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Peter Boettke

Peter Boettke

Peter Joseph Boettke (January 3, 1960) is an American economist of the Austrian School. He is currently a University Professor of Economics and Philosophy at George Mason University; the BB&T Professor for the Study of Capitalism, Vice President for Research, and Director of the F.A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics at the Mercatus Center at GMU.

Articles by Peter Boettke

Five Books: The Butcher’s Bill of the Soviet Experience

24 days ago

Communism kills. 100 million lost souls in the 20th century, not from war or natural causes, but from state execution.  Let that sink in – 100 MILLION.

OK, now back to scholarly recommendations for books to learn about and understand this experience.  Obviously, the classic work in this regard is Aleksandr Solzhenitsyn’s The Gulag Archipelago (originally published in 1973). The impact of this work cannot be overstated. And, it should be read by every student of civilization in the 20th century.
In addition to the official prison system that the Soviet system utilized for repression, there existed the day-to-day repression of everyday life and social interaction outside of the prison walls. But it was still a prison culture of the mind.  The best book I know of

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Kari Polanyi on her father Karl Polanyi

28 days ago

As you might expect, when it comes to the Polanyi brothers, my intellectual tastes align more with Michael than with Karl.  But, since my return to teaching Economic Sociology to graduate students, I have studied Karl Polanyi’s work and its lasting impact in the field.  To be honest, I do not find Karl Polanyi that impressive either analytically or observationally. But the reality is that The Great Transformation had an oversized influence and continues to do so, and thus I need to listen more carefully to why others are so moved by a work that I find to be so pedestrian in terms of economic theory, historical scholarship, and political economy implications.
Upon reading a first draft of chapters of what would become Hayek’s The Fatal Conceit, I often said that Hayek had provided

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Five (More) Books: Revisionist Accounts of the Soviet Experience

29 days ago

In my previous posts, I offered recommendations for reading on the Russian Revolution and the Soviet economy, and the Ethnography of Soviet life.

As you can glean from my recommendations for reading so far, I have stressed learning about the dysfunctions and dystopian aspects of the system.  I will come back to that in my final post in this series. But right now I do think it is valuable to also acknowledge alternative perspectives.
During the 1970s, a “revisionist school” of historians rose to challenge the standard “Cold War” totalitarian system narrative. They provided counter evidence to say either that they system was more decentralized and democratic than the totalitarian model suggested, or that it was less repressive than the totalitarian model claimed; or

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The Problem of Policing and Local Public Economics

June 3, 2020

Back in the 1980s, I got interested in the work of Lin and Vincent Ostrom as it pertained to the disjoint between how different economic and political systems were supposed to operate (de jure) and how they actually operated (de facto) and the institutions that emerged to govern the actually practices.  It was my interest in the Soviet experience that first alerted me to this … one of my main professors in graduate school was Michael Alexeev, and along with Gregory Grossman and Vladimir Treml, Mike was also involved with research on the Soviet black-market economy.  So with his guidance I studied everything I could on that subject, and that led me to thinking about this disjoint between de facto and de jure rules.  From that moment, I saw how in the Austrian literature they also

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Five (More) Books: Economic, Political and Social Ethnography of Soviet Life

June 3, 2020

In my previous two posts, I offered recommendations for reading on the Russian Revolution and the Soviet economy. Today, I’d like to turn our attention everyday life in the Soviet Union.
My most cherished comment on one of my books dealing with the Soviet system was from then Department Chair of Economics at Moscow State University, who upon reading my discussion of the contrast between how the system was supposed to work and how it really worked wrote to me to tell me that my description fit perfectly with the daily life that he and his family had to endure.  I had done my job then.  I think the purpose of economic theory is to aid us in our task of making sense of the political economy of everyday life.  Not theorems and graphs on blackboards and textbooks, but

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Five Books on the Soviet Economy

May 30, 2020

In my previous post, I listed the first five of my twenty-five recommended books on the Soviet experience. That list focused specifically on the Russian Revolution. Today, my selections explore the Soviet economy.

The Soviet Economy
The classic account of Soviet economic history is found in Alec Nove’s An Economic History of the USSR (originally published in 1969).  It is almost impossible to imagine embarking on a study of the Soviet economy without beginning with Nove’s account.

