Thursday, March 27, 2014

The Energy Price Competition Rabbit-Hole

This morning there's a debate on competition in the energy market in the UK - the coalition government has set up a committee, which will provide results in 2016 and Labour says that were it in power they would introduce a price freeze today. Meanwhile one energy company has introduced its own price freeze, paying for it by laying off a large number of employees.

Analysts explain that although there are only a "Big 6" energy companies, there are only a "Big 5" supermarkets, but there is price competition among them--only if the other energy companies follow suit and introduce a price freeze too will it show competition among energy providers, which no-one expects--the difference? It is easier to change which supermarket you shop from, prices are easier to understand, and especially there are fewer taxes affecting their prices. If they find a problem, the competition committee would recommend, among other changes, moving those taxes into the general budget.

Wait ... aren't those taxes there to reduce energy usage to help prevent global warming? And if a price freeze was introduced, as Labour recommends, won't we see a lot more layoffs? Inevitably, this kind of chain of unintended consequences tends to lead to nationalisation, but consider the state-run energy companies, or semi-private ones like Gazprom in Russia, they do not tend to be corruption-free, separate from military-industrial policy, and in any way transparent... How should the UK avoid this rabbit-hole?

Thursday, March 20, 2014

Coming Soon: my course on Marginal Revolution University

Starting within about a week, my course will be up on -- you can start the course as soon as its up there, but it is a flexible system so if you can't start right away, that should be fine. You can check out the video lecture titles here (scroll to the bottom), and I will post again when it's all up there!

Tuesday, March 11, 2014

Palgrave's FREE ACCESS month of March

Access all of Palgrave's journal articles (but sadly none of their books or chapters of books) all March long! This includes--sorry, bit more self-promotion--my articles for Comparative Economic Studies, which can be found here.

Wednesday, March 5, 2014

My new book is out - and was featured in Palgrave newsletter!

The March newsletter "Your Economics Update from Palgrave Macmillan" lists my book as the Featured Title! So cool - definitely a first for me :) and an honour.

Featured Title

Spontaneous Order and the Utopian Collective

Spontaneous Order and the Utopian Collective

In Spontaneous Order and the Utopian Collective, Nell takes her cue from the personal writings and documents of Lenin, Trotsky, and Bukharin to consider them anew from an Austrian theoretical perspective, analyze the divergence between theory and practice using a spontaneous order framework, and identify three interconnected prerequisites necessary for a utopian collectivist society... read more

Thursday, November 21, 2013

How to tell if your representatives is just a bigot

There are many states in the American South that do not want to grant any benefits of any kind to same-sex couples, and have constitutional amendments prohibiting same-sex marriage, which they hoped would let them deny benefits to such couples. However, the U.S. federal government prohibits discrimination of this sort with its equal protection clause of the 14th amendment.

So, Oklahoma Drops National Guard Benefits For All Couples To Avoid Serving Same-Sex Couples -- and they are not alone, as the article explains: many of these states have dropped benefits or changed other laws in order to get around the federal ban on discrimination enumerated in that constitutional amendment.

Wow... what pure, plain, bigotry - plain as the nose on your face ~  but, at least it can act as a nice acid test: if any libertarian supports this you know they are twisting their philosophy into gnarled and crooked knots, or pretzels, because they are actually secretly social-con (read: bigoted). How can I be so sure? Well...

Except for anarchists, national defense, which includes each state's national guard, is generally considered one of the few appropriate functions of government  (along with police and courts, and administrative, legislative, executive...), so this makes these national guard some of the few legitimate employees hired by government according to libertarian thought.* Unless all employees of government, federal, state and local, should lose their health benefits--without replacing the benefit with a cash equivalent--the libertarian should be against such a policy. It is clearly a policy passed for "religious" (read: bigoted) reasons, not for economic efficiency or for justice, and it treats people with favoratism, or rather the reverse, with prejudice.

