Stationary Bandit

Does Anyone Read “The Road to Serfdom”?

Too many very intelligent people (see here and here) seem to have caricatured “The Road to Serfdom” as a simplistic argument that regulatory interventions into the economy lead to a slippery slope towards totalitarianism.  One intervention begets another.  Like many of Hayek’s writings, his hypothesis is never that simple.  The road to serfdom occurs, according to Hayek, if the interventions lead to a change in beliefs about the proper scope of government.  In the introduction to the 1956 edition (which is readily available), Hayek restates his argument and explicitly states that its validity depends on changes in ideas.  He wrote that “the most important change which extensive controls produce is a psychological change, an alteration in the character of the people.”  If this occurs as a result of interventions, then the society has begun moving down the road to serfdom.  If no psychological change has occurred (which can take up to two generations according to Hayek), then there is no presumption that a society will head down the road to serfdom.

Reflections on Friedman

It goes without saying that the world has lost a great economist and policy analyst.  Like many others, my education as an economist basically began with Friedman.  As an undergraduate, Saul Hoffman gave me his copy of Friedman's Price Theory.  I studied its chapters and spend much time solving the questions (although some continue to plague me).  In addition, I read a substantial portion of Friedman's Monetary History of the US in a course on the Great Depression which provided my framework for thinking about evaluating empirical questions.  Friedman's more well known books, such as Capitalism and Freedom and Free to Choose, have not had as much influence on me probably because I read a lot of Hayek while reading Friedman's technical writings as an undergraduate.  Without his writings, who knows if I would have continued to study economics.