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To: Bearded One who wrote (21585)	11/20/1998 1:13:00 AM
From: Gerald R. Lampton	Read Replies (1) \| Respond to of 24154

I've not read Hayek (could you recommend a good starting book?) It depends on what you want to read him for. I started with The Road To Serfdom, which is probably his most famous book. It explains his thesis that a system based on economic planning will lead inevitably to totalitarianism. To him, Fascism and Soviet Communism are just two variations of the same planning-based socialist social order. Then, because I was specifically interested in law, I read The Constitution of Liberty,, the three volume series, Law, Legislation and Liberty, and, for a good overview of his general political ideas, The Fatal Conceit, which, if you can only read one book by him, is the one to read. It was the last book he wrote before he died and a good summary of his overall philosophy. It is also the first book in the Collected Works series. These lay out pretty completely his theories about law and politics. His is the first non-positivist theory of jurisprudence (some call him a "natural law" theorist, but that is not really accurate) which makes sense to me. Right now, I'm working on the collected works, and I have on order Denationalization of Money and Prices and Production, which is an early work which lays out his theories about the business cycle. So, I'm getting further and further afield from where I started, deeper and deeper into his economic theories and away from the political stuff. If you read volumes 3 and 4 of the Collected Works, they give a pretty good reading list of all the great political economists of the classical and Austrian traditions, with Hayek's summary of their contributions and citations to their major works. All of these are a very good antidote for the sort of mathematical, pseudo-scientific economics that is done today. He is also the most uncompromising classical liberal I have ever read. Having read a couple of volumes by our mutual hero-worship-object, W. Brian Arthur, and his criticisms of equilibrium economics, I was very surprised to learn that Hayek's theories, apart from being very un-mathematical, do not rely on static equilibrium models (i.e., "perfect competition,") and and all their unrealistic assumptions (such as that old whipping boy, "perfect knowledge"). Just to give you the editor's take: Hayek's ultimate endorsement of markets is not based on their alleged Pareto-efficiency characteristics. Rather, a system of free markets is one among a number of institutions that are vital for the discovery and creation of knowledge and for the coordination of agents' plans in a world in which knowledge is dispersed and error is possible. B. Caldwell, ed., 10 Collected Works of F.A. Hayek 30 (1997) (introduction). And, as an added bonus, Hayek is the libertarian author, so, if you really read all this stuff, you will be able to debate the merits and demerits of libertarianism with the best of 'em.

To: Bearded One who wrote (21585)	11/20/1998 2:42:00 AM
From: Gerald R. Lampton	Respond to of 24154

Perhaps unfairly, I have dodged your other questions to me in this post. I'll not discuss your hypotheticals, but focus on antitrust. I think that the various antitrust remedies violate Hayek's criteria for what he calls "rules of just conduct," which, if I understand him correctly, are the only rules he would allow the government to apply to the private sector. Structural remedies, i.e., breaking up monopolistic firms, are out and out "intervention" as Hayek (perjoratively) defines the term. There is no principled basis for determining, in advance, what firms the DOJ will try to break up and which they won't (other than the basic requirement that a firm be a monopoly). Rule-based remedies violate a number of proscriptions: 1. They do not apply equally to all firms. They only apply to the minority of firms (definitionally so) that are monopolies. And they are imposed against the will of this minority. 2. They are not neutral or ends-independent. A general rule of just conduct should not be imposed for the purpose of achieving a particular end result, especially if the end is a particular distribution of income or power. Antimonopoly rules apply only when their application will achieve the goal of maximising consumer welfare, or, in a non-Bork world, the goal of producer equity. I must be honest: my understanding of these principles is less than perfect. I would certainly invite anyone to correct me if I am wrong.