Skousen The Big Three in Economics - Smith, Marx, Keynes (Sharpe, 2007)

238 INDEX

Production (continued) factors of, 118

key to wealth, 9

linked to distribution, 109 for profits and use, 106 roundabout, 112, 131 stages of, 10, 131

Production of Commodities by Means of Commodities (Sraffa), 55

Profit rate and value problem, 92–93 Profits

falling, 85–86

price-cost margins and, 109 production for, 106

use and, 109

Property, private. See Private property Prosperity

economic freedom and, 31 keys to, 10–11, 18

Protestant Ethic and the Spirit of

Capitalism (Weber), 123

Protestant Reformation, 123, 124 Protestants, 39

Public-choice theory, 209–210

Public Finance in Theory and Practice

(Musgrave), 209 Public works, 160–162

Purchasing Power of Money (Fisher), 126

Quantity Theory of Money, 126–127 Quantity theory of money. See Money,

quantity theory of Quesnay, François, 41–42

Radical journals and organizations, 101–102 Rational expectations, 198

Read, Leonard, 10n2, 26 Real balance effect, 178 Recession

1970s, 186–189, 198

Keynesian solutions to, 159–160, 172–173 Say’s explanation for, 185–186

Reflections on the Formation and Distribution of Wealth (Turgot), 43

Religious beliefs Hume, 24–25, 44 Marx, 69–70, 71, 89 Smith, 24–25, 44 Weber, 123, 124

See also God

Religious freedom, church attendance and, 24n9

Revolutionary socialism. See Socialism

Ricardian vice, 54, 55 Ricardo, David, 54–56 dismal science, 50, 51, 63 distribution, 57–59 Marx and, 83–84

Say on, 48

value in labor, 59–60 Risk level, 111 Robinson, Joan, 135, 215 Rostow, W.W., 201, 204 Rothbard, Murray, 42, 192 Rothschild, Emma, 22–23 Roundaboutness, 112, 131

Samuelson, Paul A., 164 AS-AD diagram, 188 on Capital, 93 criticism of, 169–170

Economics, 165–166, 169, 170 goals of, 171

honors and awards, 166, 168, 169 on Keynes’ General Theory, 146, 153 Keynesian cross, 171–172, 186

life of, 166–167

macro policy dilemma, 187 on Marx, 69

on Marxist economics, 94 mathematical equations, 55, 168 on national debt, 176–177

on new global economy, 208 paradox of thrift, 173–174, 208 postwar predictions, 168 revised theories, 208

on Smith, 12, 174 on socialism, 201

Saving American Capitalism (Harris), 164 Savings

antisaving proponents, 157–158 Böhm-Bawerk’s view of, 112, 180 economic growth and, 179 Hayek on, 158

Keynes’ view of, 155–157 Mankiw’s view of, 207 multiplier, 180

positive side of, 180 Protestantism and, 124

Samuelson’s view of, 171–175, 208 Say’s view of, 49

See also Interest; Investment; Thrift Say, Jean-Baptiste, 47–48

Say’s Law, 48–49, 86, 92 inverse of, 159 Keynes and, 184–186

Say’s Law and the Keynesian Revolution

(Kates), 184–185 Schor, Juliet, 97–98

Schumpeter, Joseph, 60, 101, 200 Schwartz, Anna J., 193 Schweickart, David, 102 Self-interest

meaning of, 27 sympathy vs., 29–30

wealth and prosperity through, 18, 19 See also Invisible hand Self-restraint, 28

Selfishness, 29

Senior, Nassau William, 28n10 Shakespeare, 22–23 Sham-lecture, 13–14

Shaw, G.K., 189

Silver, 8, 9, 36

Skulls, reading of, 77–78 Smith, Adam

advocate for the common man, 6–7 burning of manuscripts & papers, 17 burns clothes, 16

customs agent, 16–17 death of, 18

economic freedom, 10–11 on Fable of the Bees, 40 famous remark, 38

on government, 34–36 hypotheses, 31–32

invisible hand. See Invisible hand Keynes’ critique of, 149

life of, 12–18

Marx contrasted to, 64–65 natural liberty, 7, 10–11 optimist, 37–38

religious beliefs, 24–25, 44 sham-lecture, 13–14

shift back to, 205–206, 216 sympathy vs. self-interest, 29–30 totem pole position, x, xif universal opulence, 6, 7, 10–11, 32 view of greed and selfishness, 29 view of trade, 8

Wealth of Nations. See Wealth of Nations

Smith, Vernon L., 215 Smugglers, 16

Social Justice Without Socialism (Clark), 119 Social Security, 207

Socialism, 60–61, 200 critics of, 203 Heilbroner on, 202–203 Marx and, 88–89, 95

INDEX 239

Socialism (continued)

Mill and, 62–63 post WWII, 200–202 Sweezy and, 101

Solow growth model, 207 Somary, Felix, 142

Soviet Union, collapse of, 199, 202 Spanish scholastics, 39, 124 Specie-flow mechanism, 44, 131 Spending, Keynes’ on, 158–161 Spirit of the Laws (Montesquieu), 40 Sraffa, Piero, 54, 55

