CAFÉ course 2 – Comparative institutions of production and
distribution 2 - general outline
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Instructor: |
Peter Lewin |
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Semester Start/End
Date: |
Aug. 23 - Dec. 9 |
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Email: |
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Office: |
SM 3.223 |
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Web Site: |
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Office hours: |
by appointment |
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Course
Description: Economic history of civilization and history of
political-economic-business ideas as they impact production and distribution
systems. Related examination of the ideas and canonical texts in the
development of classical liberalism and its critics. Critical analysis of the
principles and methods of current mainstream economics in understanding the
business world. This
is a course that focuses on how the society “decides” what gets produced, who
produces it, who consumes it. It is particularly concerned with the workings
of markets and alternatives to markets. Student Learning
Objectives/Outcomes Understand
how markets work to provide consumers with products they want and to
discipline producers to keep their costs down. To equip students with an understanding of (the ability to analyze and explain) the
business world as it has developed since the Industrial Revolution – Its origins is the
classical liberal system of production and exchange and how it has changed. – The structure of the
current business environment, domestically and abroad. –
The effects of current economic policies on
business performance. Course
Format: The course will be a mixture of lectures and
discussion. Below in the Weekly Outline and the detailed Topics Outline. The topical
outline contains readings (online links), and questions for consideration.
Some weeks we will discuss applications of the principles covered in
lectures. We will discuss various applications as we go along. To begin a
student (to whom I will have allocated that application) will sum up the
issues involved. The discussion will then be open. As necessary I may insert
some lecture material to clarify issues. Course
Materials: Each
student has received a copy of Milton Friedman’s Capital and Freedom.
[read the short article here]. Students will also receive a copy of Socialism Sucks,
by Robert Lawson and Ben Powell. You
also have an electronic copy of Alchian and Allen’s University Economics.
Use this for revision of basic economic principles. We may refer to it from
time to time. Also very helpful will be: ·
Eamon Butler, An
Introduction to Capitalism, access (or
download) here (https://iea.org.uk/publications/an-introduction-to-capitalism). ·
Steven Horwitz, Austrian Economics:
An Introduction, download or purchase here.( https://www.libertarianism.org/books/austrian-economics-introduction) Capitalism
and Freedom provides an outline of the
essentials of the case for free-enterprise in general and for some
significant specific cases. It will also serve as a springboard for the
consideration of other works and specific cases. The Alchian and Allen text
will be very helpful as a reference for much of our discussion. I have also
provided a copy of Socialism Sucks for each student – a look at
contemporary socialism around the world Evaluation: Students will be evaluated on their
presentations for discussion of the applications, on two tests – a midterm
and a final, and a presentation in class that you turn in at the end of the
course. |
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List of possible
topics we will cover |
Week |
Date |
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1. History of thought
– the evolution of the mixed economy |
1 |
8/26/2021 |
Lecture |
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2. Regulation –
principles and practice |
2 |
9/2/2021 |
Lecture |
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a. Licensing |
3 |
9/9/2021 |
Lecture |
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b. Anti-trust |
4 |
9/16/2021 |
NO CLASS |
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c. FDA |
5 |
9/23/2021 |
Lecture |
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d. Monetary
Policy |
6 |
9/30/2021 |
Lecture |
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e. Monopoly |
7 |
10/7/2021 |
Lecture |
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8 |
10/14/2021 |
Midterm Test |
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Possible presentation
topics. |
9 |
10/21/2021 |
Presentations |
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1. Private versus public
education |
10 |
10/28/2021 |
Presentations |
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2. Discrimination |
11/4/2021 |
Presentations |
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3. Immigration |
11/11/2021 |
Presentations |
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4. The drug war |
11 |
11/18/2021 |
Presentations |
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5. Climate change |
12 |
11/25/2021 |
NO CLASS |
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6. Endangered species and exhaustible
resources |
13 |
12/2/2021 |
Presentations |
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7. Private versus public
charity |
14 |
12/9/2021 |
Final test |
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8. Public
versus private healthcare |
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9. Private
currency |
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10.Development aid (government
aid to developing countries) |
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11.America's criminal justice
system |
What we don’t cover in the presentation I will
cover. So for your presentation you can choose from the list anything not
covered in the lectures (or any other that you would like to with my approval).
