March 31, 2004
Solidifying my Foundations of Capitalism

The dividends of buying those Mises Institute books are already arriving and ready to be utilized.

While reading Chapter 3, "Economic Calculation," in An Introduction to Austrian Economics by Thomas Taylor, I think I experienced more epiphanies than I've ever experienced while reading a book. Things just clicked; logical connections were made and reinforced. The relationships among money, knowledge, resource scarcity, the subjective theory of value, marginal utility, and economic calculation (to name a few) are becoming clearer. This has been a thoroughly enjoyable and concise read so far.

This is probably because while I'm quite familiar with the practical necessities of a free market and the importance of keeping it "free," I have always been weaker on the theoretical side. And it's always the theoretical side you have to be proficient at in order to win an argument. The moment you make assertions, you've got to back them up with reasoned theories, otherwise those assertions can and will be ignored. If I can't explain the critical nature of a system of free market pricing, there's no point in trying to convince reasonable people that government efforts to intervene in the marketplace cause incalculable and unpredictable harm.

This may have been the the best $5 I've ever spent on literature.

The tendency to ascribe to the market economy the characteristics of being something other than the events caused by the choices and actions of individuals is incorrect. The market arises as a result of the willingness of individuals to interact. Every development in the market is the outcome of purposive actions on the part of individuals who are seeking to improve their own state of affairs.


- Thomas C. Taylor, An Introduction to Austrian Economics, pg. 52


The quoted statement above will now become Magnifisyncopathological's new banner motto. Quot homines tot sententiae ("many men, many minds") I liked and actually like even more considering the material I've just read on the subjective theory of value. It will now become the individual post banner motto.



Posted by Drizzten at March 31, 2004 08:29 AM

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Dammit. Now I'VE bought a few books, too. You're a persuasive man, Chaz.

Posted by: Erik on March 31, 2004 02:10 PM

Heh.

I get home yesterday and crack open Chapter 6, and slog my way through it without anything substantial sinking in. Taylor was writing about how prices are calculated on the producer's side and used the example of an Evenly Rotating Economy (a term coined by Rothbard) to explain how Austrians see those prices are created. In addition, by doing so, he produces the Austrian refutation of the Marxist exploitation theory...that labor is exploited because workers aren't paid the price of the products they create.

All important stuff, obviously.

Arrgh, but for some reason the terminology he used just didn't flow as well as in the preceeding chapters. I lost count how many times I went back and re-read some passages to try and understand the concepts he was conveying. In the end, I think I "got it," but not enough to ever bring up in a debate and I certainly don't regret getting the book.

But Chaz spoketh too soon! :)

Posted by: Drizz on April 1, 2004 08:53 AM
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