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Index
Acemoglu, Daron 273
Acheson, Dean 277
Ackley, Gardner 321
Adenauer, Konrad 235
Akerman, Johan
warning of impending 1929 bust 76
Allais, Maurice 268, 269
American Economic Association 19, 22, 110, 307
opposition to laissez-faire 115
anarcho-capitalism 17, 25, 205, 239
Association for Private Enterprise Education 215
Attlee, Clement 173, 174
opposition to free market economy 175
Austrian business cycle theory.
See under business cycles, Austrian theory of
Austrian economics 3, 12, 36, 72
C. Menger’s theory of price formation 226
capital theory
C. Menger’s contribution to 78
criticism of 91
E. von Böhm-Bawerk’s contribution to 78, 80, 85–86
Hayekian triangle 78–80
emergence of money 226–29
interest
E. von Böhm-Bawerk’s contribution to theory of 85–86
equilibrium rate as intertemporal price coordinating saving and investment 85–86
Wicksell’s contribution to theory of 86
opposition to Real Bills Doctrine 97
and spontaneous order theory 224–25
Ayres, Clarence 109
Bailey, Martin J. 396
Balaam, David N. 11
Bank of England 87, 281, 283
Bank Charter Act of 88, 402–03
Banking School 89–90
and real bills doctrine 89
Barro, Robert J. 397, 400–01
on size of the spending “multiplier” 404
Bastiat, Frederic 243, 368–69
Candlemaker’s petition 368–69
Bauer, Otto 35
Bauer, Peter 246, 252, 262, 272
biography 270
on India’s Second Five-Year Plan 255
Bellamy, Edward 117
Bentham, Jeremy 20, 191–93, 339
on economic policy and the role of government 195
Bergson, Abram 63
evaluation of socialist calculation debate 65
Berle, Adolf A., Jr. 110
Bernanke, Ben 299
Beveridge, William 164, 184
Bhagwati, Jagdish 250, 264
on influence of Western economists on Indian economists 250
support for liberalization of Indian economy 264–65
bimetallism 288–93
and inflation 291–93
international 289
Boettke, Peter 33
Böhm, Franz 235, 239, 244
Böhm-Bawerk, Eugen von 35, 44, 78, 317
contribution to capital theory and Austrian economics 85
Boldrini, Marcello 268, 269
Bolshevism 28
influence in central Europe 34
Revolution of 1917 3
Bordo, Michael D. 299
Boudreaux, Donald 362
Brain Trust, FDR’s 102, 110
Bretton Woods 4, 237, 309, 361
conference and agreement 275–78
foreign exchange under 300–02
international monetary system after 277
and J. M. Keynes 275, 276–78
and Keynesian economic policies 277
objectives of 300
system’s end 300–02
Bright, John
and Anti-Corn-Law League 371–72
Bronfenbrenner, Martin 257
Brunner, Karl 320
Brutzkus, Boris 33
Bryan, William Jennings 189
and bimetallism 292
Buchanan, James M. 7, 230, 335, 356, 357–59, 398
critique of Keynesian economics.
See public finance, J. M. Buchanan and R. Wagner on
and Public Choice 355
budget deficits.
See under public finance
Burkhead, Jesse 388
Burns, Arthur 306, 309, 310
T. Joplin-F. A. Hayek scenario of concerted overexpansion of credit 87
Austrian theory of 14–15, 72, 73–82
characterization as ‘hangover’ theory of recession 82
evidence in support of 76
F. A. Hayek contra J. M. Keynes and M. Friedman 82
F. A. Hayek’s contribution to 71, 75–76
J. M. Keynes’ objection to 77
L. v. Mises’ contribution to 71, 73–74
malinvestment 73
summary of F. A. Hayek’s version of 81–82
view of bust and recession 76–77
Austrian vs. Monetarist theories of 328–29
and central banking 72, 73–74
F. A. Hayek on price stablization policy and 82–85
F. A. Hayek’s policy prescription for 82–84
and free banking 74–75
Keynesian theory of 72
L. v. Mises’ policy prescription for 74–75
Monetarist theory of 323
pre-Keynesian theories of 71–72, 88–90
Banking School 89–90
comparison between schools 88–90
Currency School 88–89
difference between Mises and Hayek’s position on 89
Free Banking School 89
policy prescriptions of 72
underconsumption theory of 103–06
F. Engels on 104
J. A. Hobson on 105
J. M. Keynes’ criticism of 105
R. Tugwell on 103–04
Wicksell’s cumulative process 87
See under business cycles
Caldwell, Bruce 169
Cambridge, Univ. of 12, 13, 247, 372, 376
Cannan, Edwin 212, 219
capitalism
use of term 10–11
See also free-market economy
Caplan, Bryan 357
Castle, Barbara 175
Cato Institute 270
central banking 27
and gold standard 283, 298–300
and inflation 302–05
L. v. Mises on potential for overexpansion of money and credit under 87
central planning 33
and development economics.
See development economics, and central planning
and freedom of choice 166
in India.
See under India, and central planning
and individual liberty 15, 17, 100, 164–68
movement in liberal nations towards 161–64
tendency toward totalitarianism under 164–68
unintended consequences of 168
Cesarano, Fillipo 302
Chang, Ha-Joon
on infant industry argument 372
Cheung, Steven 345
Chicago, Univ. of 6, 16, 203, 272, 310, 320, 330, 332
Chidambaram, P. 261
Choudhri, Ehsan U. 299
Churchill, Winston 173, 174
Clark, John Bates 188
Clark, John Maurice 72, 109
classical economics
J. M. Keynes’ use of label 71
labor theory of value 43–44
monetary theory 278–87
and public finance 386
classical liberalism 15, 16, 26, 155, 165, 168, 169, 194, 195, 196, 201, 205, 241
as alternative ‘road’ 168
and conservatism 230
influence on A. Smith 216
intellectual climate of opinion towards 202
and F. A. Hayek 4, 15, 168, 203, 208, 230
and M. Friedman 310
and Mont Pelerin Society 205
and Ordoliberalism.
