The Present Monetary System Is Heading for a Breakdown

Many economists incorrectly assume a growing economy also requires a growing money stock, assuming that economic growth gives rise to a greater demand for money. It is held that failing to increase money to facilitate increased trade will lead to a decline in prices of goods and services, destabilizing the economy and leading to an economic downturn.

Dr Oliver Hartwich: The Economic Miracle

Transcript

The German philosopher Georg Hegel once said, “The only thing we learn from history is that we learn nothing from history.” That was a pessimistic way of looking at things. But then again, I did mention that Hegel was German. Well, I am German too. But I also carry a New Zealand passport. And as it happens, I believe, possibly optimistically, that history can teach us a lot. If we all knew just a bit more history, the world would be a much better place. As another great philosopher said: “Learn from the mistakes of others. You can never live long enough to make them all yourself.” That was Marx, by the way. Well, not Karl Marx – Groucho Marx.

So let’s have a quick history lesson and see if we can learn something.

Matt Ridley: Montesquieu's "sweet commerce" and Cobden's "God's diplomacy"

The “ultimatum game” is a fiendish invention of economists to test people’s selfishness. One player is asked to share a windfall of cash with another player, but the entire windfall is cancelled if the second player rejects the offer. How much should you share? 

When people from the Machiguenga tribe in Peru were asked to play this game, they behaved selfishly, wanting to share little of the windfall. Not far away, the Achuar in Ecuador were much more generous, offering almost half the money to the other player — which is roughly how people in the developed world react.

What explains the difference? 

Karl du Fresne: Sauerkraut in Masterton - who would have thought?

I was mooching around in the kitchen the other day, generally getting in the way, as I do, when something caught my eye. It was a vacuum pack of German sauerkraut that my wife had bought at a local food outlet. Now who would have thought, in the New Zealand I grew up in, that in the future you’d be able to buy German sauerkraut (for the uninitiated, that’s fermented cabbage, which sounds gross, but it’s not) in a provincial town like Masterton?

I think back several decades to when I first lived in Wellington. Even in the capital city there was only one place where you could be confident of finding exotic foods such as sauerkraut, Gouda cheese and Bismarck herring.

Richard Epstein: The Obamacare Election

The Romney-Ryan plan is maddeningly vague, but at least it reduces the role of government in health care.

As the fractious 2012 presidential campaign careens down to a photo finish, no issue presents a starker contrast between the two candidates than health-care reform. President Obama is committed to implementing his elaborate reform of health-care markets by creating state exchanges, extending Medicaid coverage to some 25 million new enrollees, retaining the current reimbursement system for Medicare, and implementing an individual mandate.

Matt Ridley: The market as the antidote to capitalism

The anti-capitalists, now more than 50 days outside St Paul’s, have a point: capitalism is proving unfair. But I would like to try to persuade them that the reason is because it is not free-market enough. (Good luck, I hear you cry.) The market, when allowed to flourish, tears apart monopoly and generates freedom and fairness better than any other human institution. Today’s private sector, by contrast, is increasingly dominated by companies that are privileged by government through cosy contract, soft subsidy, convenient regulation and crony conversation.

That is why it is producing such unfair outcomes.