Economics Quotes

Let us assume that a man gets half his income in the form of interest-bearing securities and half in the form of money; and that he is in the habit of saving three-quarters of his income, and does this by retaining the securities and using that half of his income which he receives in cash in equal parts for paying for current consumption and for the purchase of further securities. Now let us assume that a variation in the composition of his income occurs, so that he receives three-quarters of it in cash and only one-quarter in securities. From now on this man will use two-thirds of his cash receipts for the purchase of interest-bearing securities. If the price of the securities rises or, which is the same thing, if their rate of interest falls, then in either case he will be less willing to buy and will reduce the sum of money that he would otherwise have employed for their purchase; he is likely to find that the advantage of a slightly increased reserve exceeds that which could be obtained from the acquisition of the securities. In the second case he will doubtless be inclined to pay a higher price, or more correctly, to purchase a greater quantity at the higher price, than in the first case. But he will certainly not be prepared to pay double as much for a unit of securities in the second case as in the first case.

~ Ludwig Von Mises

If we compare two static economic systems, which differ in no way from one another except that in one there is twice as much money as in the other, it appears that the purchasing power of the monetary unit in the one system must be equal to half that of the monetary unit in the other. Nevertheless, we may not conclude from this that a doubling of the quantity of money must lead to a halving of the purchasing power of the monetary unit; for every variation in the quantity of money introduces a dynamic factor into the static economic system. The new position of static equilibrium that is established when the effects of the fluctuations thus set in motion are completed cannot be the same as that which existed before the introduction of the additional quantity of money. Consequently, in the new state of equilibrium the conditions of demand for money, given a certain exchange-value of the monetary unit, will also be different. If the purchasing power of each unit of the doubled quantity of money were halved, the unit would not have the same significance for each individual under the new conditions as it had in the static system before the increase in the quantity of money.

~ Ludwig Von Mises

The role played by man in production always consists solely in combining his personal forces with the forces of Nature in such a way that the cooperation leads to some particular desired arrangement of material. No human act of production amounts to more than altering the position of things in space and leaving the rest to Nature.

~ Ludwig Von Mises

The phenomenon of money presupposes an economic order in which production is based on division of labour and in which private property consists not only in goods of the first order (consumption goods), but also in goods of higher orders (production goods). In such a society, there is no systematic centralized control of production, for this is inconceivable without centralized disposal over the means of production.

~ Ludwig Von Mises

Fiscal considerations have led to the promulgation of a theory that attributes to the minting authority the right to regulate the purchasing power of the coinage as it thinks fit. For just as long as the minting of coins has been a government function, governments have tried to fix the weight and content of the coins as they wished. Philip VI of France expressly claimed the right to mint such money and give it such currency and at such rate as we desire and seems good to us and all medieval rulers thought and did as he in this matter. Obliging jurists supported them by attempts to discover a philosophical basis for the divine right of kings to debase the coinage and to prove that the true value of the coins was that assigned to them by the ruler of the country.

~ Ludwig Von Mises

The function of money is to facilitate the business of the market by acting as a common medium of exchange.

~ Ludwig Von Mises

One who criticises capitalism while approving of immigration, of which the working class is its first victim, would do better to remain silent. One who criticises immigration while remaining silent regarding capitalism should do the same.

~ Alain De Benoist

This is the fly in the ointment of free-market capitalism. It cannot ensure that profits are gained in a fair way, or distributed in a fair manner. On the contrary, the craving to increase profits and production blinds people to anything that might stand in the way.

~ Yuval Noah Harari

What economists and political scientists today call the “rational choice of individuals,” but what Smith called “the individual pursuit of happiness,” leads according to this view in a mechanical way to general welfare. As Alexander Pope in his Essay on Man put it: “true Self Love and Social are the same.” While this is the foundation of liberal capitalism, Marx’s dialectical materialism is not different in its selection of the economy as the prime mover. In this way the economy becomes the most important purpose of society. Fortunately, the economy has laws of causation, or, at least, that is what economists would like us to believe. Statistics are gathered to provide an objectified view of reality that enables social engineering. The individual and the collective are simultaneously put in an economic framework that is secular not in the sense that it is nonreligious, since individuals can rationally pursue religious ends, but in the sense that a God-given order of society has been replaced by an order that is constantly produced by homo economicus” (p. 41).

