tax have backfired, with receipts plummeting in the wake of big cuts in allowances. The government’s CGT take fell 18 per cent from the previous year to £12.1bn in .. MORE
#ReadWithMe
We Have Never Been Woke Part 4: Why Are Symbolic Capitalists Woke?
This is the fourth part of my exploration of Musa al-Gharbi’s We Have Never Been Woke. (Part 1, Part 2, Part 3). As we’ve seen, al-Gharbi spends a good deal of time establishing the demographic of people who are most likely to end up being “woke” as he described the term. And that group is overwhelmingly .. MORE
Economic and Political Philosophy
Equality Before the Law, Equality of Permission, and the Language of Libertarianism
When we communicate with one another, how we say things can sometimes be as important as what we actually say. Words matter, which is even more true when we exchange ideas and try to convince others to embrace our viewpoints. Ideological rhetoric, then, merits some thought on the part of libertarians. Of course, libertarians uphold .. MORE
Tax Reform
Who Got the Biggest Percentage Tax Cuts?
The answer may surprise you. In so much of the discussion of tax cuts, whether of the recent one or previous tax cuts, we hear that the highest-income people got the biggest tax cuts. Of course, they did. They pay a disproportionately high percent of overall federal taxes. So it shouldn’t be surprising that they .. MORE
Economic Methods
Accounting Identities and Economic Theories
The relationship between accounting identities and economic models is frequently misunderstood. An accounting identity is an equality that must be true, by definition. It is tautology. It is meant to categorize and organize relationships between variables. For example Assets = Liabilities is an identity. Regardless what “assets” equals, “liabilities” must be the same amount. We .. MORE
#ReadWithMe
We Have Never Been Woke Part 3: Symbolic Capital and Symbolic Capitalists
The previous post in this series touched on Musa al-Gharbi’s identification in We Have Never Been Woke of a class of people as “symbolic capitalists,” his contention that wokeness is the dominant ideology of this group, and that members of this group tend to be most predisposed to amplifying woke ideas. There are multiple “alternative names .. MORE
Economic and Political Philosophy
Sorts of Deals
A deal is an agreement to exchange something for some consideration, but different sorts of deals exist. A deal is not necessarily a free exchange and a free exchange is not necessarily a free-market exchange. The gold standard of all deals is a free-market exchange: a voluntary exchange where alternative demanders and suppliers exist. The .. MORE
Cryptocurrency
Magical Thinking
I worry that people are looking for quick fixes to our current fiscal problems, when in fact we will need to take painful steps in order to get fiscal policy back to a sustainable track. In this post, I’ll look at three recent examples: Here is Arthur Sants: The administration’s “crypto czar” David Sacks told .. MORE
Liberty
My Weekly Reading for August 3, 2025
Canada Seeks To Jail Freedom Convoy Organizers for 8 Years by J.D. Tuccille, Reason, July 30, 2025. Excerpt: While Americans rightfully resent the lockdowns, mask mandates, and other intrusions into their liberty that accompanied the COVID-19 pandemic (not to mention politicians’ flouting of their own rules), most of us had it pretty easy compared to people .. MORE
Economic History
Diocletian, the Roman Empire, and Forever Failing Price Controls
The Roman Empire was in trouble. During the fifty-plus years known as the Crisis of the Third Century (235-284 AD), the throne of Rome changed some 26 times, with the Roman Army engaging in a steady diet of crowning and removing claimants to the throne. These autocrats, known as “barracks emperors,” because they often came .. MORE
#ReadWithMe
We Have Never Been Woke Part 2: Of “We” and “Wokeness”
At the end of my last post, I said I’d be following up by describing both some of Musa al-Gharbi’s modes of analysis and assumptions in his book We Have Never Been Woke, and outline who is the “we” he describes, and what he means by “woke.” First, the ground rules. Musa al-Gharbi sets out .. MORE