Month: July 2011

The Free Market Has Been Framed

I came across this video by Jacob Spinney. It does an excellent job of explaining all the different factors that contributed to the economic crisis and completely destroys the myth that the free market was responsible. How can something that does not exist be blamed for what is happening?

Prices and Consumption: Summary of “Man, Economy and State,” Chp. 4

This is part four of my summary of Murray Rothbard’s Man, Economy and State. You can read part three here.

In the previous part, I mentioned the advantages of having a common money that everyone uses for exchanges. One of the advantages is that it becomes easier, for a business, for example, to tell how much they have gained or lost. Without a common money, it would be harder for them to know whether they are making a profit. If instead of acquiring money for their services, the business was being paid in televisions, mattresses, and shoes, it would be hard for them to know exactly how much they have gained in exchange for their services, since in order to find that out, they would have to somehow figure out what they would be able to exchange the televisions and shoes for. Continue reading

Indirect Exchange: Summary of “Man, Economy and State,” Chp. 3

This is part three of my summary of Murray Rothbard’s Man, Economy and State. You can read part two here.

In my summary of chapter two, I talked about direct exchange, which takes place when a person exchanges a good for another good, that he plans to use.

A barter economy, one consisting only of direct exchanges, is very limited. In this type of economy, if I am interested in something that you own, I must find something that I own, that you are interested in, so we can make a trade. What if you do want to get rid of something that I want but I don’t have anything that you want? In this case, a trade cannot occur. Continue reading

Direct Exchange: Summary of “Man, Economy and State,” Chp. 2

This is part two of my summary of Man, Economy and State, by Austrian Economist Murray Rothbard. You can read part one here.

In my summary of chapter one, I talked about Praxeology being the study of human action, and about how humans act, by making use of certain means to achieve ends. Those means, I mentioned, are called goods. Goods need to be produced and it would be inefficient for a man to have to produce all the goods that he would like to utilize.

Chapter two focuses on the direct exchange of goods. Jim might have a product he has no use for, and would like to exchange it for a product owned by James. James, coincidentally, has no use for the good that Jim is seeking, which makes the trade beneficial for both parties. Continue reading

Fundamentals of Human Action: Summary of “Man, Economy and State,” Chp. 1

This is part one of my summary of the classic and massive book, Man, Economy and State, by Austrian Economist, Murray Rothbard.

Praxeology is the study of Human Action. Human Action is defined as purposeful behavior; actions that human beings consciously take, by making use of certain means, to achieve ends in order to end up in a better state then we previously were. All purposeful action can be looked at in this way; from acting on a decision to go from standing to sitting, to acting on a decision to purchase a nicer car. When a person decides he would rather sit than stand and he acts on this desire, he is utilizing the following means in order to end up in a more comfortable state: the chair, labor and time. The act of walking toward the chair is the labor involved, and of course, all action takes place through time. Continue reading