Towards Reasonableness in Cycle Theory, II

By -
Haberler said much the same thing as I was pointing at yesterday, of course having arrived at this opinion decades before I did:
It is true, a horizontal maladjustment alone (that is to say, an over-delopment of a particular branch of industry) can explain only a partial -- as opposed to a general -- depression for the reason that, if industry A is over-developed, there must be an industry B which is under-developed and, if A is depressed, B must prosper. But the same is true, as we have seen, of a vertical maldistribution of the factors of production.

In order to explain a general depression, it is necessary to recognize that a deflationary cumulative process can be set in motion by partial dislocation of the productive process. If this is accepted, there is no difficulty in assuming that such a vicious spiral of contraction may be started by a horizontal, as well as by a vertical, maladjustment in the structure of production. -- Prosperity and Depression, p. 111

Comments

Post a Comment

Popular posts from this blog

In ancapistan, if you have no property, you have no rights

By -
Ancaps often declare, "All rights are property rights." I was thinking about this the other day, in the context of running into libertarians online who insisted that libertarianism supports "the freedom of movement," and realized that this principle actually entails that people without property have no rights at all, let alone any right to "freedom of movement." Of course, immediately, any ancap readers still left here are going to say, "Wait a second! Everyone owns his own body! And so everyone at least has the right to not have his body interfered with." Well, that is true... except that in ancapistan, one has no right to any place to put that body, except if one owns property, or has the permission of at least one property owner to place that body on her land. So, if one is landless and penniless, one had sure better hope that there are kindly disposed property owners aligned in a corridor from wherever one happens to be to wherever the...
Read more

If Fractional Reserve Banking Is Fraudulent, Then So Is...

By -
In this paper , Hoppe, Hülsmann, and Block (HHB) make their ethical case against fractional reserve banking (FRB) based on the fact that "two individual owners cannot be the exclusive owner of one and the same thing at the same time." They then posit that since fractional reserve bank notes creates multiple titles or claims to the "same" gold, they are inherently fraudulent. In analyzing this claim, the first thing we will have to do is to turn it into a remotely sensible claim. No one who deposits money at a bank thinks they are entitled to the same money back. What they want, when they go to get their money out, is the same amount of money back. What a gold-backed  fractional reserve note comprises is a claim to a certain amount of gold, not certain particular pieces of gold. I hope that change to their argument is uncontroversial! So their complaint comes down to this: if a bank issues pieces of paper that allow the bearer to claim a certain amount of gold...
Read more

St. Paul and I Agree...

By -
Taxation is not theft: "Let every soul be subject to the governing authorities. For there is no authority except from God, and the authorities that exist are appointed by God. Therefore whoever resists the authority resists the ordinance of God, and those who resist will bring judgment on themselves." -- Romans 13 The key idea implicit here, and the one that turned me on the subject of whether or not taxation is theft, is that "every soul" owes obedience to the "governing authorities." Now, if that is a debt I truly owe , then, when those authorities levy the taxes they need to do the job of governing, I owe them those taxes, and attempts to collect them certainly do not constitute acts of theft. And obviously it doesn't matter at all, from this point of view, whether or not I "signed" any sort of "social contract." (In fact, the history of political thought since the Reformation can be read as an attempt to find a secular rep...
Read more