These national guard are (former/current) employees of government -- not welfare recipients--although, of course, if they cannot receive health care coverage from their employer they may end up on welfare... Anyway, it is clear that the benefit bill was not too high for the taxpayer/voter of the state until such time as they were going to have to give those benefits equally to homosexual couples as to heterosexual ones, so unless there are a very significant proportion of the state's national guard or overall population that is gay, it is not a budget issue. Clearly the cancellation of the health care policy was done in order to prevent gay couples from being given these benefits, purely out of bigotry.

* In fact, constitutionalist libertarians and peacenik libertarians should find the national guard preferable to the large national standing army, since it is a reserve army and power is decentralized to the states. Again, on the question of federalism and states' rights: NO, a single state cannot overrule the basic human rights respected and ensured at the federal level, by the constitution. That's why it's only what is left out that is "reserved to the states respectively, or to the people"...

Thursday, September 26, 2013

One Last Call - Individualism and Society

There is still space in the second volume, on individualism and society. I would like to see at least one or two more contributions, and in particular I would like to see additional essays tackling the difficult and important question of subjectivism/methodological individualism and the problems with "rational economic man." The two-fold issue (and essay may choose one of these two to address, as both are already massive) as I see it:

1. Can we really treat all economic action as stemming from the individual - atomistic, isolated, decision-maker making choices separately from his/her surroundings--and if we can't then how can we defend Austrian and neoclassical subjectivism, seeing as it does root all economic behaviour in this individual action?

2. Austrian, neoclassical, and public-choice economics relies on assumptions very much like "rational economic man," with his self-interested motives and calculating mind--otherwise there would be no assumptions of rent-seeking, responding to institutions with the usual incentive-driven behaviour, etc. We have long known that "rational economic man" is an absurd simplification, the truth of which, to the extent there is any, is embedded in market-derived culture and institutions. Yet we know we also cannot drop the assumptions entirely and assume an infinitely malleable human nature--this sort of assumption was what allowed so many to falsely believe socialist institutions might yield a utopian society and "new man." How can we reconcile these dual understandings of the complexity of human nature?

On the second point, it might be interesting to discuss viewpoints such as: 

Rational Economic Man, by Martin Hollis and Edward Nell
Don Lavoie on Hollis and Nell
"Knowledge and Rationality in the Austrian School: an Analytical Survey," Richard N. Langlois

and/or Beyond Economic Man, by H. Leibenstein && Beyond Economic Man, by M. A. Ferber and ‎J. A. Nelson

Let me know ASAP if you have any interest ~ liberty at economicliberty . net ~ the final deadline for the entire volume is March 1st, I would need an abstract and outline by November and a draft by January 1, and final draft by February 1st.

Wednesday, September 4, 2013

Diseases of Times Past

Both malaria and AIDS look like they will soon be categorized as such, thanks to a mixed - public and private - strategy of funding, internationally. The new AIDS vaccine and the new malaria vaccine both showing promise. I love it -- welcome to the star trek age!

Tuesday, August 20, 2013

Basic Income and The Free Market - Available Now!

At least, available for pre-order. More exciting even is how beautiful the cover looks on the actual book (they sent us advance copies) and the wonderful back-cover blurbs it got!

"This volume explores an important topic: what is the role, if any, of a Basic Income Guarantee in a free society? In answering this question, Basic Income and the Free Market provides a variety of perspectives and viewpoints that will be of interest to a wide range of readers, from scholars to policymakers. No matter what your ideological leanings, you will surely find something in this volume that challenges those views. I highly recommend it to anyone interested in the foundations of a free society." - Christopher J. Coyne, F.A. Harper Professor of Economics, George Mason University, USA

'A real conversation starter. Austrians will be challenged by the Basic Income Guarantee, and its advocates will be challenged by Austrian theory. Guinevere Nell has opened up a new, balanced, and promising dialog.' - David Prychitko, Professor of Economics, Northern Michigan University, USA

Hopefully, the paperback will be cheaper, but in any case please ask your library to order it if they have not, spread the word, read it and leave a review on Amazon, etc.!!

