Archive | Economic Theory

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What is Entrepreneurial Judgment?

Nicolai Foss and Peter Klein give a full overview of judgment in chapter 4 of their book Organizing Entrepreneurial Judgment. Foss and Klein present an overview of the economic literature which treats entrepreneurship as judgment and proceed to flesh out the attributes of judgment. They conclude the chapter by suggesting that investments should be the…
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What is Entrepreneurship?

Foss and Klein dedicate the second chapter of their book Organizing Entrepreneurial Judgment: A New Approach to the Firm to putting forth the best definition of entrepreneurship. Although entrepreneurship studies is one of the fastest growing fields in colleges and universities around the world, FK argue that there is still much work to be done…
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Harry Reid’s Olympic-Sized Fallacy

Senate Majority leader Harry Reid thinks that the U.S. Olympic Team’s uniforms—made in China as they were—deserve to be burned. He reasons that we have an abundance of unemployed textile workers in this country—why shouldn’t we take advantage of them to manufacture the Olympics uniforms? Wouldn’t that put these Americans back to work? There are…
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Africa Partnership Station

The Economic Kindness of In-Kind Donations

The popular humor website “Cracked.com” recently published a thought provoking article entitled “5 Popular Forms of Charity (That Aren’t Helping).”  The five charitable activities mentioned were (1) awareness campaigns, (2) donating clothing, (3) choosing your charity based on its overhead, (4) earmarking donations, (5) volunteering after disasters.  The author’s arguments for why each of these…
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Banknotes and fractional reserve

Economist Larry White at George Mason University submitted a thought-provoking written testimony the other day. Discussing the issue of fractional reserve banking before the House Subcommittee on Domestic Monetary Policy and Technology, he made the following claim: For payment by account transfer, FRB offers a more economic way of providing payment services. A money warehouse…
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Krugman does not understand Austrian Economics

The title should be no surprise by now.  Paul Krugman–arch-Keynesian–is once again misrepresenting what Austrian economics is. Krugman thinks the recent financial crisis can test (and prove) the superiority of Keynes prescriptions for an ailing economy. Before we delve into the specifics, consider the alternatives Krugman proposes: classical economics (he considers Austrian among them) and…
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hollande

Why we need financial markets

“My true adversary in this battle,” he said “has no name, no face, no party… it is the world of finance.” Thus spoke new French President Francois Hollande while campaigning last month. Despite the seeming backwardness of such sentiments, it is no secret that many people actually do feel a degree of animosity toward the…
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