Yet, when I talk to my graduate students I often distinguish between “what” questions, and “why” questions.  My point to them is that the answer to “what happened” is just a critical first step; they must be able to answer “why what happened, happened.”  The “why nexus” is the domain

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Understanding Soviet Socialism: (Twenty) Five Books

May 28, 2020

I was challenged with listing 5 books to improve one’s understanding of the Russian Revolution and the Soviet experience.  I hesitated at first because that is such a big subject with such varying views, and while I have my own very strong priors, I didn’t think it was right to just list books that would reveal those. Though, of course, any listing would.
But then I saw my good friend Steve Horwitz “cheated” on the assignment he was tasked with and listed 10 books.  Never to be outdone by Steve (inside joke), I have decided to provide a list that has 5 books for each of 5 categories on the topic of the Russian Revolution and Soviet Socialism.  The 5 categories will be (1) The Russian Revolution; (2) The Soviet Economy; (3) Economic, Political and Social Ethnography

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Expert Failure in Times of Crisis

May 19, 2020

I have tried to use this time to stay focused on research, writing and teaching.  But, as imagine is common, my attention has been drawn to current affairs and learning how to operate in a virtual classroom while attempting to be an engaging and effective educator.  That doesn’t mean my normal interests have taken a backseat, it just means my juggling of my time and attention has required a different focus than was the case prior to March 2020.
This juggling, as well as my intellectual interests, have led me to "attend" multiple webinars.  I consistently join the webinar at Princeton on Monday and Fridays on the economic and political economy of COVID-19 — talks, e.g., by Cowen, Deaton, Kremer, Stiglitz, Acemoglu, Rodrik, Krugman, and this week Cochrane, and upcoming Summers.  I

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Why Doesn’t the Fifth Amendment Apply?

May 6, 2020

The Fifth Amendment reads:

No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

The takings clause may provide the guiding principle.  Shutting down the economy to address a public health crisis could be interpreted as a taking for public use, and if

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Actions prejudicial to the interests of others …

April 29, 2020

In J. S. Mill’s On Liberty (1859), chapter 5 "Applications", he argues:

The principles asserted in these pages must be more generally admitted as the basis for discussion of details, before a consistent application of them to all the various departments of government and morals can be attempted with any prospect of advantage. The few observations I propose to make on questions of detail, are designed to illustrate the principles, rather than to follow them out to their consequences. I offer, not so much applications, as specimens of application; which may serve to bring into greater clearness the meaning and limits of the two maxims which together form the entire doctrine of this Essay, and to assist the judgment in holding the balance between them, in the cases where it appears

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‘Emergencies’ have always been the pretext …”

April 28, 2020

Note the scare quotes Hayek uses!  The full quote reads: "’Emergencies’ have always been the pretext on which the safeguards of individual liberty have been eroded — and once they are suspended it is not difficult for anyone who has assumed such emergency powers to see to it that the emergency persists." (Hayek, Law, Legislation and Liberty, Vol. 3, 1979, 124, emphasis added).  
I added the emphasis, just as I am stressing the scare quotes, for a simple reason — in my reading of the history of political economy that are two glaring errors that are committed — Romance on the one hand, and Cynicism on the other.  Romance lead us astray by framing political leaders as saintly geniuses, whereas Cynicism leads us astray by framing the system as completely corrupt and devoid of any

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Some GMU History, Karen Vaughn, and Smith/Schumpeter/Stupidity Once More

April 17, 2020

Here is my version of a postcard from the edge to provide links to potentially interesting conversations to join during these tumultuous times.
Prior to the breakout, I was able to do two podcasts with the GMU Econ Society. Part 1 and Part 2.
2020 is the 40th anniversary of Mercatus Center, and as part of celebration I had the opportunity to sit down with one of the pivotal players in the history of the Center — Professor Karen Vaughn.  This conversation is focused on her scholarly career.  During her visit, Professor Vaughn also had the opportunity to talk with my colleague Dr. Jayme Lemke on the being a woman in the economics profession.
Finally, I published some reflections on the use of colorful examples in the teaching of economics with the hope of placing some emphasis on

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Coordination Problems in a Post Pandemic World

April 5, 2020

A mantra we have used on this site since changing our name a decade ago is that we study economics as a coordination problem, and we see entrepreneurship as the solution to that problem.  In various works the different authors on this blog have pursued and reported on here, they have studied entrepreneurship in the public, private and independent sector to see how a variety of coordination problems are in fact solved or at least ameliorated.  These are never trivial acts ex ante but often acts of bold courage; of voyages into an unknown and uncertain world. But unless these acts are taken, the coordination problem persists and opportunities for gains from trade and gains from innovation are unrealized.  In short, absent the productive specialization and peaceful social cooperation

