1

What Is Economics About?

Economic activity. Economic thought. Xenophon, Aristotle, Rome, St. Thomas, Oresmius, Biel, Erasmus, Luther, Calvin. Mercantilism. The physiocrats. Adam Smith and the classical school. Nationalism. The Historical School. Socialism. The controlled economy. The Austrian School. The Mathematical School. The Critical School. The domain of the economic: action chosen by man in the market.

2

The Market

The autistic and the co-operative economy. The division of labor, exchange, and the market. Commerce and trade. The sovereignty of the consumer. Monopoly, economic dictatorship, and the black market.

Man is incapable of satisfying all his wants by his own unaided efforts. Individual autarky, i.e., a completely autistic, self-sufficient economy, is impossible. It is a kind of economy that is encountered only in utopias like that of Robinson Crusoe, but never in the actual life of man.

3

The Role of the Entrepreneur

Entrepreneur and consumer. Economic calculation. The data of the market. Factors and means of production. Comparative cost. Marginal utility. Diminishing returns. The time factor. Risk.

We have seen that the market is the pivot around which the whole of economic life revolves. We can say just as well that the market revolves around the entrepreneur.

4

Capital, Labor, and Wages

Utility and disutility. Production as creative. Capital and profit. Labor and wages. The “wages-fund” theory. The “iron law of wages.” The labor theory of value. “Social injustice.”

The essence of the market could be aptly described by saying that it consists in obtaining utilities in exchange for disutilities.

5

Money and Credit

Direct and indirect exchange. Barter and money. The history of money. Monetary theories. The money market. Credit and interest. Inflation and deflation. The price of money. Stable money. The gold standard.

6

Monopoly, Crises, and Unemployment

Monopoly and the French Revolution. Monopoly as a political phenomenon. Business-cycle theories. Boom and depression. Easy money. Unemployment in the modern world. Theories of unemployment. Keynes. Depression and unemployment.

7

International Trade

A quotation from Karl Marx. Caravans and trading posts. The world market. Marts, trades halls and exchanges, fairs and expositions. Commodity exchanges, warrants, and transactions at long distance and involving deferred delivery. Futures. Tribunals of commercial arbitration. Money-changers, bills of exchange, securities, and the stock exchange.

8

Nationalism and Socialism

Nationalism in antiquity. “Political economy.” “National resources.” Autarky. The balance of payments and the problem of “foreign exchange.” Dumping, import quotas, and the “black market.” Some verses of Heine. Statistics and the postulate of abundance. The “unjust distribution of wealth.” Expropriation. The socialist economy. The theory of ground rent and the doctrines of Henry George.

9

The Controlled Economy

The origin of the modern planned economy. The “weaknesses” of the system of free enterprise and their supposed remedies. The “lack of mobility of resources.” The “unjust distribution of wealth.” Redistribution and confiscation. Government control of prices and wages. Foreign-exchange controls and restrictions on international trade. Planning in the backward countries. Planning and communism.

10

What Economics Is Not About

Production, distribution, and consumption. Equilibrium. Homo economicus. Types of “business associations.” Social justice.