February 2014

A Video Introduction to Austrian Economics

by Andy Duncan on 28/02/2014

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For those coming to to Austrian Economics for the first time, it can seem a daunting process.

There are hundreds of books to choose from and many different strands of the tradition, mainly emanating from Menger, via Wieser through to Hayek and Kirzner, or via Böhm-Bawerk through to Mises and Rothbard, with much cross-fertilisation along the way. Fortunately, there is an easy beginning, which is the book Economics in One Lesson (available online in either HTML or PDF format), by Henry Hazlitt, who for many years attended the Mises Seminar, in New York.

If even this is too much for the uninitiated, there is an excellent series of 11 lectures delivered by arguably the two most important current representatives of the Misesian line of Austrian Economics; Jörg Guido Hülsmann and Hans-Hermann Hoppe.

The lectures covered are:

  • Mises and the Austrian School (Hülsmann)
  • Value, Utility and Price (Hülsmann)
  • Division Of Labor and Money (Hoppe)
  • The Theory of Banking (Hoppe)
  • Capital and Interest (Hoppe)
  • Praxeology: The Austrian Method (Hoppe)
  • Business Cycle Theory (Hülsmann)
  • The Economics of Deflation (Hülsmann)
  • Theory and History (Hoppe)
  • Welfare Economics (Hülsmann)
  • Law and Economics (Hoppe)

You can access these lectures directly via YouTube. Or for ease of use, you can click through each lecture, one after the other, on the Lew Rockwell site.

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Gene Callahan: Economics for Real People

by Andy Duncan on 27/02/2014

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While Economics in One Lesson is almost the definitive starting point for those new to the Austrian School, after you have finished reading it there still remain many mysterious doors in front of you in a maze of subjective choice, all of them tempting you towards the next port of call in your quest to shake off the nostrums of Keynesian economics.

There are perhaps two major pathways to explore in this maze. The first is to acquire an Austrian-style understanding of what is currently happening in the financial markets and the global economy. To do this, we must first understand how the international central banking system works, which is based upon fractional reserves; So what is fractional reserve banking? When did it start? Why did it start? Who started it? How does it work? And where will it take us?

As Churchill said of the old Soviet Union, fractional reserve banking is a riddle wrapped in a mystery inside an enigma. Therefore, to see inside it we need to be guided into this enigmatic riddle by a man wearing X-Ray glasses. This bespectacled man is Murray Rothbard, and the book in which he makes it all sharply clear as day is The Mystery of Banking (which is freely available as a beautifully produced Scribd book).

But before we head off gleefully down this pathway, you might want to consider tackling the second major pathway instead, which is the road to understanding what has been happening in the financial markets and the global economy for the past several hundred years (or even for the past few thousand years, since financial markets were first created in Sumeria, Egypt, Meso-America, and China, and possibly before even that in the Stone Age).

The first major milepost on this second road is the book Human Action, by Ludwig von Mises, perhaps the outstanding publication of the entire Austrian School, since 1870 onwards.

However, Human Action is a forbidding book which can easily scare off the faint of heart. To warm yourself up for it, you might consider a much lighter book instead, which is Economics for Real People (PDF), by Gene Callahan, who has broken his book down into four major parts, all of which make Human Action much easier to access afterwards:

  • The Science of Human Action
  • The Market Process
  • Interference with the Market
  • Social Justice, Rightly Understood

Mr Callahan’s book is a sort of half-way house between Economics in One Lesson and Human Action, and at just over 300 pages is meaty enough to give you something to get your teeth into, but short enough to give you time to breathe in and out while you’re reading it.

In the meantime, before deciding which one of the two parallel pathways to go down first, while completing Economics in One Lesson, you might want to watch a series of videos put together by The Mises Institute, each of them covering a single chapter of Hazlitt’s classic introduction to the Austrian School:

  • Video 1: The Lesson
  • Video 2: The Broken Window
  • Video 3: Public Works Mean Taxes
  • Video 4: Credit Diverts Production
  • Video 5: The Curse of Machinery
  • Video 6: Disbanding Troops and Bureaucrats
  • Video 7: Who’s Protected by Tariffs?
  • Video 8: “Parity” Prices
  • Video 9: How the Price System Works
  • Video 10: Minimum Wage Laws
  • Video 11: The Function of Profits
  • Video 12: The Assault on Saving

These videos are all available via a misesmedia playlist.

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German Movie Review: Beloved Berlin Wall

February 26, 2014

I watched a great movie on Singapore Airways. ‘Beloved Berlin Wall’ describes a love story between a West Berlin lady student and an East German border guard, just before the fall of the Berlin Wall in 1989. Yes, it’s in shot in the German language, but it’s still a great little comedy and well worth […]

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Early Speculative Bubbles and Increases in the Supply of Money

February 25, 2014

You know you have crossed into the Austrian light when you wake up one morning and everything has become clear. From that point forward, for the rest of your life, you realise that almost every societal problem you encounter, no matter how simple nor how complex, is usually something to do with involuntary coercion, threatened […]

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Tom Woods: Meltdown

February 24, 2014

Having already read What Has The Government Done To Our Money?, The Mystery of Banking, and Early Speculative Bubbles and Increases in the Supply of Money, the aspiring student of Austrian Economics will have a clear idea as to why the finances of the western world are in such a calamitous state. However, we now […]

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Hans-Hermann Hoppe: A Unified Theory of Everything

February 23, 2014

I possess three brain cells. One is concerned with food and beer, particularly Sam Adams light, the black stuff from Guinness, and any full strength export lager originating from Sweden. The second brain cell is concerned with personal visions of a possible future in a couple of thousand years. The third brain cell, God bless […]

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Murray Rothbard: The Mystery of Banking

February 23, 2014

If What Has The Government Done To Our Money? is an hors d’oeuvre, then The Mystery of Banking is the main appetiser in our quest to understand how the current financial global crisis arose. Far meatier than its predecessor, The Mystery of Banking paints the Mona Lisa’s face, where the earlier book simply sketches out […]

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And Then There Were Three: How an Economy Grows and Why It Crashes

February 22, 2014

Stop all the clocks, cut off the telephone, and prevent the dog from barking with a juicy bone. Because there used to be just one standard economics primer that the aspiring Austrian student could get started with: Economics in One Lesson However, this may have been joined by a second junior partner: How an Economy […]

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Henry Hazlitt: Economics in One Lesson

February 20, 2014

In the classic novel King Solomon’s Mines, the witch Gagool leads a group of Englishmen, including the legendary Allan Quatermain, into an ancient treasure room deep inside a mountain carved within solid rock and chock full of gold, diamonds, and other splendid jewels. To feel like Quatermain yourself, to discover an almost endless stream of […]

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Hans-Hermann Hoppe: Walking on the wild side

February 17, 2014

Hitchhikers’ Guide to the Galaxy fans will remember the ultimate cocktail drink; the Pan Galactic Gargle Blaster. Imbibing this infectious blend was like being hit in the head by a slice of lemon wrapped around a large gold brick. But does the Pan Galactic Gargle Blaster remain the ultimate cocktail? I think I may have […]

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