I mention this only to show that I am hardly a trained economist, or graduate student in the subject, but consider myself an interested student in the Austrian school.
It seems that Austrians criticise other approaches to economics as not really applying to the real world, and therefore should be dismissed (except in the historical context, of course.). We are not accustomed to criticizing the free market
However, it seems that in the real world, free markets never last for long, and in fact, the history of the world can be summed up as prosperity being destroyed by government which seems to continue to grow until the parasite kills the host. There seems to be a real market for plunder, in spite of the fact that it is ruinous. The same mistakes are made over and over again, in spite of the recurrent abundant evidence that the same disastrous results occur.
Any study of HUMAN ACTION has to explain this in my view. Does anyone know of scholarly work that addresses this subject?
In answer to your question, I do not. However, addressing your post, I myself think governments are the one market failure. However, until now, I do not think there has been a very good critique of governments. Hopefully, with all the material, people’s faith in government can be broken.
Would you not agree that governments are just corporations? Would you not also agree that if people really did not want government, they could easily get rid of it? I conjecture, that at most, only 3% of the population would need to stop obeying government dictates to bring it down. But ask most people that have a gripe with the government if they would be willing to stop obeying the government until it gave into their wishes, and my guess is that 99.99% of them would say no, even if 3% of the population would go along with him or her. But as most of us on here know, governments are the root cause of all the wrongs in the world. Why would people choose to have a government?
Hoppe gives a great lecture on why classical liberal democracies must eventually become much more aggressive and turn into dictatorships/socialist paradises.
Because the free market of classical liberals is so successful in enriching a nation, the rulers have much more potential money (taxes) to spend. This vast wealth sets them at a comparative advantage to those nations who have adopted more socialist (unproductive) means of organization. There is a huge incentive for the leaders of the more capitalist countries, to wage war on the less capitalist countries, because they know they can win. Of course, the forces of warfare and expanding empire lead to borrowing/printing money and spiraling debt, which in turn, leads to socialist policies.
This perfectly explains the relative rise and fall of America, and many other countries as well.
The Anti-Capitalistic Mentality by Ludwig von Mises, I think does a good job of explaining part of the problem, at least from the point of view of Mises.
Yes. I do not believe there would be governments in a free society. I believe there would be people that would provide arbitration services, security services, etc., etc. But no governments or PDAs.
There are many ways to compete in the market place..
Most of the ways that Austrians consider legitimate, include innovation, marketing, pricing, and other methods which require business acumen, and, let’s face it, damn hard work. How much easier it would be to have an agent of force who would make laws preventing others from entering the marketplace and biting off a piece of market share. Why compete for your job with others who might undercut you when you can have a trade union to block them? Why compete on a world wide basis when you can influence the state to protect your industry from foreign competition? Why knock yourself out improving a product when the state can grant you monopoly powers through patent laws?
The fact that these actions lead to malaise, mediocrity, and laziness means little to the individual businessman or laborer…
Free markets can be difficult and hazardous, and soliciting Government “help” can raise the comfort level of the entrepreneur.
This is what I mean when I talk about a market for plunder; it’s clear that it can be very seductive, even if eventually it destroys the very markets that provide the total wealth of society.. Certainly the market for plunder ALWAYS trumps the free market in the long run… and it seems clear that when plunder becomes entrenchedd it becomes politically impossible to stop it.
Thank you all for your input… I’m interested in your further thoughts.
Disagree. From a socio-biology standpoint, we tend towards collectivism more so than individualism. What enables individualism, is advancement. Law, language, science etc.
So only capitalist countries wage wars? And only on non capitalist countries?
And America’s economy was capitalist before every war and became more socialist after every war? And many other economy’s as well?
And all the empires were just shooting themselves in the foot ripping off their conquered countries? And they all had to print money and borrow to lug all their treasures home?
In which alternate universe did any of this this happen?
Sociobiology is teleological bunk. If anything, society is far more “collectivist” post law, language and science than it was in ancient times. Unless you deem “collectivist” the high probability of dying of murder or attribute the change to communism.