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The Modeling “Problem” in Economics

March 27, 2020

Consider the situation of a complex adaptive system with intricate moving parts, and the critical element in all of this has purposes and plans of its own. Welcome to the world of economics. As Carl Menger pointed out over a century ago, “… man, with his needs and his command of the means to satisfy them, is himself the point at which human economic life both begins and ends.” Principles of Economics (1871, 108) Friedrich Wieser in Social Economics (1927, 8-9) would stress this point about the social sciences versus the natural sciences in stark terms as follows:

The object of investigation is man in a condition of activity. Hence our mind ratifies every accurate description of the processes of his consciousness by the affirmative declaration that such is the case, and by the

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The Planner’s Problem and the Allocation of Essential Supplies During a Crisis

March 25, 2020

Before I start this post, let me suggest to everyone that you look at Chris Coyne’s Doing Bad By Doing Good (Stanford University Press, 2013) and any lectures you can find by Coyne on this subject on YouTube.  Also, for the purposes of this post, it also might be insightful to watch some episodes of the old TV series MASH and focus on the character of Radar O’Reilly, and how he worked behind the scenes throughout the Korean War to try to procure the needed medical supplies because the planning apparatus failed to do so in an efficient manner to meet the most urgent needs of the doctors and nurses in the field.  
Andrew Koppelman explains the basic argument that will be provided for planning in times of emergency, like war, natural disaster, pandemic.  My good colleague Alex Tabarrok

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Expectations, Historical Context, and Social Science

March 21, 2020

Like everyone, recent events has my mind racing.  What is going on?  Are my kids safe?  Family? Friends?  What just happened to my retirement account? But also my thinking races back to my parents and grandparents.
Take my grandparents. They had to live through WWI, the Great Depression, and WWII.  My grandfather came home from WWI, one of his brothers did not.  My grandparents — both sets — sent a son off to war in WWII but their son returned, their neighbors did not.
In addition to WWI, Great Depression and WWII, they had to deal with the flu in 1918 and 1957, and of course polio in 1949.
Why I bring all this up is I wonder about how these experiences (historical context) helps form expectations and mental models that human actors use in making their decisions concerning

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Ludwig von Mises on Economics During the Time of Crisis and Within an Interventionist State

March 20, 2020

Ludwig von Mises remains in my judgement the greatest economic analyst of the 20th century.  He was sharp and pointed, and yet comprehensive.  His critique of socialism was decisive and his price theoretic rending of the manipulation of money and credit remains I would argue the top contender for an economic theory of macroeconomic volatility.  There are other theories — psychological, random shocks, etc. — that can use economic tools in analyzing, but an economic explanation that traces from individual decision making guided by relative prices to the pattern of exchange, production and distribution, and how distortions in that chain can result in coordination failure, that still belongs in my humble opinion to the class of theories that Mises pioneered.  And, in developing both

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Getting at the Crux of the Matter as an Economist

March 19, 2020

In this piece by Pierre-Olivier Gourinchas, he states very clearly the reality constraint in public policy deliberations in the current crisis.  Without commenting one way or another, I think it could serve as a very useful point of departure for serious conversations about trade-offs, short-run/long-run, and public policy in a liberal society.

My sincere hope is that we will be able to deliberate our way to a consensus that will reduce regime uncertainty, and free up the creative powers of our civilization to both address our public health crisis and make sure the economic future is bright.  As I mentioned yesterday, Tyler Cowen has some ideas we might be able to build a consensus around.
When I wrote Why Perestroika Failed: The Politics and Economics of Socialist

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The Virginia School of Political Economy and Public Policy Even in Times of Crisis

March 18, 2020

I have been reading closely the new book by David Levy and Sandra Peart, Towards an Economics of Natural Equals: A Documentary History of the Early Virginia School (Cambridge, 2020).  I want to explain briefly what I mean by closely.  The hardback book just arrived at my home on Monday this week.  I have had the Kindle version for over a month, the page proofs over 3 months, and I read each and every chapter and documents as the book was being produced over the past several years.  To put it mildly I am already familiar with this book and have been extremely impressed by it since I read their original paper on the Ford Foundation and the Thomas Jefferson Center for Studies in Political Economy at UVA.  By , I mean every single word, every footnote, every suggested lead.  I am doing

