On history, economics, philosophy & the written word
Almost everything in public life eventually comes down to economic questions — which makes it worth getting the economics right.
Smith's "system of natural liberty" was always embedded in a moral framework — one we have quietly forgotten. Everyone who has taken an introductory economics course knows the phrase. Few have read the two sentences surrounding it.
Continue reading"In the long run we are all dead." It is perhaps the most frequently quoted — and misunderstood — sentence in the history of economic thought. Keynes was not being nihilistic. He was making a precise methodological argument about the limitations of equilibrium analysis.
Continue readingWhat is prudent for the individual household can be catastrophic for the economy as a whole. The paradox of thrift is one of the clearest examples of how our moral intuitions about money — formed at the household level — fail to scale to the national level.
Continue readingTwo centuries after David Ricardo proposed it, comparative advantage remains difficult to explain, easy to misrepresent, and almost universally ignored in political debate. It also happens to be correct — and understanding why changes how you see trade entirely.
Continue reading