See Ordoliberalism
political economy of 208
and Public Choice 359
and spontaneous order theory 229–30
tradition of 208–09
Clay, Gen. Lucius 231
Coase, Ronald 332–33, 346
on A. Smith and invisible hand 347
biography 346–47
Coase Theorem.
See Coase Theorem
and externalities 347–49
on German Historical School 115
on role of property rights 348
Coase Theorem 332–33, 347–49
limits of 349–52
and transactions costs 349–52
Cobden, Richard
and Anti-Corn-Law League 371–72
Cockett, Richard 206
Cole, G. D. H. 179, 185
colonialism 364
Columbia Univ. 10, 99, 110, 250, 271, 309, 322
Commons, John R. 19, 22, 109
Communism
Russian 17
Communist Manifesto 29
comparative advantage 224, 366–68
A. Smith on 366
and case for free trade 366–68
D. Ricardo on 368
J. S. Mill on 372–73
versus absolute advantage 367, 368
Conquest, Robert 182
constitutional political economy.
See under Public Choice
consumer sovereignty 160
coordination problem 224–25
Corn Law, Great Britain 366
Anti-Corn-Law League 371–72
popular opposition to 370–72
corporativism.
See fascism
crony capitalism.
See under state capitalism
Currency School 88–89, 71, 87
support for monetary rule 89
See under business cycles, pre-Keynesian monetary theories of
Davanzati, Bernardo 318
Davis, Arthur K. 117
De Soto, Hernando 274
deficit spending.
See under public finance
DeLong, J. Bradford 322
on socialist calculation debate 66
development economics 267–70, 271–74
and central planning 267–70
and econometrics 268–69
endogenous growth theory 272
Harrod-Domar model 256, 268, 271
and role of institutions 272–74
Solow model 271
‘underdevelopment trap’ 267–68
diamond-water paradox 44, 45
Director, Aaron 203, 332
division of labor 42, 211–13
Dobb, Maurice 48, 190
Dobbs, Lou 362
Domar, Evsey 256
Durbin, Evan 177
Easterly, William 271
Eckstein, Otto 391
on public finance 391
econometrics 268
economic policy
experiments in 1
major issues and debates 1, 3–4
role of government 8–11
economics
policy relevance 2
positive versus normative 9–10
economists
and collapse of Soviet socialism 63–67
ideology of 18–25
policy disagreements 2
political influence 2, 5–7, 19–20
support for interventionism 18–25, 252
Edie, Lionel D. 297
Eichengreen, Barry 97, 298–99
Ely, Richard T. 19, 22, 109
ideology of 117
Engels, Friedrich 28, 30
Entrepreneurship 42
Erhard, Ludwig 231, 232
biography 233–35
and decontrol of German economy 231
Eucken, Walter 158, 202, 204, 234, 235, 237, 239, 245
biography 241–42
eugenics.
See under Progressivism, and eugenics
European Central Bank 383, 406
European Union 383
externalities 23, 25, 332
and Coase Theorem.
See Coase Theorem
government regulation of 50, 51, 345
internalization of.
See Coase Theorem
Pigou on 344–45
Pigovian taxes on 344
positive 343
and property rights 348
public goods as positive 343–44
R. Coase on 347–49
Fabian socialism 162, 187
economics and ideology of 187
economics of 189–91
influence of Georgism on 187, 189
influence of J. S. Mill on 201
influence on Indian economic policy 247–50
Fabian Society 4, 178, 179, 183, 201, 203, 204, 208
overview of 178–79
political influence of 179
fascism 100–01
ambiguous economic principles of 155–57
as economic policy system 100
Federal Reserve 306
Act of 1913 27
banking system 19, 27
effect of Real Bills Doctrine on monetary policy of 95, 98
and financial crisis of 2007–08 327
and gold standard 297
“Monetarist Experiment” 309
Monetarist proposals to constrain 326–28
policy during 1920’s economic boom and bust 69–70
policy, post-WWII 307–08
Quantitative Easing 409
role in Great Depression 310–13
Feldstein, Martin 402
Ferguson, Adam 222
influence on A. Smith 222
Finer, Herman 170
fiscal policy.
See under public finance
Fisher, Antony 205
Fisher, Irving 22, 24, 72, 322, 329, 339
biography 316–18
on economic policy and the role of government 25
on economists and laissez-faire 24, 25
on externalities 25
on gold standard 68
and loss of personal fortune in 1929 stock market crash 68
optimism before 1929 crash 150
Quantity Theory of Money 314
Fitzpatrick, Sheila 38
Flynn, John T.
on New Deal and fascism 101
Foldvary, Fred E. 341
Foundation for Economic Education 203, 204
free banking 25, 27, 74–75, 281–82
A. Smith on 217–18
business cycles.
See under business cycles, and free banking
F. A. Hayek on 83
L. v. Mises on 74–75
M. Friedman on 328
Free Banking School 89, 281–82, 87
See under business cycles, pre-Keynesian monetary theories of
free-market economy 10
free trade.
See trade policy, free trade
Freiburg School.
See Ordoliberalism
Friedman, David D. 17
Friedman, Milton 4, 7, 128, 151, 152, 154, 202, 203, 306, 332, 360
biography 309–10
criticism of central planning in India 263–64
criticism of F. A. Hayek’s business cycle policy prescriptions 93
criticism of Federal Reserve policy 306–07
critique of Keynesian economics 313–14
on economic policy 1929 bust 82
on free trade 360
methodology 330
on Mont Pelerin Society 204
policy prescriptions.
