Monday , May 17 2021
Home / David Henderson /Hayek on High Prices for 10 Seconds of Work

Hayek on High Prices for 10 Seconds of Work

Summary:
Even economists who regard themselves as definitely immune to the crude materialist fallacies [i.e., thinking in terms of material wealth] constantly commit the same mistake where activities directed toward the acquisition of such practical knowledge are concerned—apparently because in their scheme of things all such knowledge is supposed to be “given.” This is from Friedrich Hayek, “The Use of Knowledge in Society,” American Economic Review, September 1945. I thought of this passage today when I took my iPhone to an independent repair shop. I pointed out to the guy, Steve, that the usual plug into my iPhone didn’t fit. I speculated that it was because the one in my car had left a little piece in there and showed him the cord from my car, which looked as if it had

Topics:
David Henderson considers the following as important: , ,

This could be interesting, too:

David Henderson writes Economic Lessons from COVID-19

David Henderson writes Andy Pasztor on Our Amazing Airplane Safety Record

Scott Sumner writes Information, behavior, and frictions (short course on economics)

David Henderson writes People Have Purposes; Markets Don’t

Hayek on High Prices for 10 Seconds of Work

Even economists who regard themselves as definitely immune to the crude materialist fallacies [i.e., thinking in terms of material wealth] constantly commit the same mistake where activities directed toward the acquisition of such practical knowledge are concerned—apparently because in their scheme of things all such knowledge is supposed to be “given.”

This is from Friedrich Hayek, “The Use of Knowledge in Society,” American Economic Review, September 1945.

I thought of this passage today when I took my iPhone to an independent repair shop. I pointed out to the guy, Steve, that the usual plug into my iPhone didn’t fit. I speculated that it was because the one in my car had left a little piece in there and showed him the cord from my car, which looked as if it had lost a piece.

Steve told me it’s because I bought a low-quality cord. He got a little tool and took all of 10 seconds to pull a little piece out of the phone and Voila, the normal cord fit. So I bought a new 6-foot cord from him for $15. He said it was higher quality and it looked it.

“How much do I owe you for fixing the phone?” I asked.

“Twenty dollars,” he replied, and then quickly, “That’s the charge for my experience and wisdom.”

“Sounds right to me,” I answered and handed him my MasterCard.

David Henderson
David R. Henderson (born November 21, 1950) is a Canadian-born American economist and author who moved to the United States in 1972 and became a U.S. citizen in 1986, serving on President Ronald Reagan's Council of Economic Advisers from 1982 to 1984.[1] A research fellow at Stanford University's Hoover Institution[2] since 1990, he took a teaching position with the Naval Postgraduate School in Monterey, California in 1984, and is now a full professor of economics.[3]

Leave a Reply

Your email address will not be published. Required fields are marked *