Suchergebnisse

In this updated and expanded edition, the author explores the broad features of Hayek's economic philosophy, shows the interrelationship between the liberal philosophy and economic advance, examines Hayek's approach to the problems of a money economy, and explains Hayek's aversion to all forms of centralized economic planning.

AbstractWhere classical economics integrates the quantity theory of money with the concept of Ricardian equivalence, the tendency of recent macroeconomic presentations is to focus either upon money and inflation or upon taxation and debt. That neglect of classical monetary–fiscal integration is surprising, given an initiative by the International Monetary Fund that set credit, money, and fiscal policy within a single structure. This article places those 'credit counterparts of broad money' in the context of the Great Depression and the recent global financial crisis. The upshot is a set of conclusions: that, to counter the prospect of deflation, quantitative easing is a weak policy response; that fiscal deficits are better; and that cuts in taxation are preferable to increased government spending.

AbstractEvents in the wake of the 'credit crunch' can be understood only against institutional structures within which interdependent monetary and fiscal policy are administered. In the Eurozone, the attempt to keep a central monetary authority (together with its associated national central banks) independent from 17 diverse fiscal authorities was flawed. When sovereign debt approaches unmanageable levels, the Maastricht Treaty presents austerity as the single option. In the UK, the electorate has an opportunity to choose between monetary financing (inflation) and fiscal consolidation (austerity). Policy choices within the Eurozone and the UK are set against Keynes's focus on unemployment and more recent concerns to retain (or restore) price and/or financial stability.

Short courses in economics carry an implicit warning: superficial analysis leads to simplistic conclusions. Where textbooks might be forgiven, a Nobel‐Prize‐winning economist who builds upon that superficiality deserves a reprimand.

That progressive taxation might offset a disproportionate burden of indirect taxes upon low income households sits at the heart of a suggestion from Friedrich Hayek. This concerns the manner in which a degree of progression might be accommodated and constrained to preclude arbitrary tax hikes upon minority income groups. While Hayek's proposal is permissive of socialist aims, it looks for efficiency in resource usage as reflected in the aspiration 'that each should feel that in the aggregate all the collective goods which are applied to him are worth at least as much as the contribution he is required to make'.