See under Monetarist economics, policy proposals
and Public Choice 335
on socialism and academia 163
on trade wars 379
Frisch, Ragnar 252, 268
Fullarton, John 89
Galbraith, James
on J. K. Galbraith and mainstream influence of Institutionalist economics 109
Galbraith, John Kenneth 8, 113, 124, 150, 249, 252, 253
on economic policy and the role of government 124–25, 334
as mainstream economist 109
on Mont Pelerin Society 205
on post-WWII economic policy in Germany 232
support for central planning in India 253–54
Gandhi, Indira 259
Gandhi, Mohandas 247
economic philosophy of 247
Garrison, Roger 93
General Agreement on Tariffs and Trade 361
general equilibrium theory 49, 61, 330
George, David Lloyd 27
George, Henry 187–89
criticism of infant industry argument 376
support for free market economy 190
Georgism 187–89
criticism by economists of 188
German Historical School 112, 113–16, 160, 236, 375
dismissal of economic theory 115
influence on Institutionalist economics 113–16
German National Socialism.
See Nazism
Germany
postwar decontrol of economy 231, 232–33, 236
postwar economic conditions of 231–32
under Nazism.
See Nazi Germany
Geršl, Adam 237
Gilbart, James William 89
global warming.
See under market failure, pollution
globalization
first age of 26
recent trend toward greater 361
Goerdeler, Carl 234
gold standard 4
A. Marshall and I. Fisher on 293–94
bimetallism.
See bimetallism
and Bretton Woods.
See Bretton Woods, conference and agreement
and central banking 283
and classical economics 278–87
F. A. Hayek on 84, 276, 297
and Federal Reserve 297
in Great Britain 276, 295
and Great Depression 298–300
and inflation 287–88
as international monetary system 275
J. M. Keynes on 14, 276
M. Friedman on 325
monetary policy under 277, 298–300
price-specie-flow mechanism 279–80
rise and fall in popularity of 282
in United States 276, 287, 293, 295, 302
and WWI 295–98
end of 309
Goldschmidt, Nils 240
Göring, Herman 157
government
failure, 352.
versus market failure 338, 352
public goods and 336–38
See under Public Choice
Great Britain 4, 20, 180, 181, 276
nationalization of industry in 177–78
postwar policies in 175, 176–78
Great Depression 3, 27, 70, 81, 92, 94, 99
contrasting views of M. Friedman, F. A. Hayek, and J. M. Keynes on 312
criticism and effect of F. A. Hayek and L. Robbin’s policy prescriptions for 93–95
explanations for slow recovery 128–29
extent of 127
and gold standard 298–300
J. M. Keynes’ explanation for cause of 129
M. Friedman and A. Schwartz’ monetary explanation for cause of 128, 310–13
money supply during 146
policy response to 131
and Real Bills Doctrine 98, 311
Hoover administration 94
Roosevelt administration.
See New Deal
Greece 382
public finance issues in.
See under public finance, sovereign debt crisis
Greenspan, Alan 304
Gresham’s Law 290–91
D. Ricardo on 290
Grossmann-Doerth, Hans 235
Gwartney, James D. 403
Haberler, Gottfried 72
Hamilton, Alexander 336, 373
on free trade and protectionism 373–75
Hansen, Alvin 77, 151, 386, 387, 391, 395
on Austrian business cycle theory 81
on inevitability of central planning 163
Harding, Warren G. 27
Harper, F. A. 203
Harrod, Roy 256
Hawtrey, Ralph 72
Hayek, Friedrich A. 3, 12, 36, 39, 54, 262, 317, 328
biography 14–16
on British inter-war mixed economy 161
business cycle theory of.
See under business cycles, Austrian theory of
and classical liberalism.
See classical liberalism, and F. A. Hayek
on competition as discovery process 61–62
contra J. M. Keynes 17–18, 77, 91
on Prices and Production 91
on policy response to Great Depression 131
on short-run policy focus 148
Criticism
of Federal Reserve policy during 1920’s 98
of Real Bills Doctrine 98
criticism received
for alleged ‘do-nothing policy’ prescriptions 93–94
for business cycle theory 90–92
N. Kaldor on 90–91
for capital theory 92
for monetary policy 92
for Prices and Production 90, 91
E. v. Böhm-Bawerk’s influence on 85
on economic coordination 56–57
on economic policy and the role of government 17
on gold standard.
See under gold standard, F. A. Hayek on
Hayekian triangle 78–80
influence of L. v. Mises on 14
on the influence on Ordoliberalism 237
on Institutionalist economics 116
introduction to economics 12
on knowledge problem 42, 53–58
and entrepreneurship 54
nature of problem 54–55
on L. v. Mises 35
monetary policy prescriptions 97
and Mont Pelerin Society 207
on need for liberal Utopia 208
Prices and Production 72
Pure Theory of Capital, The 92
response to criticism of business cycle theory 92
Road to Serfdom,The 4, 7, 15, 17, 164–68, 169, 177, 184
See also central planning, and individual liberty
on similarities between fascism and socialism 100, 156, 164–65
and socialist calculation debate 53–61
on policy response to Great Depression 131
on prices and production 91
on short-run policy focus 148
spontaneous order theory of.
the influence of ideas and intellectuals 5
on the term ‘capitalism’ 11
See spontaneous order, theory, of Hayek
on threat to liberty from central planning 164–68
on unintended consequences of central planning 167
on ‘why the worst get on top’ 166
wider intellectual influence of 61–63
Hazlitt, Henry 169, 203
Heidegger, Martin 241
Heilbroner, Robert
on socialist calculation debate 66
Henderson, Leon 113
Hicks, John 151, 339, 395
Hirshleifer, Jack 33
Hitler, Adolf 100, 155, 157
economic policy of 155
Hobbes, Thomas 336
Hobson, J. A. 345
on economic policy and the role of government 105
on imperialism 105
influence on R. Tugwell 104
on underconsumption 105
Hodgskin, Thomas 197
Hoover, Herbert
response to Great Depression 94
Hoover Institution 310
Horwitz, Steven 224, 229
Hume, David 221
on gold standard.
