Herbert Davenport: The Economics of Enterprise

by Richard M. Ebeling* This year marks the hundredth anniversary of the publication of Herbert J. Davenport’s (1861-1931), The Economics of Enterprise, which appeared in the early months of 1913. Both mainstream economists as well as many “Austrians” seem to have long since forgotten Herbert Davenport. But during his time he was recognized as one … Continue reading Herbert Davenport: The Economics of Enterprise

The Limits of Bayesian Inference

by Gene Callahan Dan Klein's Knowledge and Coordination has something interesting to say about Bayesian inference, although he never explicitly addresses that topic. Consider the following: Here, we have the distinction between responding to the realization of events within a framework of recognized variables and relationships and the discovery of a fresh opportunity to embrace a new … Continue reading The Limits of Bayesian Inference

The Infrastructure Death Rattle

by Mario Rizzo The incessant discussion and demand for job-creating infrastructure spending on the part of the news media, Democratic politicians, and some unreconstructed Keynesian economists is both frustrating and pathetic. It is frustrating because how many times can people repeat the same thing without listening to the objections? It is pathetic because the level … Continue reading The Infrastructure Death Rattle

Kirznerian Baseball

by Gene Callahan The Mets recently hired Paul DePodesta, one of the key developer's of the "Moneyball" approach to finding and hiring baseball talent in Oakland. DePodesta describes what Moneyball really is here: DePodesta, who left Oakland to serve as the Los Angeles Dodgers’ general manager for two seasons before becoming an executive with the … Continue reading Kirznerian Baseball

Executive Compensation as Lottery Prize

by Chidem Kurdas Last week the WSJ published a list of the past decade’s best-paid chief executives. You might nod approvingly at some names but gag at others. In the former group is Steve Jobs of Apple, whose company’s share value grew by about 11-fold in the period from 2000 to 2009. In the latter … Continue reading Executive Compensation as Lottery Prize

Understanding Markets: Point/Counter-Point

by Thomas McQuade and Chidem Kurdas Though it should be obvious to all that markets are of immense benefit to humanity, any appreciation of these institutions is almost always hedged with a perceived need to constrain and regulate—in short, to subject them to conscious outside control.  The reasoning is understandable: the unconstrained pursuit of self-interest … Continue reading Understanding Markets: Point/Counter-Point

Cafeteria Marvels

 by Mario Rizzo   The market is a “marvel.” What does that mean? According to Marcus Tullius Cicero, the Roman orator and senator, a marvel is something contrary to or surpassing common understanding.   In that sense, the market is a true marvel – so much so that it even surpasses the understanding of many economists.   Richard … Continue reading Cafeteria Marvels

Bring Back the Robber Barons

by Jerry O’Driscoll  That is the title of yesterday’s “Wonderland” column by Daniel Henninger in the Wall Street Journal.    Henninger distinguishes between market entrepreneurs and political entrepreneurs.  Market entrepreneurs innovate and create new products.  Political entrepreneurs make money by gaming the political system. “We need vision, vitality and commercial moxie. The government is draining it … Continue reading Bring Back the Robber Barons

Rising in Phoenix: Entrepreneurial responses to housing and health-care problems

by Sandy Ikeda The New York Times, in "Amid Housing Bust, Phoenix Begins a New Frenzy", reports that "Real estate got just about everyone into trouble in Phoenix, and the thinking seems to be that real estate is going to get everyone out." If the property looks promising, Mr. Jarvis puts in a bid on … Continue reading Rising in Phoenix: Entrepreneurial responses to housing and health-care problems

Kirznerian Alertness and Neuroscience

by Roger Koppl Jake Young of Pure Pedantry has a nice post using the neuroscience of preconscious processing to address the issue of Kirznerian alertness.  He was responding to Sandy’s post, "Stumbling on Profit Opportunities.”  Jake gives a negative reply to Sandy’s conjecture that preconscious processing, whereby we leap away from a snake before processing … Continue reading Kirznerian Alertness and Neuroscience

Henry James on Shackle versus Kirzner

by Sandy Ikeda “There are two kinds of taste, the taste for emotions of surprise and the taste for emotions of recognition.” This is from The Practical Cogitator (p. 463), handy sourcebook for intellectual dilettantes (like me). According to Wikiquote, the original source is James’s essay, “Anthony Trollope," Century Magazine (July 1883).  I'll take their … Continue reading Henry James on Shackle versus Kirzner

Stumbling on profit opportunities

by Sandy Ikeda I've been thinking about the following from Daniel Gilbert’s Stumbling on Happiness: Experiments have demonstrated that the moment we encounter an object, our brains instantly analyze just a few of its key features and then use the presence or absence of these features to make one very fast and very simple decision:  … Continue reading Stumbling on profit opportunities