Final draft of
presentation - due 12/13 by midnight or before
Topical
reading
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Topics and basic reading |
Additional Reading |
Issues |
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General Topics 1.
Scarcity, Choice,
Exchange, invisible hand, budget constraints, opportunity cost, production
possibility frontier; The big picture—Why are we no longer hunters and
gatherers? capitalism versus other
systems; What makes countries rich? Friedman Chap 1.; scarcity of parking link ; Wikipedia article on an American utopia community link ; list of American utopian communities link ; Alternatives to markets: Alchian Alternatives to private property:
Communes, kibbutz’s, collectives; Powell’s article on Plymouth link ; Bradford’s actual journal: 162-163 link; Exchange/Trade, Specialization, comparative
advantage. |
Revision Advanced:
Carl Menger ch. III. Robert
Murphy on subjective value Bastiat: What
is seen and what is not seen David
Henderson on opportunity cost Hayek:
Economics and Knowledge – this link ch. 2 Tyler
Cowen explains this article Hayek:
The Use of Knowledge in Society – this link ch.4. Lewin: Hayekian Equilibrium and Change General: |
Recap of the development of political economy and the birth of economics.
How are they related? What is the significance of the Marginal revolution? Is
value objective? Schools of economic thought. |
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2.
Supply and
Demand, surplus and shortage, the meaning and role of price, price controls,
taxes, Elasticity, long run and short run, model of entry and exit, survival
of the fittest: “Minimum Wages were
first designed to keep women and minorities out of jobs,” Thomas Leonard,
April 5, 2016, Los Angeles Times link; “Davis-Bacon: Jim Crow's Last Stand” John Frantz, Foundation for
Economic Education link. Speculation; monopoly, competition, public goods; link. |
Revision – basic regulation and effects, static and dynamic. Ex. Price
controls, taxes and subsidies. |
The power of Marshallian economics for understanding the world. What are
its limitations? What are the alternatives? |
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3.
Market failures? Externalities:
Tragedy of the commons |
We will treat this as a new topic for this course. Externalities, public goods, market-failure,
economic policy. Alchain, Barzel. |
See below |
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Principles of regulation - Lewin
document, Principles of Regulation. |
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Economics of the environment. Air and water pollution,
Depletable resources, endangered species, climate change - Lewin class notes
and slides |
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Which of the usual suspects are/are not real
environmental problems? |
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Application: Immigration Application: The drug war |
Article by Ben Powell - immigration Interview with Friedman; article by Ben
Powell – the drug war |
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Application: Professional licensing- Friedman ch. 9 Application: The FDA |
WSJ articles |
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Application: Education – Friedman ch. 6 Application: Discrimination - Friedman ch. 7 |
Larry Elder – a public right gone wrong; John
Stossel – stupid in America Thomas Sowell. |
Is education a public good? |
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Introduction to Macroeconomic political economy
– AA ch 23, 25 -34 |
Lewin article - https://personal.utdallas.edu/~plewin/F&Opaper.pdf
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Monetary policy in historical context from A. Smith
to today, bitcoin and crypto currencies – part 1 – AA ch 23, 25 -34 |
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Monetary policy in historical context from A.
Smith to today, bitcoin and crypto currencies – part 2 – AA ch 23, 25 -34 |
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The birth and return of socialism. What is
socialism? |
[articles on the socialist calculation
debate and others] |
Is it a slippery slope? |
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Application: socialism big and small in the
world today – examples Application:
the relationship between equality and poverty |
{N. Korea, Venezuela, E. Germany, Soviet
Union, China, Vietnam, Africa, … ] [Sweden, France, … ] 4 Questions to ask when debating inequality- Steve Horwitz On Thomas Piketty and inequality: · Thomas Piketty and Emmannuel Saez, “Inequality in the long run”. |
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Impediments
to effective interpersonal discussion/communication. Not mutually exclusive.
1.
Lack of trust - the perception of bad motives by your discussion
partner.
2.
Fear of being wrong - an ego commitment to a particular position
that prevents the open consideration of alternatives.
3.
Lack of clarity - a disjoint in the understanding of terms and
concepts - sometimes the result of asymmetric prior education and conditioning.
Number
1 is devastating. 2. is formidable. 3. can be overcome with patience and
determination.