See gold standard
See under and classical economics
influence on A. Smith 222
theory of price-specie-flow mechanism 222
Hutcheson, Francis 219
hyperinflation 74, 88, 237
ideas, economic
clash of 1
origin and spread of 7–8
political influence 5–7
income redistribution 23, 50
as a public good 353–55
India 246
and central planning 248, 253–58
M. Friedman criticism of 263–64
corruption and interventionism in 259–61
economic interventionism in 259–61
economic liberalization of 264–66
economic policy following independence of 247–48
influence of Fabian socialism in 247–50
‘Permit Raj’ 259
black markets under 261
Second Five-Year Plan 246, 258
slow economic growth in 261
inflation
and bimetallism 291–93
and central banking 302–05
and gold standard 287–88
and government revenue.
See under seigniorage
“Great Inflation” 303, 308
input-output analysis 258
in United States 307–08, 309
Keynesian theories of 308, 322
Monetarist theory of, 306.
See Quantity Theory of Money
under commodity and fiat standards 302–05
wage and price controls as policy response to 306, 307
Institute of Economic Affairs 205
Institutionalist economics 3, 18–20, 109
German Historical School’s influence on 113–16
political and professional influence of 108–10
support for New Deal 109
institutions 272
and economic development 273–4
interest rate
market versus natural rate 86
International Monetary Fund 276, 301, 383
interventionism 9
economics as science of 19
and fascism 157
financial and monetary 27
paternalist 112
invisible hand 16, 214–16, 229, 238, 250, 268, 347
and market failure 341
R. Tugwell on 9, 111
See under spontaneous order
Ireland.
See under public finance, sovereign debt crisis
Irwin, Douglas A. 363, 367–8, 372, 375–7
Japan.
See under public finance, sovereign debt crisis
Jasay, Anthony de 193
Jefferson, Thomas 194, 336
Jevons, William Stanley 78, 287
and marginalist revolution 45
Johns Hopkins Univ. 19
Johnson, Lyndon B. 302, 391
Johnson, Simon 273
Joplin, Thomas 87
Kaldor, Nicholas 90, 250, 252
Kalt, Joseph 352
Kennedy, John F. 391
Keynes, John Maynard 3, 12, 21, 71, 72, 126, 162, 167, 247, 269, 270, 386, 387
biography 13–14
and Bretton Woods 13–14
contra F. A. Hayek 17–18, 77, 91
attack on Hayek and Prices and Production 91
on policy response to Great Depression 131
rejection of argument in The Road to Serfdom 171
death 278
on economic policy and the role of government 16–18
economic theory of 14
See under Keynesian economics
on economists and laissez-faire 21
on economists focusing on practical problems 126
on first age of globalization 26
General Theory of Employment, Interest, and Money, The 3, 7, 14, 17
on gold standard.
See under gold standard, J. M. Keynes on
on Great Depression 14
on the influence of ideas and intellectuals 5
influence on policy.
See also Keynesian economics, widespread acceptance and influence of, on economic policy127
laissez-faire 16
on monetary policy before 1929 82
prediction of General Theory’s success of 126
on Russian Communism 17
on self-defeating output restriction policies 107
on Soviet Russia 162
use of label ‘classical economics’ 71
Keynes, John Neville 13
Keynesian economics 4, 14, 17, 18, 137, 244, 252, 303, 404
as depression theory 149
circular flow 133
contra Monetarism 321–24
contrast to F. A. Hayek’s macroeconomics 137–39
critique of Say’s Law 147–48
fiscal policy 131, 387–91
formalization of 151–52
General Theory of Employment, Interest, and Money, The 126
income-expenditure model 133, 395, 405, 406
inflation 308, 322
IS-LM model 151–52, 395
Keynesian-type policy before the formal development of 6
liquidity-preference interest theory 136–37, 147
M. Friedman’s critique of 313–14
monetary policy 130
multiplier effect 404–07
neoclassical synthesis 153
New Keynesian school.
See New Keynesian economics
paradox of thrift 135–36
Phillips Curve and inflation 152–53, 322
Post Keynesian school 153
propensity to consume 133
public finance 387–91
critiques of 392–407
revolution in economics 127
sticky wages 148
main points as summarized by P. Krugman’s 131
summary of depression theory of 148
view of savings widespread acceptance and influence of 7
explanations for 150–51
on economic policy 127, 391
Kirzner, Israel M. 62
Klein, Daniel B. 21, 341
Knight, Frank 203, 310
Koopmans, Tjalling 251, 252, 268
Krugman, Paul 8, 405
on advocates of protectionism 362
criticism of M. Friedman 312
on economists and laissez-faire 21
on fiscal policy 390
on J. M. Keynes and depression 131
on J. M. Keynes and orthodoxy 149
on pre-Keynesian economics 71
summary of The General Theory’s main points 131
support for punitive tariffs against Chinese imports 378
and theory of protectionism 378
Kydland, Finn 331
labor theory of value 30, 43–46
Labour Party (UK) 4, 163, 170, 173, 174, 177, 179, 180, 183, 184, 248
election victory of 174
Fabian influence on 186
post-WWII economic policy of 176–78
Laffer Curve 401–410
Laffer, Arthur, 402.