Friday, May 17, 2013

Two sides to Chavez? Difficult legacy?

After reading this description of life under Chavez posted on Reddit, assuming it's all true (and it does link to sources), I had a hard time swallowing the arguments made here in the Globe and Mail that there are "two sides" to Chavez that are difficult to reconcile... In fact, each "success" recounted has a clear refutation or response in the first-hand (and citation-supported) account posted on Reddit. I give the arguments and responses below (indented quotes from the Reddit account, italics from the Globe and Mail piece). I start with the first "puzzle" described -- his mixed record on democracy:

Mr. Chavez was proud of his democracy and to his credit, he installed what is probably the most tamper-proof voting system in the Americas. The opposition did not contest his 55-per-cent majority in October’s presidential election, nor is there much dispute about the overwhelming success of his party in December’s gubernatorial elections. (His candidates won 20 of 23 governorships.) However, reliable results on election day do not compensate for the loss of the country’s independent judiciary, the politicization of the electoral tribunal, the muzzling of much (not all) of the opposition media, the flagrant abuse of state resources for government candidates – in other words, the tilting of the electoral playing field and the removal of checks and balances.

The article implies that he's brought about some measure of democracy, as it says he brought tamper-proof voting system, but then the rest of the paragraph describes how it's actually a completely corrupt system that's in place. It's easy to make voting fair when you rig the election in your own favour! That's not puzzling, that's dictatorship 101.

Illiteracy has all but disappeared in Venezuela.

Really, this is attributable to Chavez? I'm wondering how great the education system is, if:

The buildings are falling apart. The roads are falling apart, as is the entire infrastructure. The Caracas metro has gone from one of the greatest in the world to one of the worst. Building projects never get finished. 

Education and free health care are almost universally available.

Hm...The Reddit account says:

During the rainy season, land and mudslides are a common occurrence, which blocks roads, and destroys thousands of homes, leaving tens of thousands homeless each year. This is not being helped as the government builds very little housing for the poor and because the houses in the barrios where these landslides happen have no foundation and are simply bricks on top of earth or concrete. The poor are not better off. There are some hospitals and clinics in the barrios, and many outside, but they are all severely understaffed and are all suffering from severe shortages of medicine and medical supplies, such as saline.

He has succeeded in partially closing the huge gap between wealth and poverty. 

Has he? It's not just that he might have done this by impoverishing some who were previously above the poverty line, he's also letting some people become very rich... just for starters:

As of right now, the inflation is approximately 22.1%, one of the highest in the world. In addition, the Bolivar is currently valued at 6.3 Bolivars to the USD. However, nobody uses this value as it's absolute bullshit. The correct rate is about 26.4 bolivars to the USD as of right now...

This is a scheme to make the rich richer, offering much chance for corruption and theft from the worst off... as it goes on to say: 

[There are] absolutely untold amounts of corruption in the government. Governors of states have been found trafficking drugs to the states or have been found stealing millions and millions of dollars from public projects, like the Valencia metro.
Wealth may now come more from corruption and politics than business, but I betcha the gap between rich and poor is still there.

Improving the quality of life for millions at the bottom levels of society is no small achievement.

It would be -- but it's not at all clear that this has occurred. In addition to the lack of adequate housing, does this sound like better quality of life? (apologies for minor repetition)

As a result of this and of the price controls on various products such as eggs, oil, toilet paper, chicken, beef, medicines, milk, cement, rent, sugar, and flour, there are constant shortages of these necessary products as well as staple foods, such as rice and potatoes. There are many times where milk isn't available for weeks or months at a time, or oil or flour or sugar...what about what it's actually like to live here under Chávez? Well, the murder rate is currently 45.1 per 100,000, while Caracas currently has the 6th highest murder rate of any city in the world at 98.71 per 100,000. Not to mention the thousands of kidnappings a month. I have many friends who have been kidnapped for ransom as well as the more recent examples of the Mexican embassador being kidnapped and more.

