For as long as every living economist has been plying their trade, a single historical episode has been taken as an experimentum crucis. Latin for “crucial experiment”, it is what Isaac Newton used to call an observed outcome significant enough, by itself, of determining the validity of a theory. The event serving this function in present-day economics is the Great Depression.
Sweden and the Revival of the Capitalist Welfare State is the third updated (and first English) edition of Andreas Bergh’s well-researched book on the rise, fall, and return of the world-renowned Swedish welfare state. The work importantly traces the origins of the Swedish wonder, in which Sweden rose from being one of Europe’s very poorest to being the world’s fourth richest country in a period of 100 years.
ABSTRACT: What Engelhardt calculates in his comment is not the Marginal Efficiency of Capital. Engelhardt incorrectly ranks investment projects by Present Value instead of Net Present Value. Engelhardt does not prove that Keynes has a wealth maximizing theory of investment, so his comment is not a successful defense of Keynes’s theory.
Louis Rouanet has translated his Mises Daily article from Monday into French. Now available at Contrepoints: “Paul Krugman et la France, une longue histoire d’amour.”
Robert Wenzel recently noted just how truly international the Austrian School has become, and that the Mises Institute’s former Fellows are now teaching throughout North America and both Western and Eastern Europe.
Internationalism, incidentally, has been a focus of not only our academic efforts, but of Mises Daily as well, featuring numerous writers from Latin America, Europe, and Japan, just in the last year alone. And, we have two new interviews with Austrians from China coming in the next few weeks.
Recently the Federal Reserve reached its one hundred year anniversary. This milestone provided a nice occasion for economists to analyze the Fed’s performance in the past century. As a result in the past several years there have been many conferences, special journal issues, and books that have centered on the Fed’s centennial and its record. The present book is a collection of essays from a 2010 conference dedicated to that task.
ABSTRACT: This is a brief reply to “The Marginal Efficiency of Capital: Rejoinder.” I explain that I never intended to defend Keynes against Fuller’s (2013) criticism. Rather, I intended to highlight that Keynes’s conclusions rest on a key shortcoming in Keynes’s theory: the assumption of sticky factor prices.
ABSTRACT: In March 2014, I presented a paper on Austrian Environmental Economics in Auburn, Alabama, as the F.A. Hayek Memorial Lecture at the Austrian Economics Research Conference, sponsored by the Ludwig von Mises Institute, which was subsequently published in the Quarterly Journal of Austrian Economics (Dolan 2014b), along with comments by Art Carden (2014) and Walter Block (2014).
ABSTRACT: This brief note points out that Milton Friedman’s “Plucking Model” has not held following the Great Recession. Friedman argued that the Plucking Model offered evidence against theories like Austrian Business Cycle theory; the bust was what needed explanation, not the boom. But as many economists have pointed out, the years leading up to the Great Recession fit many of the stylized predictions of the Austrian Business Cycle.