See under Supply-Side economics
laissez-faire 16, 18, 195
economists’ opposition to 18–25
origin of phrase 223
R. Tugwell on 111
Lange, Oskar 37, 46, 252, 257, 339
biography 48
on economic policy and the role of government 58–61
on Marxian economics 47–48
and socialist calculation debate 46–54, 58–61
Laski, Harold J. 174, 183–84
defense of Soviet terror 183
on economic policy and the role of government 183–84
Laughlin, J. Laurence 292
Leijonhufvud, Axel 152
Lenel, Hans Otto 245
Lenin, Vladimir 8, 28
and problems implementing communism 32–33
on Marxism 31
Taylorism’s influence on 118
Leonard, Thomas C. 19
Leontief, Wassily 257, 258
Lerner, Abba 339, 386, 387
Leslie, T. E. Cliffe 188
Levy, David 38, 65
liberalism
transformation of meaning 201
libertarianism 169, 201, 205
See classical liberalism, anarcho-capitalism
Lippmann, Walter 157, 164
List, Friedrich 373
on infant industry argument 375–76
Locke, John 194, 273, 318, 336
London School of Economics 15, 90, 151, 164, 174, 179, 203, 262, 270, 347
Loyd, Samuel Jones 88
Lucas, Robert E., Jr. 272, 329, 330
Lutz, Friedrich 237
Machlup, Fritz 72, 90, 203
on Austrian business cycle theory 80
Macmillan, Harold 161
macroeconomics
business cycle theory versus depression theory 149
J. M. Keynes as inventor of 132–33
New Classical school.
See New Classical economics
real business cycle theory 331
Mahalanobis, P. C. 246, 253
five-year plan for India 258
Malinvaud, Edmund 268, 269
Malthus, Thomas Robert 141
Mandeville, Bernard 220
influence on A. Smith 220–21
Mankiw, Gregory 154, 344
marginalist theory of value 12, 46
marginal productivity theory of factor prices 43
marginalist revolution 12, 45
criticism of theory of 341, 352
free-rider problem 342–43
market failure 250, 337
See also externalities
pollution 349–52
“tragedy of the commons” 348
versus government failure 338, 352
government regulation of 350, 351
market process
benefits from rivalrousl competition 53
entrepreneurial discovery 61–62
entrepreneurship in the 42
Marshall Plan 233
Marshall, Alfred 12, 14, 22, 51, 71, 188, 191, 195, 315, 343, 344, 376
on economic policy and the role of government 22, 23
on gold standard.
See gold standard
See under A. Marshall and I. Fisher on
on laissez-faire 22
Quantity Theory of Money 319–20
Marx, Karl 11, 28, 30, 207
biography 30
Communist Manifesto, The 30
economic theory of.
See Marxian economics
on private property 29
Marxian economics 30
exploitation theory of profit 30
labor theory of value 43–44
surplus value 30, 104
Marxism 11
historical prophecies 29, 30
influence in Europe post-WWI 34–35
theory of communism economy 28, 30, 33
McCulloch, John R. 88
Meade, James 177, 345
Means, Gardiner C. 108
Meltzer, Allan H. 152, 299, 304, 320
Menger, Carl 12, 14, 36, 78, 224, 225
biography 225–26
and marginalist revolution 45
and Methodenstreit with German Historical School 114
spontaneous order theory of.
See under spontaneous order, theory, of C. Menger
theory of emergence of money 226–29
theory of price formation of 226
Mercantilism. 363–65
A. Smith critique of 363–65
See under trade policy, protectionism
Miksch, Leonhard 236
Mill, James 20, 196, 284, 318
Mill, John Stuart 21, 22, 43, 44, 71, 143, 169, 191, 196–201, 376
defense of classical liberalism 196
on economic policy and the role of government 196–201
on infant industry argument 372
influence on Fabian socialism 201
Miller, Adolph 97
Miller, Preston 409
on public finance policy reform 412
Mirowski, Philip 206
Mises, Ludwig von 14, 15, 35, 39, 62, 85, 165, 203, 240, 242, 328
biography 35–36
business cycle theory of.
See under business cycles, Austrian theory of
critique of labor theory of value 43
on Currency School 87
Currency School’s influence on 87
definition of socialism 37
on economic policy and the role of government 36, 243, 244
on entrepreneurship 42
on free banking.
See under free banking, L. v. Mises on
on German Historical School 114
Human Action 36, 52
influence on F. A. Hayek 14, 35
K. Wicksell’s influence on 88
On monetary calculation.
See monetary calculation, socialist calculation debate, monetary calculation problem
private seminar 36
and socialist calculation debate 36–43, 46–53
and business cycles.
See under business cycles, L. v. Mises’ policy prescription for
Theory of Money and Credit 73
Mitchell, Wesley Clair 72, 105, 109, 309
Moley, Raymond 110
Molinari, Gustave di 25
Monetarisim 4, 154, 308–09, 311, 385
business cycle theory.
See under business cycles, Monetarist theory of
contra Keynesian economics 321–24
explanation of Great Depression 310–13
influence of R. Lucas and New Classicals on 330–31
interest theory 322
“Old Monetarists” 318, 323
policy proposals 323–28
constraints on Federal Reserve 326–28
monetary rule 325
rules over discretion 324
research program 320–21
monetary calculation 39–43
monetary policy
and gold standard 298–300
interest rate distortion from expansionary 82–85
in United States.
See Federal Reserve, gold standard, in United States
money.
commodity.