The buildings are falling apart. The roads are falling apart, as is the entire infrastructure. The Caracas metro has gone from one of the greatest in the world to one of the worst. Building projects never get finished. The port in La Guaira is currently being "modernized" and can only handle 1 ship at a time, maybe 2 if we're lucky and the planets are aligned, driving prices even higher, making products rarer and causing shipping companies to be less likely to dock here as they can be anchored off of La Guaira for weeks at a time waiting to be unloaded. The runway at the airport is falling apart, causing constant delays. The road to the airport gets blocked by landslides all the time, effectively cutting the city off.

He also imparted to these millions a sense of dignity about themselves and pride in their leader’s often bombastic rhetoric.
Oh great, he's forcing people to express "pride" in his arrogant, corrupt ass. Brilliant.

Does Mr. Chavez’s good outrank Mr. Chavez’s bad? Probably, but taken together, they make a difficult legacy. 

~ really? "probably"? And Castro too? How about Stalin?

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Wednesday, May 8, 2013

Fuller description of two volume series on Free Institutions and Cultural Change

Here is a fuller description of the double collection:

Austrian Economic Perspectives on Market Organization


Austrian Economic Perspectives on Individualism and Society


The primary uniting theme for the Free Institutions and Cultural Change double essay collection (or series) is the question of whether the spontaneous order/s of the unhindered free market society offer the best society, and how insights from other heterodox schools should (or should not) modify the Austrian model of spontaneous order. This will be split into two volumes: (1) economic organization and (2) cultural and social questions.

Volume one: Austrian Economic Perspectives on Market Organization  Contributors who will offer full visions of society, asking questions about economic organization, will be in the first section. This will likely include much discussion of spontaneous order, market socialism, corporatism, communitarism, anarchism, those arguing for new kinds of systems and those arguing against such visions, and in general those interested in discussing the overall structure of society.

Volume two: Austrian Economic Perspectives on Individualism and Society  The second section will focus on culture, society, and problems with the concept of individualism or collectivism. It will ask whether the Austrian basis in methodological individualism is theoretically sound, and whether the spontaneous order of the market needs to be supplemented with the social order. Insights may come from feminism, community-oriented anarchism including anarcho-communism and mutualism, and even other social sciences such as anthropology, etc.

Full Description

Is there a justifiable role for the state (the people as a democratic collective) beyond the mere protection of individual rights to life and property--should there be redistribution, public ownership, or intervention in the economy? Austrians and market socialists - along, perhaps, with other heterodox economists - agree on the flaws of mainstream economic methodology and the reasons for the failure of planning, but disagree on this central question.

The Austrian framework of evolutionary spontaneous order made up of individuals acting, when modified by an understanding of evolutionary cultural change, and by a concession of the right of all individuals to a portion of the value of natural resources, provides a powerful theoretical starting point for bridging the gap between free market and market socialist policy perspectives.

The value of land could be redistributed as a basic income guarantee without sacrificing free market ideals, as discussed in my forthcoming collection on the topic; but what if we changed limited liability corporation laws, and the like? This kind of change would have effects that interact with and foster social and cultural change, and could be supplemented with other changes that, although they involve redistribution, might be acceptable to Austrians if they concede the right of individuals to a portion of the Earth's natural resources.

If Austrians can be more flexible, rejecting the laissez-faire fundamentalism they are often known for, they may find much common ground with other heterodox schools. This two-part essay collection aims to find and nurture this common ground through explorations of alternative systems and models that achieve the dynamic efficiency and welfare goals of all economists and social scientists.

Volume 1: Austrian Economic Perspectives on Market Organization

Essays in the first volume will discuss forms of organization (communist, exchange, hierarchical) in terms not only of their economic efficiency, but also their affect on morality and social exchange. There will be contributions from economists and other social scientists, and in particular from Austrian economists, market socialists, and anarchists. Contributors will analyze the social, political, and economic system as a whole, and argue for the best way to organize the system for economic efficiency as well as welfare of the people, and may offer a proposal for radical institutional change or an argument against such a proposal.