~ Peter Van Der Veer

The communists may not have done very well in the end, but I can't help thinking of capitalism as merely the go-to religion of the greedy and selfish.

~ Pansy Schneider-Horst

We give more economic aid to multinational corporations to increase their profits than we do to all the countries in the world combined.

~ Michael Hogan

The free enterprise concept inherent in the economic model of capitalism should mean common people, or lower and middle class wage-earners, have greater potential to rise up and gain financial independence. In reality, however, free enterprise all too often leads to an almost total lack of government regulation that in turn allows the global elite to run amuck in Gordon Gecko-style financial coups.

~ James Morcan

For the same reason a disease cannot be cured by more of the germ that caused it, the inflation and debt accumulation of the Obama years will not inflate our way out of it.

~ Ron Paul

Veblen called it the price-system. Mills called it the Power Elite. It's probably no more than ninety-nine people who don't know what they are doing. They're involved in high finance. Fascinating form of gambling.

~ John Cage

Do you understand economics? I mean big-time, prewar, global capitalism. Do you get how it worked? I don't, and anyone who says they do is full of shit.

~ Max Brooks

It's true that private enterprise is extremely flexible, But its only good within very narrow limits. If private enterprise isn't held in an iron grip it gives birth to people who are no better than beasts, those stock-exchange people with greedy appetites beyond restraint.

~ Aleksandr Solzhenitsyn

The lesson I have to teach is this: Leave all creative energies uninhibited. Merely organize society to act in harmony with this lesson. Let society's legal apparatus remove all obstacles the best it can. Permit these creative know-hows freely to flow. Have faith that free men and women will respond to the Invisible Hand. This faith will be confirmed. I, Pencil, seemingly simple though I am, offer the miracle of my creation as testimony that this is a practical faith, as practical as the sun, the rain, a cedar tree, the good earth.

~ Leonard Edward Read

In neo-classical economic theory, it is claimed without evidence that people are basically self-seeking, that they want above all the satisfaction of their material desires: what economists call maximising utility. The ultimate objective of mankind is economic growth, and that is maximized only through raw, and lightly regulated, competition. If the rewards of this system are spread unevenly, that is a necessary price. Others on the planet are to be regarded as either customers, competitors or factors of production. Effects upon the planet itself are mere externalities to the model, with no reckoning of the cost - at least for now. Nowhere in this analysis appears factors such as human cooperation, love, trust, compassion or hatred, curiosity or beauty. Nowhere appears the concept of meaning. What cannot be measured is ignored. But the trouble is that once our basic needs for shelter and food have been met, these factors may be the most important of all.

~ Carne Ross

Seen from that future time, when every commodity the human mind could imagine would flow from the industrial horn of plenty in dizzy abundance, this would seem a scanty, shoddy, cramped moment indeed, choked with shadows, redeemed only by what it caused to be created.Seen from plenty, now would be hard to imagine. It would seem not quite real, an absurd time when, for no apparent reason, human beings went without things easily within the power of humanity to supply and lives did not flower as it was obvious they could.

~ Francis Spufford

Now, quite apart from the fact that, from the point of view of the Earther, socialism suffers the devastating liability of only exhibiting internal contradictions when you are trying to use it as an adjunct to your own stupidity (unlike capitalism, which again, from the point of view of the Earther, happily has them built in from the start), it is the case that because Free Enterprise got there first and set up the house rules, it will always stay at least one kick ahead of its rivals.

~ Iain M. Banks

[A] great embarrassing fact… haunts all attempts to represent the market as the highest form of human freedom: that historically, impersonal, commercial markets originate in theft.

~ David Graeber

The ideas of economists and political philosophers, both when they are right and when they are wrong are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually slaves of some defunct economist.

~ John Maynard Keynes

The world is better served by syncretic economists and policymakers who can hold multiple ideas in their heads than by ‘one-handed’ economists who promote one big idea regardless of context.