See bimetallism, gold standard
definition 226
emergence of 226–29
neutrality 315
Quantity Theory of.
See Quantity Theory of Money
See also Monetarisim
monopoly
and antitrust policy 243–44
regulation of 50, 51
Mont Pelerin Society 4, 15, 208, 229, 242, 244, 269, 270, 325
activity of 204
inaugural meetingof 203–04
influence on M. Friedman 310
intellectual influence of 206
origin of 203
purpose of 205, 207
Müller-Armack, Alfred 236
Muravchik, Joshua 28
Musgrave, Richard 342
Mussolini, Benito 99, 100, 155
Myrdal, Gunnar 252
on ‘underdevelopment trap’ 267
Nash, George H. 169
National Bureau of Economic Research 311
National Recovery Administration 101
See also New Deal
national socialism.
See fascism, Nazism
Nazi Germany 100
economic policy of 157–60
Nazism 100
Nazi Party 100
repression of dissidents and intellectuals under 155, 241, 242
Nehru, Jawaharlal 246, 247
on economic policy 247–50
neo-liberalism 201
network effect 228
Neurath, Otto 35
New Classical economics 154, 323, 330–31
New Deal 3, 99, 101, 201
Agricultural Adjustment Act 101
as basis for current US farm policy 108
economic problems of 107
economic problems of NRA and AAA 106–08
economists’ support for precursors of 24
and growth of government 22
influence of R. Tugwell on 102–03
Institutionalist economists’ support for 109
legal problems of NIRA and AAA 108
National Industrial Recovery Act 101
declared unconstitutional by Supreme Court 108
National Recovery Administration
influence of fascist economic policy model on 101
negative effect on recovery of 106–08, 128
precursors to 27
New Economic Policy of Lenin 34
New Institutional economics 244
New Keynesian economics 153–54, 323, 331, 406
New York Univ. 271
Newcomb, Simon 314
Nicholas II 28
NIRA.
See New Deal, National Industrial Recovery Act, National Recovery Administration
Nirvana fallacy 338
Nixon, Richard 302, 391
Nobel Prize 16, 310, 331, 358
Nordhaus, William 65
North, Douglass 272
Nozick, Robert 17, 336
NRA.
See under New Deal, National Recovery Administration
Obama, Barack 405
objective theory of value.
See labor theory of value
O’Driscoll, Gerald P., Jr. 399
Oppenheimer, Franz 234
Ordoliberalism 235–41
and antitrust policy 243–44
and constitutionalism 238
current status of 245
on economic policy and the role of government 235–41
and F.A. Hayek 237
and German Historical School 236, 240
and laissez-faire liberalism 239–41
and monetary systems 237–38
and rent-seeking 244
Orwell, George 171
Owen, Robert 23, 28
Panic of 1907 27
Pareto efficiency.
See welfare economics, normative criteria
Pareto, Vilfredo 5, 6, 192
biography 338–39
on the role of economic ideas 5
Parnell, Henry Stuart 89
Patten, Simon 109
biography 111–12
on economic policy 112
Peart, Sandra J. 65
Peel, Robert 88, 371
Phelps, Edmund 322
Physiocrats 222
Pigou, Arthur C. 22, 71, 72, 147, 172, 176, 191, 195, 199, 346, 347, 349
and externalities 51, 343, 344–45
on laissez-faire 23
objection to manner of J. M. Keynes’ criticism of F. A. Hayek 91
Plant, Arnold 347
Polanyi, Michael 204
Popper, Karl 204
Portugal.
See under public finance, sovereign debt crisis
Prescott, Edward C. 331
price system 15, 347
abolition of 33
economic calculation under socialism without.
See socialist calculation debate
See under monetary calculation
economic coordination 56–57
Price, Bonamy 281
private property 29, 273
abolition of 29
and economic development.
See development economics, and role of institutions
and externalities.
See externalities, and property rights
profit and loss calculation 37
See under monetary calculation
See also price system
progressive taxation 25
Progressivism 18–20, 27
and eugenics 24, 112
and Institutionalist economics 109
and paternalist interventionism 112
and prohibition 24, 112
and rule by experts 24
Technocracy 113
views regarding fascist economic policy 99
prohibition.
See under Progressivism, and prohibition
protectionism.
See under trade policy, protectionism, Mercantilism, Public Choice, rent-seeking
Prychitko, David 43
Public Choice 4, 244, 335
Calculus of Consent, The 357
concentrated benefits and dispersed costs 356
constitutional political economy 355, 357–59
as Coasean approach to politics 359
J. M. Buchanan and G. Tullock on 357–59
unanimity rule 358
influence of K. Wicksell on 358
overview of 355
rent-seeking 244, 355–57
theory of government failure 357
debate over 357
versus public goods theory 356
public finance
A. Smith on 389
budget deficits
and Keynesian economics 387–91
liability for 391–93
and classical economics 386
debate over 385–86
debt trap 382
fiscal policy 385, 395
P. Krugman on 390
issues in US 383–85
J. M. Buchanan and R. Wagner on 392–95, 399
and Keynesian economics 387–91, 392
monetary expansion as a source of government revenue.
