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On two separate occasions in the last couple of weeks, people have asked me a familiar question:  “In a system of ‘anarcho-capitalism’ or the free-market order, wouldn’t society degenerate into constant battles between private warlords?”  Unfortunately I didn’t give adequate answers at the times, but I hope in this article to prove the adage that

In a recent article , I discussed the possibility of private, competing security agencies.  I took for granted the background rule of law (or lack thereof), and merely made the relative argument that a monopoly institution of violence (i.e. the State) would not aid the achievement of a working consensus on legal norms, and that in fact (as history

The Sicilian Mafia: The Business of Private Protection , by Diego Gambetta [Cambridge: Harvard University Press, 1993), vi + 335 pages] Diego Gambetta’s book is an excellent work of scholarship that seeks to apply economic theory to the Sicilian mafia. In addition to its formal analysis, the book explains the historical origins of the mafia, and

If you are like me, you love Austrian economics — the logic, the rigor, the explanatory power. But we all know that this is not the usual approach to economics taken at the university level. If you can’t attend the Mises University, where can you go to study the subject systematically? Over the summer, I worked with the staff at the Mises

Now that the furor over the botched response to Hurricane Katrina has largely subsided, we can calmly examine an aspect of the episode that most commentators have neglected. Let me motivate the examination by first making the (perhaps surprising) claim that I don’t think the FEMA bureaucrats did anything particularly outrageous. Yes, it is true

It seems that many pundits believe that at any given time, at least one half of the world’s population should be in moderate fear of US bombing campaigns. Besides North Korea and the entire Middle East, China has of late been the object of growing hostility. The tough talk passed a qualitative boundary over Thanksgiving weekend when analysts on

A recent article from the Guardian joins the growing outcry against free trade. Its central message is that countries adopting “neo-liberal” market reforms, recommended by academic economists, have done worse than those countries that ignored the supposed experts and spurned free trade. Every time I reread the article—with the subtitle “A look at

There are numerous clichés concerning the national (i.e. federal government) debt. In this article I attempt to show the grain of truth (and pile of falsehood) in these typical statements. But before doing so, I will first give a quick primer on government debt and its financing. GOVERNMENT DEBT When the government spends more than it takes in

In response to my last article on government deficits , Stefan Karlsson alerted me to an openly Keynesian analysis at National Review Online. Although Tom Nugent’s surprising piece ran back in 2004, its errors are timeless and hence worth exploding even today. CONFUSING CORRELATION WITH CAUSATION Nugent commits the standard Keynesian fallacy of

It’s not easy being an economist. To get your degree nowadays, you have to first become a (second rate) mathematician. Then you start teaching and half of your students require artificial stimulants during the lecture on price elasticity. Even at social gatherings, the burden follows you: The moment your occupation becomes known, someone