Austrian economists might consider whether a corrective is necessary for “really existing” markets, which are affected not only by intervention, but also by inheritance over many generations of wealth and privilege not all of which was earned in a way that Austrians would consider fair. In the market system any advantage, be it from inheriting land wealth or the luck of intelligence, good parents, and healthy body, may exponentially multiply the person's future advantage and market power.

The collection explores areas of theoretical agreement between Austrian theory and market socialist economics and other heterodox schools of economic and political science; in the first volume, spontaneous order and other Austrian theories will be complemented with insights from less free-market schools of thought and used to analyze various forms of social and economic organization. Some of these include: corporation-status, co-operatives, communitarian structures, income supports, land redistribution, subsistence communities, private property based and communal anarchy, decentralized democracy, and other political structures.

Proposed Chapter Outline

Part One: Criticisms of the Market and Possible Alternatives
1.   Introduction (Guinevere Nell)
2.  “The New Market Socialism” (Peter Abell)
3.  “Money, Markets, and a Non-Market Socialism” (Anitra Nelson)
4.  “The Evolution of Market Society: A True Third Way” (Guinevere Nell)
5.  “Spontaneous Order and the Market’s Complex Relationship with Democracy” (Gus diZerega)
6. “The Problem of Unemployment When Markets Clear” (Daniel Kuehn)
7. “Austrian and Contested Exchange Price Theory” (Andrew Farrant and Edward McPhail)
8. “The Firm and the Authority Relation: Hierarchy vs Organization” (Per Bylund)
8. “Austrian Marketocracy” (Leslie Marsh and Corey Abel)
9. “Market Anarchy, Market Democracy” (Gary Chartier)
Part Two: Criticisms of Proposals
1. Replies and Rebuttals

Volume 2: Austrian Economic Perspectives on Individualism and Society

The second volume will bring together economists and political scientists with an interest in evolutionary social and cultural change and spontaneous order. Spontaneous order and other Austrian theories will be complemented with consideration of culture and social and communal interaction. This volume aims to bridge some of the divisions between free market advocates stressing individual rights and individualistic culture and left-leaning thinkers who stress social justice and a culture of social solidarity, or collectivism.

Austrian school economic theory recognizes the importance of subjective value, consumer sovereignty, and spontaneous order. The market is not the only spontaneous order in society, and the market order and its surrounding cultural spontaneous order are interconnected and self-reinforcing. Markets may channel profit-driven relaxation of prejudices or may allow a channeling of discrimination and an imposition of winning preferences upon the powerless in the system. The values and preferences of the individuals within a spontaneous order are shaped endogenously, part of the evolution of markets and culture.

Private property, exchange, and free markets may allow an evolution of culture and society. Yet, a fully free-market system based entirely on private ownership may preclude some aspects of social and cultural freedom. Communal activities and organizations may help to supplement the individualistic nature of markets and aid change in society and culture, and cultural change may be necessary for markets to truly serve our needs. Hierarchy exists within corporate firms, and other kinds of economic organization may offer benefits difficult to realize in a system based purely on private ownership; yet public ownership may create even more hierarchy, bureaucracy, stagnation, and corruption. Is there a way to improve upon both the free market and nationalization? Market socialist and other heterodox exploration of cultural and social factors may help to inform Austrian theory, while Austrian studies of spontaneous order may offer these schools a more rigorous framework for analyzing economic and social orders.

Proposed Chapter Outline

Part One: Criticisms of Austrian Theory
1.  Introduction (Guinevere Nell)
2. “The Spontaneous Orders of Market and Society” (Troy Camplin)
3. “Hayek and the Postmodern Road to Socialism” (Rob Garnett)
4. “Improving Spontaneous Orders” (Randall Holcombe)

Part Two: Replies and Rebuttals
1. Replies and Rebuttals