Communism Does Not Help Aboriginals

The CIS has just released a radical essay on “Private Housing in Aboriginals Lands“. If only they were also in favour of property rights when it comes to funding such minor areas as education, defence and healthcare.

Kasper Says They’re All Wrong

Professor Wolfgang Kasper’s latest paper, “What’s Wrong with Neoclassical Orthodoxy?” is available in PDF here. I am told this attracted much controversy at conferences in Germany and New Zealand, where it was presented. Two excerpts:

most neoclassical textbooks fail to discuss the critical role of profits and losses in governing economic life and, instead, relegate entrepreneurs to the fringe of the discipline, if they are mentioned at all.

And:

Dozens of introductory economic textbooks convey the impression that the political and administrative elites are tireless, selfess agents who do the people’s will, serving the general good of society, the much-cited ‘national interest’. In other words, neoclassical authors assume there are no principal–agent problems and no cases of agent opportunism. This is patently untrue. Public choice theory, inspired by neo-Austrian economics, has shown that political and bureaucratic decision makers are not white knights in shining armour. They are self-seeking knaves like most of us. This sceptical, but realistic, view of political and bureaucratic behaviour is still often dismissed as cynical and misanthropic, and it cannot be ftted easily into the neoclassical paradigm. It is certainly not taught in high schools and academies. Nonetheless, an understanding that our elected and appointed agents are self-seeking has gained wide popular acceptance in the mature democracies. More and more people therefore reject the neoclassical assumption of an all-knowing, well-intentioned government.

The Importance of Imagination

Kenneth D. Goldin’s classic essay “Equal Access vs. Selective Access:  A Critique of Public Goods Theory” is available in PDF here. The highlight of the piece is this crucial passage:

Lighthouses are a favorite textbook example of public goods, because most economists cannot imagine a method of exclusion. (All this proves is that economists are less imaginative than lighthousekeepers.) Since lighthouse users are also harbor users, use of harbors can be made dependent on payment of lighthouse fees. The British lights were financed in this way for many years. [p. 62]

So whenever you come across anyone claiming the inability of the market to provide something, accuse them of lack of imagination, along with the usual lack of respect for economic reasoning, which they pretend to espouse.