Recent Posts
(Note: Page numbers referenced in posts prior to June 1, 2011 refer to 5th edition)
Solow on Hayek and Friedman
Robert Solow reviews Angus Burgin's book The Great Persuasion: Reinventing Free Markets since the Depression. In so doing, he reminds us that the politicized Hayek is a caricature of the real Hayek.
Textbook References:
Page 342 “Galbraith versus Hayek”September 14
Hayek and Keynes
An Excerpt from Silvia Nasar's book The Grand Pursuit: The Story of Economic Genius discusses Keynes and Hayek.
Textbook References:
Pages 10-11 “Principle 6: Markets Are Usually A Good Way To Organize Economic Activity”Pages 11-13 “Principle 7: Governments Can Sometimes Improve Market Outcomes”
Page 342 “Galbraith versus Hayek”
Page 751 “The Origin of the Model of Aggregate Demand and Aggregate Supply”
Pages 773-779 “Using Policy To Stabilize The Economy”
December 16
The Economics of Seinfeld
Clips from the TV show "Seinfeld" are used to illustrate a variety of economic concepts.
Textbook References:
Pages 4-5 “Principle 1: People Face Trade-offs”Pages 5-6 “Principle 2: The Cost of Something is What You Give Up to Get It”
Page 6 “Principle 3: Rational People Think at the Margin”
Pages 7-8 “Principle 4: People Respond to Incentives”
Pages 10-12 “Principle 7: Governments Can Sometimes Improve Market Outcomes”
Chapter 3 “Interdependence and the Gains from Trade”
Pages 67-72 “Demand”
Pages 73-76 “Supply”
Pages 144-153 “Controls on Prices”
Chapter 10 “Externalities”
Pages 226-227 “The Different Kinds of Goods”
Pages 227-232 “Public Goods”
Pages 230-232 “The Difficult Job of Cost-Benefit Analysis”
Pages 232-237 “Common Resources”
Pages 274-275 “Fixed and Variable Costs”
Page 281 “Economies and Diseconomies of Scale”
Pages 312-315 “Why Monopolies Arise”
Chapter 16 “Monopolistic Competition”
Pages 370-378 “The Economics of Cooperation”
Pages 399-400 “The Supply of Labor”
Page 414 “Compensating Differentials”
Page 442 “Utility”
Page 465 “Utility: An Alternative Way to Describe Preferences and Optimization”
Pages 484-489 “Asymmetric Information”
Pages 556-558 “Technological Knowledge”
Pages 578-580 “Financial Intermediaries”
Pages 598-600 “Present Value: Measuring the Time Value of Money”
Pages 603-604 “Diversification of Firm-Specific Risk”
Pages 606-609 “The Efficient Market Hypothesis”
Pages 630-631 “The Economics of Unions”
Pages 703-705 “The Prices for International Transactions: Real and Nominal Exchange Rates”
Pages 707-708 “The Basic Logic of Purchasing Power Parity”
Page 833 “Time Inconsistency”
December 15
Avinash Dixit
There is a brief biography of Avinash Dixit.
Textbook References:
Chapter 16 “Monopolistic Competition”
Pages 370-378 “The Economics of Cooperation”
Pages 566-567 “Property Rights and Political Stability”
September 28
Bill Clinton Channels Friedrich Hayek
Bill Clinton suggests that policy is often made by people who don't know what they are doing.
Textbook References:
Pages 32-33 “Why Economists' Advice Is Not Always Followed”
Page 358 “Galbraith versus Hayek”
June 10
Amazon Number One
Frederic Hayek's book The Road to Serfdom is number one in sales at Amazon.com.
Textbook References:
Page 358 “Galbraith versus Hayek”January 25
Hayek vs Keynes Rap
There is a short video of a rap song that presents the differences between Keynes and Hayek.
Textbook References:
Pages 8-10 “Principle 6: Markets Are Usually A Good Way To Organize Economic Activity”Pages 10-12 “Principle 7: Governments Can Sometimes Improve Market Outcomes”
Page 358 “Galbraith versus Hayek”
Page 750 “The 2008 Fiscal Stimulus”
Page 770 “The Origins of Aggregate Demand and Aggregate Supply”
Chapter 34 “The Influence of Monetary and Fiscal Policy on Aggregate Demand”
Pages 830-832 “Should Monetary and Fiscal Policymakers Try To Stabilize The Economy?”
November 9
Unintended Consequences
David Meltzer and Zhuo Chen argue that there is an inverse relationship between the real minimum wage and the average body mass index of Americans.
Textbook References:
Pages 7-8 “Principle 4: People Respond to Incentives”Pages 119-121 “The Minimum Wage”
Pages 348-354 “Competition with Differentiated Products”
Dec. 13
Interview with Marty
There is a video of an interview with Martin Feldstein. Martin addresses the auto bailout, Fannie Mae and Freddy Mac, and real interest rates.
Textbook References:
Pages 7-8 “Principle 4: People Respond to Incentives”
Pages 298-300 “The Firm’s Long-Run Decision to Exit or Enter a Market”
Pages 348-351 “Competition with Differentiated Products”
Chapter 26 “Saving, Investment, and the Financial System”
Page 821 “Bernanke’s Challenges”
Dec. 11
Stiglitz on the Auto Industry
There is a link to an article by Joseph Stiglitz that argues that the U.S. automakers should be allowed to fail and go through chapter 11 bankruptcy
Textbook References:
Pages 298-300 “The Firm’s Long-Run Decision to Exit or Enter a Market”
Pages 348-351 “Competition with Differentiated Products”
Chapter 26 “Saving, Investment, and the Financial System”