Semi-Daily Journal

So why waste bandwidth even pointing it out?

"If one asks what substantive contributions [Hayek] made to our understanding of how the world works, one is left at something of a loss. Were it not for his politics, he would be virtually forgotten."

-- Paul Krugman in Slate, 12/4/98

"In my view this particular essay combines brilliance and antibrilliance in remarkable degrees..."

Do tell. Seriously...what parts are "brilliant" and what parts are "antibrilliant"?

The first half seems to me to be very, very nice.

The second half wanders off into Hayekian hobbyhorses that I don't think are very helpful.

Hmmm..., it seemed to me to have more brilliance than anti-brilliance most of the way through, although I agree that the "five-sixths" proposal ran off the rails.

Thanks for pointing this out to me. A key reason I never got past Econ 101 was that every elementary treatment of economics started with assumptions of equilibrium, perfect knowledge, etc. It seemed that even more advanced classes still treated this as the normal case and added some perturbations. This always seemed bass-ackwards to me.

Since I've gotten out into the business world, it has struck me more clearly that the basic case should be essentially the opposite of what is usually presented. A businessperson does something because he thinks it can upset whatever "equilibrium" is out there, but he starts out from the condition of no market knowledge -- that no one knows what he is trying to do -- and he must get the knowledge out somehow to do anything. Judging from the number of accidental successes in business, most businesspeople don't really have a very good sense of what people really want, either.

I don't have a clue as to whether it would be plausible to "turn around" the presentation of introductory economics as I suggest (I don't even know how it's being taught in general today), but I'd love to see it given a stab.

Re my earlier post, perhaps I should reconsider. I just came upon this in a quite interesting interview with Keynes' biographer, Skidelsky, at
http://www.pbs.org/wgbh/commandingheights/shared/minitextlo/int_robertskidelsky.html
~~~

LORD ROBERT SKIDELSKY: Keynes and Hayek were good friends in private life .... [though] in their economic theories they clashed pretty violently.... Yet looking back at it, after this distance, it seems to me that they were, roughly speaking, on the same side...

Keynes was much more entrepreneurial in his economics. He was an economics entrepreneur really... he was an enormous seducer... a tremendous intellectual charmer. Hayek was rather reserved. He was a very German academic in that kind of way. But having said all that, people do live on their books, and the intellectual charm fades away, and it's what's solid that remains.

A lot of Hayek's work will, of course, survive because it is very, very solid, and he did have a profound understanding of the nature of knowledge in the economy, a profound understanding that it couldn't be centralized in some central planning organization, and I find that I refer to Hayek more and more in my own thinking. When I look at the catastrophes of state education systems, for example, it's all the nemesis of Hayekian planning.

And so Hayek will live. He's the other great economist... Well, he's the second great economist of the 20th century. Milton Friedman, of course, is the third.

INTERVIEWER: And the first is Keynes?

LORD ROBERT SKIDELSKY: I would say so, yes. Well, I think the three great economists of this century were Keynes, Hayek, and Friedman. I'm not sure exactly how I'd rank them, except I think I would have to say Keynes and Hayek were the top ones in their profundity....
~~~

Perhaps I was misled, and Hayek is worth some bandwidth after all.

Yes Jim, you were obviously misled if you're relying on a silly quote from Krugman for your opinion.