See seigniorage
policy reform
debate over 412
T. Sargent, N. Wallace, and P. Miller on 412
Ricardian equivalence 395–401, 404
sovereign debt crisis 382–85
“unpleasant Monetarist arithmetic” 412
critiques of 392–407
public goods 217, 335
defining characteristics of 340
free-rider problem 342–43
income redistribution policies as 353–55
positive externalities of 343–44
private provision of 341, 346
and role of government 336–38
theory 335, 339–44
policy proposals of 342
types of goods 341
See under welfare economics
Quantity Theory of Money 308, 314–16
and A. Marshall 319–20
and I. Fisher 314
precursors to 318–19
Quesnay, François 222
Rae, John 317
Raico, Ralph 124
Ramesh, Jairam 252, 259
Rappard, William 208
Rawls, John 336
Read, Leonard 203
Reagan, Ronald 206
Real Bills Doctrine
definition of ‘real bills’ 95
differences between F. A. Hayek’s monetary policy norm and 97–98
explanation of 95–96
as guideline for monetary policy 95
major problems with 96–97
Reed, Harold L. 70
Reinhart, Carmen 385
rent-seeking.
See under Public Choice, rent-seeking
Ricardian equivalence.
See under public finance, Ricardian equivalence
Ricardo, David 43, 71, 142, 224, 284, 389
Richter, Rudolf 244
Roaring Twenties 68
and economic boom and bust in US 69–70
Federal Reserve policy during 69–70
Robbins, Lionel 15, 50, 72, 94, 192, 203, 204, 207, 339
on inflationary boom as cause of Depression 81
Robertson, Dennis H. 72
Robinson, James A. 273
Robinson, Joan 250, 252, 270, 360
Rockoff, Hugh 23
Rodrik, Dani 267
Roemer, John 66
Rogoff, Kenneth 385
Romer, Christina 405
Romer, Paul 272
Roosevelt, Franklin 27, 99, 107, 335
on inflationary boom as cause of Depression 81
and ‘Brain Trust’.
See under Brain Trust
Röpke, Wilhelm 155, 161, 204, 234, 236, 237
biography 242–43
on fascist economics 155, 161
Rothbard, Murray N. 17
rule by experts.
See under Progressivism, and rule by experts
Russia 28
Russian Revolution of 1917 28
Rüstow, Alexander 234
Rutgers Univ. 309
Sachs, Jeffrey 10, 271
Sally, Razeen 243
Samuelson, Paul 8, 127, 135, 153, 339, 342, 346, 397
evaluation of socialism 65
public goods theory 335, 339
See under public goods, theory
on ‘underdevelopment trap’ 267
Sargent, Thomas 405, 409
on Keynesian multiplier estimates 406
on public finance policy reform 412
Say, Jean-Baptiste 143, 386
influence on Supply-Side economics 401
See also Say’s Law of Markets
Say’s Law of Markets 144–45
J. M. Keynes’ critique of 147–48
scarcity 29
Schelling, Thomas C. 349
Schmidtz, David 338
Schmoller, Gustav 114, 236, 240
Schumpeter, Joseph 57, 172
on German Historical School 114
Schwartz, Anna J. 128, 299, 310
seigniorage 407–09
Selgin, George 27
Seligman, Edwin R. A. 109
on ‘scientific’ methodology of German Historical School 114
Sen, Amartya 250
Senior, Nassau 279, 283–87
Shaw, George Bernard 2, 126, 179, 182, 186, 188, 190, 247
and Fabian Society 183
Shenoy, B. R. 246, 254, 258
biography 262–63
Shenoy, Sudha 263
Sidgwick, Henry 20, 21, 22, 191, 343, 372
development of infant industry argument 377
Simons, Henry 310
Singh, Manmohan 262
Sismondi, Jean-Charles-Léonard Simon de de 141
Skidelsky, Robert
criticism of F. A. Hayek’s policy prescriptions 93
Smith, Adam 1, 9, 11, 16, 43, 45, 71, 120, 191, 194, 198, 209, 221, 226, 227, 238, 247, 250, 272, 273, 274, 284, 336, 347, 360, 377
argument for free trade 365–67
biography 209
and classical liberalism 208–09, 230
critique of colonialism 364–65
critique of infant industry argument 373
critique of Mercantilism 363–65
on economic policy and the role of government 216–19, 336
free banking 210, 217–18
on gold standard.
See under gold standard, and classical economics
influence of B. Mandeville on 220–21
influence of D. Hume on 222
influence of F. Hutcheson on 220
as intellectual touchstone and icon 209–10
on public finance 389
on public goods 337
on seigniorage 407
on self-interest 211
spontaneous order theory of.
See under spontaneous order, theory, of A. Smith
on system of natural liberty’ 215
Wealth of Nations, The 210–11
Smithies, Arthur
on F. A. Hayek’s Pure Theory of Capital 93
social cost.
See under externalities
Social Gospel 117
socialism
arguments for 50–52
collapse of Soviet 63–67
and current lack of a model of 66
definition 10
market 46–48, 49–50
as transition between capitalism and communism 33
utopian 28, 117
K. Marx and F. Engels’ criticism of 28–29
socialist calculation debate 3, 36–66, 165, 224
centralization vs. decentralization 55–57
contribution of F. A. Hayek to 53–61
contribution of L. V. Mises to 36–43, 46–53
contribution of O. Lange to 46–54, 58–61
economists’ views of 63–66
entrepreneurial problem 52–53
incentive problem 38–39, 46
knowledge problem 53–58
F. A. Hayek on nature of 54–55
monetary calculation problem 39–43
Solow, Robert 153
Sombart, Werner 160–61, 236, 240
sovereign debt crisis.
See under public finance, sovereign debt crisis
Soviet Union 32
and collapse of socialism 63–67
economic problems of 33–34, 38–39
J. Stalin’s terror of 182
shortages and famine in 34, 38–39
transition to socialism 32–34
Sowell, Thomas 8, 62, 219
Spain.
See under public finance, sovereign debt crisis
special interests.
See under Public Choice
specialization.