Stabilization policy, 208

Stages of Economic Growth (Rostow), 201 Stages-of-production, 10

Stagflation, 198 Stagnation thesis, 167–168 Standard of living capitalism and, 32–34

economic freedom and, 31–32 Stigler, George, 14n4, 20 Stiglitz, Joseph, 214–215 Stock market

crash of 1929, 127 Keynes and, 142–144, 155 transfer tax, 162

Suicide

of Marx’s daughters, 83 Marx’s fascination with, 73 Supply, 48–49

aggregate, 153, 154f, 188–189 demand creates, 159

price determined by, 59 Surplus value, 84–85, 110

Sweezy, Paul M., 91, 100–101, 135 Sympathy, self-interest vs., 29–30 System of natural liberty. See Natural

liberty

Tableau économique, 41–42 Tariffs, Smith’s view of, 8 Tarshis, Lorie, 175

Tax cuts, Keynesian view of, 172 Taxation

land, 119–120 Samuelson’s view of, 176 Smith’s view of, 35

Teaching of Marx for Girls and Boys

(Brown), 67

Theology, liberation, 102–104

Theology of Liberation (Gutiérrez), 103 Theory of Money and Credit (Mises),

129–130

240 INDEX

Theory of Monopolistic Competition

(Chamberlin), 134

Theory of Moral Sentiments (Smith) God, 23, 25, 44

government, 35–36 invisible hand, 21–22, 23 sympathy, 29–30

year published, 14

Theory of Political Economy (Jevons), 107 Theory of surplus value, 84–85, 110

TheoryoftheLeisureClass(Veblen),121,122 Thrift, 11, 36

anti-thrift proponents, 157–158 Böhm-Bawerk’s view of, 112 Keynes’ view of, 156–157 paradox of, 173–174, 179, 208 Protestantism and, 124

Say’s view of, 49

See also Savings

Tobin, James, 26, 162n11, 193 Tocqueville, Alexis de, 47 Totem pole, x–xi

Townsend, Charles, 15

Tract on Monetary Reform (Keynes), 142 Trade

Bastiat’s view of, 47 Hume’s view of, 44 mercantilist restraint of, 8 Smith’s view of, 8–9, 16 Transfer tax, 162 Transformation problem, 92–93 Traveling abroad, youth, 14n4

Treatise on Money (Keynes), 143, 156

Treatise on Political Economy (Say), 47, 48 Tullock, Gordon, 210

Turgot, Jacques, 43

Twilight of Capitalism (Harrington), 90

Underconsumptionists, 157–158 Unemployment

inflation and, 187, 198 involuntary, 185, 215 Mankiw’s view of, 207 natural rate of, 197 wage cuts and, 178 war and, 163–164

Unemployment equilibrium, 153 Union of Radical Political Economics,

101–102

Unions. See Labor unions

United Kingdom, rise in income, 5f United States

standard of living, 33, 33f

United States (continued)

stock market crash of 1929, 127 Universal opulence, 6, 7, 10–11, 32 Universities, economics departments, 113 URPE. See Union of Radical Political

Economics

Utility, marginal. See Marginal utility

Value

cost-of-production theory, 59, 106, 108

labor theory, 54, 59–60, 83–84, 92 marginal principle of, 108–109 paradox of, 108

surplus, 84–85, 110

in “use” vs. in “exchange,” 108 Variable capital, 84–85

Veblen, Thorstein, 121–123 Viner, Jacob, 23

Voltaire, 15

Wages

Böhm-Bawerk’s view of, 111 Clark’s view of, 118–119 cuts and unemployment, 178 Malthus’ view of, 54 Mankiw’s view of, 207

marginal productivity of labor and, 109

natural liberty and, 11 Ricardo’s view of, 57–59 Waiting argument, 110 Wallich, Henry C., 201

Walrus, Leon, 107–108, 115–116 War

employment and, 163–164 Keynes’ view of, 163 Smith’s view of, 35 Watershed years

1776, 4–6 1848, 60–61 1948, 164–165 1970s, 186–189 Wealth

earned, 109 keys to, 9–10, 18

measurement of, 9

Ricardo’s distribution of, 57–59

Wealth, Distribution of (Clark), 118, 119 Wealth of Nations (Smith)

editions, 15

greed and egoism, 27–28 invisible hand reference, 22

Wealth of Nations (Smith) (continued) objectives of writing, 7

sympathy vs. self-interest, 29–30 universal acclaim, 12

writing and publication of, 4–5, 15 See also Smith, Adam

Webb, Beatrice, 135, 200

Webb, Sidney, 135, 200

Weber, Max, 123–125

Welfare economics, 20–21, 115–116 Westphalen, Jenny von, 72, 73–74, 79 death of, 82

Wicksell, Knut, 107, 130

“Woolen coat” example (Smith), 10, 19

Wordsworth, William, 46, 168

INDEX 241

Worker-capitalist phenomenon, 93–94 See also Capitalists

Worker exploitation, 85, 86 Worker revolts, 76

World Bank, 199, 201, 204 World War II, 163, 211 socialism after, 200–203

Worldly Philosophers (Heilbroner), 202

Yeager, Leland, 189

Youth

education, 89

traveling abroad, 14n4

Yunus, Muhammad, 204–205

Zeus, 78

About the Author

Mark Skousen is a professional economist, investment expert, university professor, and author of over twenty books. Currently he holds the Benjamin Franklin Chair of Management at Grantham University. In 2004–05, he taught economics and finance at Columbia Business School and Columbia University, and from 1986 to 2003, at Rollins College in Florida. Since 1980, Skousen has been editor in chief of Forecasts & Strategies, a popular award-winning investment newsletter. He is also chairman of Investment U, one of the largest investment e-letters in the country, with 300,000 subscribers. He is a former analyst for the CIA, a columnist to Forbes magazine, and past president of the Foundation for Economic Education (FEE) in New York. He has written for the Wall Street Journal, Forbes, and Reason magazine, and has appeared on CNBC, CNN, ABC News, Fox News, and C-SPAN Book TV. His bestsellers include The Making of Modern Economics and The Power of Economic Thinking. In 2006, he compiled and edited The Compleated Autobiography, by Benjamin Franklin. In honor of his work in economics, finance and management, Grantham University renamed its business school “The Mark Skousen School of Business.”

Websites: www.markskousen.com; www.mskousen.com

Email address: [e-mail]

243