Value and Exchange

Praxeology is the science of human action.

Bob responds to flawed arguments about trade deficits.

Six hundred years before Carl Menger wrote his Principles, Thomas Aquinas was writing about the role of subjective valuation in economic exchanges. His work helped lay the groundwork for further advances in economic theory.

This episode explores the economic implications of deflation, debunking the mainstream fear that falling prices cripple economic growth.

Isaac Newton is best known for his development of mathematics and physics, but he also took a keen interest in economics, especially the relationship of money to economic exchange. He also believed that economic laws, like gravity, were immutable.

The Austrian school recognizes that economic analysis is timeless and the ancient story of “The Poor Man of Nippur” provides an excellent example. From time preference to the structure of production, many of the lessons are contained in this story.

In this week‘s Friday Philosophy, Dr. David Gordon looks at Allen Wood‘s attempts to salvage Marx‘s theory of exploitation. While Dr. Gordon acknowledges Allen‘s expertise in 19th-century philosophy, he notes that Allen truly misunderstands economics.

Imagination is a key aspect of abstract thinking and economics. However, many fallaciously assume that one‘s failure to imagine how something would work on a free market necessitates state provision. This is an unjustified leap in logic.

One important difference between the Austrian and other schools of thought is the emphasis Austrians place upon purposeful human behavior. Consumption by individuals is not random, but rather purposeful action driven by subjective individual preferences.

Modern academics are relentless in trying to find any nuances they can from the works of Karl Marx, but they miss the larger issues with his work. Marx was alive and active when the marginalists logically took apart his value theory, but hope springs eternal for Marx‘s supporters.