Saturday, June 09, 2007

First Session Before HES

From the ‘Summer Institute for the Preservation of the Study of the History of Economics’, Thursday 7 June, George Mason University.

I arrived safely, though I missed the justly prestigious Professor James Buchanan’s session due to my misunderstanding the walking distance to GMU from the hotel.

Anyway I caught the three other papers, of which I shall speak of Alain Marciano’s (University of Reims) on ‘Buchanan’s Constitutional Economics’, which was extremely enlightening to me because the authors’ work he quoted (Buchanan and Tulloch, and Downs,) I had read as an undergraduate in the 60s and I had, apparently, not read them closely enough. Their books are on my shelves still, classified in my mind as ‘interesting’ applications of economics to the democratic version of politics (a.k.a., ‘disciplinary imperialism’).

They should have been read more closely but it was extra-curriculum reading (of which I did too much), because Buchanan had distinguishing ideas of great relevance to my present interests. He had developed an economics of politics that classed politics as ‘collective exchange’, in parallel to his focus on economics as individual exchange. His views were different from Lord Lionel Robbins’ assertion that economics was about ‘scarcity’, a notion I have never been happy with.

Buchanan declared bravely that he ‘treated Lord Robbins as an adversary’. ‘Scarcity’ provoked ‘choice among scarce means and infinite ends’, etc., which dominated economics textbooks from the 1930s. In the early 60s, Buchanan submitted dissenting articles to the professional journals, which rejected them – giving hope to thousands of ‘rejected’ authors – he was awarded a Nobel Prize subsequently.

James Buchanan focussed on exchange, or ‘catallactics’ (after Mises). This set me off on another train of thought. Last year, I read Human Action by Mises and was struck by his ‘problematic’ focus on the outcome of bargaining, instead of considering the process by which bargains had made. Mises asserts that bargainers have conflicting interests and would be driven by ‘selfishness’. But bargaining is not a zero sum game because the bargainers must mediate their differences otherwise they would not get a deal, as Smith shows in Wealth Of Nations (‘trade that which is cheap to give for that which is worth more to you’, and the conditional proposition: ‘give me this what I want and I shall give you that what you want’).

I enjoyed Alain Marciano’s case and thank goodness he spoke to his paper and didn’t read it word-for-word as some scholars did at Columbia University last August (see archives). With James Buchanan sitting in the audience, it must have put pressure on him, but it was fine session and I learned a lot from it.

Today we move on to the History of Economics Society conference (same venue, larger audience of participants).


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