FOO Law and Economics

Sunday, February 1, 2009

Ten new ideas in economics: from Bryan Caplan

In the good tradition of David Letterman, here are the "top ten" of economics in the past half-century or so, courtesy of Bryan Caplan.

1. Human capital theory
2. Rational expectations macroeconomics
3. The random walk view of financial markets
4. Signaling models
5. Public choice theory
6. Natural rate models of unemployment
7. Time consistency
8. The Prisoners' Dilemma, coordination games, and hawk-dove games
9. The Ricardian equivalence argument for debt-neutrality
10. Contestable markets

For those studying the Philippine economy, nos. 1, 5, 8, and 10 are perhaps the most interesting fields.

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Economics as Zen

The market is like a post-impressionist painting.. The close view is no more real than the far view.. That is all.
-- Deirdre McCloskey

Ponzi units ... make position by selling out positions.
-- Hyman Minsky

Words ought to be a little wild, for they are the assaults of thoughts on the unthinking.
-- John Maynard Keynes

The wish is father to the thought.. What it means is that the wish is the father of faith.
-- Ludwig von Mises

T. S. Eliot wrote about the bottoms of trousers worn rolled

Having long toiled within a behemoth, I have since decamped to a quiet bay, at times on a single outrigger. I contemplate how social order and the economy interact. And what it's all about.

I've come to realize, painfully, that opportunity cost shatters the lenses of artificial privilege and self-delusion -- either you can or can't, whatever be the object. Why? Because opportunity cost is the next best thing.

Contemplation works.

-- Orlando Roncesvalles