Third lecture home study course

The third lecture in the Mises University home study course is called 'Mises in one Lesson - history of Economic Thought' given by Murray Rothbard. Total time is 56:38.

He starts out with a very brief history of the Austrian school, mainly that while the founders of the Austrian school of economics were, very naturally, Austrian, there are not so many now. Most 'Austrian' economists are now of course, from many other countries.

He then talks about Human action. Austrian school is based on individuals doing things, most other schools of thought focus on groups or aggregates.

When Carl Menger was working, the predominant school then was the classical school, Smith, Ricardo, etc. He gives examples of their thinking.

Rothbard then gives an analysis of the main points of Austrian economic thought. (This is not complete, just the points I wanted to remember.)

1. Purpose of production is consumption
2. Start with consumer demand and work backwards to factors of production
3. Make value judgements in marginal units
4. Not quantative, but value is subjective
5. Time preference - we want things now, not later
6. Earlier phase of production = higher order of goods
7. Entrepreneurs are very important

He then talks about Mises Theory of Money and Credit (Note: I have not read this book yet). Again, Rothbard covers the main points of this book.

1. It integrated micro and macro economics
2. applied marginal theory to money and credit
3. only real use of money is exchange
4. fractional reserve banking is basically fraudulent
5. increases in money and credit causes price increases and messes up the capital structure
6. increases in money supply increases interest rates
7. results of recession (a natural process) washes out imbalance between capital and consumer goods
8. necessary liquidation process, if government interferes, this prolongs the recession

These last points are obviously applicable to our current financial situation.

This was another excellent lecture, with a lot of information.

Second Lecture of Home Study Course

I've listened to the second lecture of the home study course. It's called Marginalist Revolution by Joseph Salerno. He starts out with the information that the law of marginal utility was discovered at almost the same time by three men: Carl Menger, an Austrian, an Englishman, William Stanly Jevons and a Swiss, Leon Walras.

Carl Menger is considered by Salerno to be the sole founder of the Austrian School. He then talks about the classical school of economics and it's differences with the Austrians. He spends a large amount of time discussing marginal utility, using the common cow/horse scenarios.

All in all, an interesting lecture. It was obvious he was writing on a board to the audience, which of course you cannot see. I'm looking forward to listening to the next one.

Mises University 2009

Yet more resources from the amazing mises.org. Last year at Auburn University, a week long gathering called Mises University 2009 occurred. Here is an article about it written by a participant, and all of the talks mentioned and more are freely available at this link.

I am constantly amazed at the quantity and quality of information available online for free. Even the website is open source and free. For information on all that mises.org does to promote the cause of freedom, check out this article "Mises.org joins the fight for liberty".