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Going online — the experience

March 17, 2020

Two weeks ago I, along with all my colleagues at GMU, learned two things — moving classes online for a few weeks and restrictions of travel due to concerns over the Coronavirus.  Since that time, I have been learning how to move my class online and canceling upcoming professional and personal travel.  I have never taught online, so my learning curve is quite steep.  And to make issues worse, this term I am teaching what I take as a professional responsibility as one of the most important classes one can teach in a PhD program — Advanced Microeconomics.  We will muddle through, and with a use of mix between videos and readings, and discussion forums, as well as other assessment tools, hopefully the students in the class will learn their lessons in price theory well and be able to

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Manipulation and Deception in Society

February 21, 2020

Rosolino Candela and I have published a series of papers on the history of price theory since Alfred Marshall.  In these papers we distinguish between not only microeconomics and macroeconomics, but also within microeconomics those theories that could be dubbed price theoretic as opposed to those that are more appropriately labeled choice theoretic.  Furthermore, we distinguish between three different approaches found in the literature in response to thinkers that stress social problems (poverty, ignorance and squalor) and market failures (monopoly, externalities, public goods). Those responses can be summarized as:
Conceptual Clarity
    it is important to make sure folks are telling the story to the end and thus drawing the curves the right way and in the right place

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Happy 90th Birthday to Professor Israel M. Kirzner (February 13th 1930)

February 14, 2020

The greatest living scholar of the Austrian School of Economics, and its most accomplished practitioner in the contemporary era turned 90 yesterday.  His classic work Competition and Entrepreneurship has garnered over 10k in citations, and his JEL survey of contemporary Austrian economics has close to 5k.  Moreover, through his teaching and organizational efforts at NYU and beyond, he was personally responsible to carving out a scholarly place for the next generation of economists and political economists to work in developing the ideas of Menger, Bohm-Bawerk, Mises, and Hayek in their own unique way.
He was the advisor of my advisor — Don Lavoie — whose these Rivalry and Central Planning met with professional acclaim and had such a significant impact on my own career path.  I had

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Some Recent Papers That Might Be of Interest, as well as some essays

February 5, 2020

This will just be links to some of my recent papers that have been posted at SSRN and are slated for publication in a variety of outlets.

    1. The Positive Political Economy of Analytical Anarchism (with Rosolino Candela)
    2. They Never Walked Alone (with Alain Marciano and Solomon Stein)
    3. Where Chicago Meets London (with Rosolino Candela)
Last year, the Collected Works of Israel M. Kirzner was completed (10 volumes), and in the final version we provided a fully updated and comprehensive accounting of his publications.  This compilation built on earlier efforts by myself and others, but the final version was due to the effort and care of Rosolino Candela.  It warrants special attention in my mind for all students of Austrian economics, entrepreneurship, market

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The Beautiful Patterns of Nature

January 20, 2020

Watch this video and consider the beautiful patterns that are painted by nature.

[embedded content]
Now, consider the following passages from Alfred Marshall’s Principles of Economics, 8th edition (1920), 287-288.

Such an equilibrium is stable; that is, the price, if displaced a little from it, will tend to return, as a pendulum oscillates about its lowest point; and it will be found to be a characteristic of stable equilibria that in them the demand price is greater than the supply price for amounts just less than the equilibrium amount, and vice vera.  For when the demand price is greater than the supply price, the amount produced tends to increase. Therefore, if the demand price is greater than the supply price for amounts just less than an equilibrium amount; then, if the

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G. L. S. Shackle on Alan Coddington’s THEORIES OF THE BARGAINING PROCESS

January 13, 2020

This upcoming term I am teaching Microeconomics II, and in preparing for the class I have been revisiting so many ideas and concepts that I obsessed over with my good friend Dave Prychitko as we worked our way through the microeconomics sequence and our study of the theory of general competitive equilibrium.  We had a great teacher for Microeconomics II … Michael Alexeev … and while he demanded that we learn the technical material inside and out, he also encouraged Dave and I to explore different perspectives and the history of the debates/discussions, which we did in class, in directed readings, and in papers during our PhD studies.  Dave and I, a few years after our graduation from GMU, edited a 2 volume reference work that was made up of the various Market Process Theories we

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