China’s President Xi Jinping is a devotee of Austrian economics. Unfortunately, he does not follow the enlightened and intelligent economics of the “Austrian School” — Eugen von Böhm-Bawerk, Ludwig von Mises and Friedrich Hayek. Instead, China’s attempts to dominate the economies of its neighbors through “Belt and Road” investments, its use of slave labor, its […]

The Nobel prize in economics this year went to Ben Bernanke, Douglas Diamond and Philip Dybvig for “work adding to understanding of the relationship between banking crises and the broader economy.” Like other Nobels, the prize has a mixed reputation, having been given to outright Marxists like Gunnar Myrdal in the past. Looked at that […]

The Bank of England re-instituted “quantitative easing” last week because British pension funds were threatened with insolvency, having hedged their bond portfolios with unstable derivatives. We have seen this movie before, in 2007-08. Dopey behavior by financial institutions, central banks and regulators causes a massive unnecessary financial crash that blights the lives of billions of […]

Conventional wisdom has it that James Watt invented the steam engine, which became economically important in the 1780s, setting off the Industrial Revolution. All three of those beliefs are wrong. This column will lay out the true process, which was a 3-stage one over a century in duration, intensifying the Industrial Revolution but not directly […]

I am glad I am not rich! If I were, I would be subjected to bombardment by the financial services sector, attempting to sell me fancy products just when they are going out of style. The plumbing of financial services is very apparent: as far as possible you want to get to the source of […]

Since the middle 1990s, investors and entrepreneurs have focused almost solely on the youth market, generating endless devices and amusements for youth. Many of these (smartphones, for example) older people can use only with difficulty, because of limited eyesight or coordination. This has been demographically foolish and has increasingly stymied economic growth. The real opportunity, […]

Prime Minister Liz Truss’s £150 billion subsidy to energy consumers is yet another economically foolish policy, of a type that have been regrettably predominant since Lord Liverpool left office in 1827. For a country where previously sound policies had produced the Industrial Revolution, Britain has developed a remarkable propensity to shoot itself in the foot […]

Edward Chancellor’s admirable “The Price of Time” (Allen Lane, 2022) demonstrates clearly that interest rates are a matter of time preference; lenders charge interest because $1 today is worth more than $1 in say two years’ time. That is all very well, but at present, with markets heading downwards, interest rates heading upwards and interest […]

President Biden’s lax immigration policy has one inescapable economic effect: it lowers the earnings of low-skill Americans. Conversely, the policy of the 1620s and 1630s that shipped convicts and the indigent to the American colonies as indentured servants had a remarkable positive effect in reversing the hundred-year decline in real English wages. The recent failure […]

U.S. non-farm labor productivity declined at a 4.6% annual rate in the second quarter of 2022, following a 7.4% decline in the first quarter. Although predictable from the expansive employment numbers and the declining GDP, this is shocking news, which the media have largely ignored. There also seems little likelihood of a near-term reversal. Like […]