See under division of labor
Spencer, Herbert 25, 197
spontaneous order 9, 15, 214–16
theory
emergence of money 226–29
of A. Ferguson 222
of A. Smith 214–16, 224
of C. Menger 224
of F. A. Hayek 215
policy implications of 229–30
Sraffa, Piero 90
Stalin, Josef 182
Stanislaw, Joseph 13
state capitalism 9, 10, 17, 100, 117
state socialism
Bismarck’s economic policy as 117
Stigler, George 2, 6, 190, 203, 204, 332, 333
Stiglitz, Joseph 267
stock market crash, 1929 68
Stringham, Edward P. 17
subjective theory of value 12, 46
subjective-marginal utility theory 45
Supply-Side economics 401–04
Laffer Curve 401–02
policy influence of 402–03
Supreme Economic Council 33
surplus value.
See under Marxian economics:surplus value
Switzerland 202
tariffs.
See under trade policy, protectionism
Tavlas, George S. 382
Taylor, Fred M. 22
Taylor, Frederick Winslow 118
Taylorism 118–20
See under Progressivism, Technocracy, rule by experts
See also Tugwell, Rexford G., and Taylorism
Tea Party 358, 385
Technocracy.
See under Progressivism, Technocracy, rule by experts
technological progress
under capitalism and socialism 52
Temin, Peter 298
Thatcher, Margaret 206, 321
Thomas, Robert 272
Thornton, Henry 96, 280
Thurow, Lester 353–55
Timberlake, Richard H. 299
Tinbergen, Jan 251, 252
Tobin, James 387, 391, 396
Tocqueville, Alexis de 165
Tooke, Thomas 89
Torrens, Robert 88, 368
Toye, Richard 180
trade policy
economists on 361
F. Bastiat on free trade versus protectionism and “Candlemakers’ Petition” 368–69
floating exchange rate 380
free trade
A. Hamilton opposition to 374
A. Smith on 365–67
M. Friedman on 360
theory of comparative advantage and case for 366–68
unilateral 360
liberalization, post-WWII 361
P. Krugman on free trade versus protectionism 378
protectionism 362, 365–66
advocates of 362–63
P. Krugman on 362
Corn Law.
See Corn Law, Great Britain
“infant industry” argument for 372–73
A. Hamilton on 375
A. Smith critique of 373
F. List on 375–76
H. Chang on 373
H. Sidgwick development of 377
J. S. Mill on 373
J. Bhagwati on 363
as tool for trade liberalization 378–79
vested interests in 365–66
trade deficit 379–81
Trotsky, Leon 33
Tugwell, Rexford G. 3, 99
biography 110–11
influence over New Deal policies 102–03, 110
interest in fascism as economic policy model 99
J. A. Hobson’s influence on 104
on cause of Great Depression 103–04
and Taylorism 118–24
and Taylorism 119
on economic policy and the role of government 102–03, 118–24
on invisible hand and laissez-faire 111
on profit motive 123
on theory of underconsumption 103
policy prescription for Great Depression 102–03, 104
position in Roosevelt administration 110
S. Patten’s influence on 111
unawareness of socialist calculation problem and debate 122
Tullock, Gordon 335, 356, 357–59
Turgot, Anne Robert Jacques 223
underconsumption theory
D. Ricardo’s critique of T. Malthus on 142–43
J. A. Hobson on 105
Say’s Law of Markets 144–45
T. Malthus and J. Sismondi on 141–42
unemployment, natural rate of 326
United States
growth of government 334–35
national debt and public finance issues in 383–85
Utilitarianism 20, 192, 193, 194, 196, 198, 201
and economics 20, 21, 192, 194–96, 339
influence on Fabian socialism 195
J. Bentham’s contribution to 191–93
concept of ‘utility’ in 192
and Pareto efficiency 339
Van Zandt, David E. 346
Vanberg, Viktor 238
Veblen, Thorstein 52, 109
biography 112–13
‘conspicuous consumption’ 112
ideology of 117
influence on J. A. Hobson 104
on neoclassical economics 112
Veseth, Michael 11
Vienna, Univ. of 12, 14, 35, 225, 226
Viner, Jacob 72, 310
Volcker, Paul 309
Voltaire 212
Wagner, Richard E. 7
critique of Keynesian economics.
See under public finance, J. M. Buchanan and R. Wagner on
Walker, Francis A. 289
Wallace, Neil 409
on public finance policy reform 412
Walras, Léon 338
and marginalist revolution 45
Webb, Sidney and Beatrice 162, 179–82
on economic policy and the role of government 180–81
influence in Labour Party 180–81
support of Soviet Russia 182
Weber, Max 160
welfare economics 339
and A. Pigou 344
normative criteria
Kaldor-Hicks efficiency 352
Pareto efficiency 337, 339
limits of 352
policy proposals of 342, 344, 345
See also externalities
See under government failure, market failure
White, Harry Dexter 275, 277
White, Lawrence H. 27
Wicksell, Knut 14, 15, 71, 73, 77, 85, 87, 133, 135, 317, 328
influence on F. A. Hayek and J. M. Keynes 15
influence on J. M. Buchanan and Public Choice 357
influence on L. v. Mises 88
Wieser, Friedrich von 14, 36
Wilson, Woodrow 27
interventionist economic policies during WWI 100
Winch, Donald 206
Wittman, Donald 357
Wootton, Barbara 170
World Trade Organization 360, 361
World War, First 3, 12, 14, 35, 241
and growth of government 22, 27, 100
international economic system prior to 275
interventionist economic policies during 100
as precursor to New Deal 100
Treaty of Versailles 13
World War, Second 4, 15, 92, 161, 202, 231
and growth of government 163, 334
interventionism during 163–64
Yale Univ. 24, 316
Yeager, Leland 296, 318
Yergin, Daniel 13
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