~ Dani Rodrik

Some places will, however, be left behind. Not every city will succeed, because not every city has been adept at adapting to the age of information, in which ideas are the ultimate creator of wealth.

~ Edward Glaeser

There is one and only one social responsibility of business–to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud

~ Milton Friedman

Suppose that we believe that in 200 years, people would be prepared to pay a million dollars (that's in today's dollars, not inflated ones) to be able to have an unspoilt valley. Now imagine that today we can profit by cutting down the forest in the valley, which will never regrow. If we apply an annual discount rate of 5 percent, compounded exponentially, how big would that profit have to be to justify the loss of a million dollars in 2210? The answer, surprisingly, is just sixty dollars! That's all that a million dollars in 200 years is worth, at that rate of discount. Obviously, then, if we use a 5 percent discount rate, values gained one thousand years in the future scarcely count at all. This is not because of any uncertainty about whether there will be human beings or other sentient creatures inhabiting this planet at that time, but merely because of the compounding effect of the rate of return on money invested now.

~ Peter Singer

Markets cannot meet the needs of the very poor. The desperately poor are not consumers who will create an immediate profit.

~ Jeffrey D. Sachs

Socialism is politicized envy.

~ Rousas John Rushdoony

Consider the recent financial crisis and its link to faulty reward systems. President Bill Clinton's objective of increasing homeownership by rewarding potential home buyers and lenders is one example. The Clinton administration went to ridiculous lengths to increase homeownership in the United State, promoting paper-thin down payments and pushing lenders to give mortgage loans to unqualified buyers according to Business Week editor Peter Coy.

~ Max H. Bazerman

The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money.Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.This was the Captain Samuel Vimes 'Boots' theory of socioeconomic unfairness.

~ Terry Pratchett

It has been more profitable for us to bind together in the wrong direction than to be alone in the right one. Those who have followed the assertive idiot rather than the introspective wise person have passed us some of their genes. This is apparent from a social pathology: psychopaths rally followers.

~ Nassim Nicholas Taleb

If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has.

~ John Maynard Keynes

One of the Great Rules of Economics According to John GreenIf you are rich, you have to be an idiot not to stay rich. And if you are poor, you have to be really smart to get rich.

~ John Green

We have always known that heedless self interest was bad morals, we now know that it is bad economics.

~ Franklin D. Roosevelt

Once you realize that trickle-down economics does not work, you will see the excessive tax cuts for the rich as what they are -- a simple upward redistribution of income, rather than a way to make all of us richer, as we were told.

~ Ha-Joon Chang

It is true that the virtues which are less esteemed and practiced now--independence, self-reliance, and the willingness to bear risks, the readiness to back one's own conviction against a majority, and the willingness to voluntary cooperation with one's neighbors--are essentially those on which the of an individualist society rests. Collectivism has nothing to put in their place, and in so far as it already has destroyed then it has left a void filled by nothing but the demand for obedience and the compulsion of the individual to what is collectively decided to be good.

~ Friedrich A. Hayek

Under capitalism the common man enjoys amenities which in ages gone by were unknown and therefore inaccessible even to the richest people. But, of course, these motorcars, television sets and refrigerators do not make a man happy. In the instant in which he acquires them, he may feel happier than he did before. But as soon as some of his wishes are satisfied, new wishes spring up. Such is human nature.

~ Ludwig Von Mises

Freedom to order our own conduct in the sphere where material circumstances force a choice upon us, and responsibility for the arrangement of our own life according to our own conscience, is the air in which alone moral sense grows and in which moral values are daily recreated in the free decision of the individual. Responsibility, not to a superior, but to one's own conscience, the awareness of a duty not exacted by compulsion, the necessity to decide which of the things one values are to be sacrificed to others, and to bear the consequences of one's own decision, are the very essence of any morals which deserve the name.

~ Friedrich A. Hayek

If you hear a prominent economist using the word 'equilibrium,' or 'normal distribution,' do not argue with him; just ignore him, or try to put a rat down his shirt.

~ Nassim Nicholas Taleb

Geniuses and prophets do not usually excel in professional learning, and their originality, if any, is often due precisely to the fact that they do not.

~ Joseph Alois Schumpeter