tag:blogger.com,1999:blog-6245381193993153721.post32822130505724595..comments2024-03-28T17:08:15.784-07:00Comments on Social Democracy for the 21st Century: A Realist Alternative to the Modern Left: Rothbard on the US Economy in the 1870s: A CritiqueLord Keyneshttp://www.blogger.com/profile/06556863604205200159noreply@blogger.comBlogger10125tag:blogger.com,1999:blog-6245381193993153721.post-80667000595594438032019-01-05T23:20:49.317-08:002019-01-05T23:20:49.317-08:00I'm sorry, but I have to challenge that an inc...I'm sorry, but I have to challenge that an increase in the industrial index between 1873 and 1879 at a compound annual growth rate of 2.79% is large indeed, although in relative terms (compared with the faster rates of growth seen at other times) I think I've seen statistics of faster rates of industrial growth. Also, real wages of manufacturing workers (as you have shown) and unskilled labour (NBER stats) fell throughout the entire decade (even when the economy was recovering, which is against the Keynesian doctrine) because capital goods industries are most adversely affected by the recession phase of circulation credit cycles (Rothbard's prediction exactly) and real wages must fall for the economy to readjust the structure of production. Also, the recovery at the end of the decade was very markedly strong as you yourself admitted (even if not 6.8%). Your evidence can be made to suit you if you focus on the recession, which Rothbard knew did happen (see America's Great Depression for evidence, but I think he says it in other quotes), but it also suits his case if you look at the overall expansion during that decade.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-57238829591708261532012-09-25T10:37:14.271-07:002012-09-25T10:37:14.271-07:00Yes but my point is you spared Rothbard no kindnes...Yes but my point is you spared Rothbard no kindness, when he was only working with what he had.Patchnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-9863171267194103062012-09-25T10:04:02.981-07:002012-09-25T10:04:02.981-07:00"And how can you blame Rothbard for using the...<i>"And how can you blame Rothbard for using the most up to date statistics at the time? The only people you can blame are current day people."</i><br /><br />I have in fact said this above:<br /><br />"And, while apologists for Rothbard might claim that he did the best with the data he had at the time, that is no excuse for modern Austrians repeating his flawed analysis today"<br />Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-27011744377773976832012-09-25T08:53:03.441-07:002012-09-25T08:53:03.441-07:00You get my comment, LKYou get my comment, LKPatchnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-90480107759072266162012-09-25T06:16:26.635-07:002012-09-25T06:16:26.635-07:00Okay, I didn't see the word late. But that har...Okay, I didn't see the word late. But that hardly changes anything considering that the 1850s and 1880s panics barely differed from the 1870s panic in terms of severity. Also, late from conventional economic historians generally means the gilded age, eg. Post civil war. I would hardly call my criticisms of your interpretation of the data, petty, BTW. And how can you blame Rothbard for using the most up to date statistics at the time? The only people you can blame are current day people.Patchnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-35349513760299159592012-09-24T23:38:36.341-07:002012-09-24T23:38:36.341-07:00"Also, the unemployment rate, while not fanta...<i>"Also, the unemployment rate, while not fantastic and not optimal, was not any worse than what we have now in the U.S."</i><br /><br />Meaning the US now is and was then in a serious economic crisis??<br /><br />On the last point, I agree: if the 19th century had seen fiat money, central banks, and Keynesian fiscal policy we would have seen much better growth rates.Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-91010359693269941542012-09-24T23:35:43.099-07:002012-09-24T23:35:43.099-07:00(1) "I'm not really sure where you get th...(1) <i>"I'm not really sure where you get the 10.83 as the second worst of the 19th century,"</i><br /><br />You've failed to read what I wrote properly: <br /><br />"Davis (2006: 1203) finds that the cumulative industrial index loss (-10.83) was the second worst of the <b>late</b> 19th century, and only surpassed by the double dip recession of the 1890s."<br /><br />Do you notice that word "late," meaning 1850-1900?<br /><br />(2) Davis's findings that the recessions in the 19th century were shorter than in the NBER's data is perfectly consistent with everything I have said above in criticism of Rothbard.<br /><br />(3) regardless of the increase in population, Rothbard is wrong, on the basis of current estimates.<br /><br />Your petty comments do not refute the fact that almost everything Rothbard says is wrong.<br /><br />Lord Keyneshttps://www.blogger.com/profile/06556863604205200159noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-41531231596899837252012-09-24T18:51:22.007-07:002012-09-24T18:51:22.007-07:00First,
Far be it from me to defend Rothbard, but ...First,<br /><br />Far be it from me to defend Rothbard, but I will defend Friedman and Schwartz; The Kuznets data was the best available data they had at the time.<br />Second, as you said, the estimates back then were highly unreliable. Personally I find the Balke and Gordon estimates of Real gdp /gnp growth to be most compelling. And what you find with these authors is a growth period as good if not SLIGHTLY better than the postwar period. Also, the unemployment rate, while not fantastic and not optimal, was not any worse than what we have now in the U.S. Only 1878 saw an unemployment rate above 8%, which is the rate now in the U.S.<br /><br />Thirdly, the recessions of the era are probably due to bad monetary or fiscal policy. Had there been Friedmanite or "libertarian Keynesian" (tax cuts, rather than increased government spending) countercyclical policy, with fiat money and a central bank, the growth rates would have been even higher than the post world war 2 era or even the neoliberal era. Edwardnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-65237001092116188642012-09-24T14:29:43.463-07:002012-09-24T14:29:43.463-07:00Lord Keynes,
A couple of points (I'll be brie...Lord Keynes,<br /><br />A couple of points (I'll be brief, since it seems that what I say goes past you again and again).<br /><br />I'm not really sure where you get the 10.83 as the second worst of the 19th century, considering what Davis wrote on page 28 of his first paper (2004). Out of all the recessions during the years he analyzed, the 1873-1875 decline ranks 8th. In terms of the 1800s, it ranks 5th. <br /><br />Lets not forget what he also writes:<br /><br />"The new set of industrial<br />cycles may also change the conventional view on specific nineteenth-century business cycles. The largest changes in the duration of cycles shared by the new and NBER chronologies involve periods when wholesale prices dropped dramatically and persistently, such as following the War of 1812 and the financial panics of 1837 and 1873. The quantity-based production data display<br />shorter contractions and shallower losses following those crises than that portrayed in the popular and trade press. One plausible explanation for the disparity may be that the media confused commercial crises with financial ones, because the latter were better characterized by falling commodity and security prices, rather than declines in real industrial activity "<br /><br />I have already written extensively about B&G figures and Vernon's unemployment estimates. As I have said before, I have a paper on this coming out, and I will let you know when it is available. <br /><br />Thirdly, the per capita GNP estimates don't take into consideration the fact that population growth was MUCH higher in the 1800s than in the post WWII 1900s. From 1860-1890, the population increased 100%. From 1940-1970, the population 50%. <br /><br />http://www.u-s-history.com/pages/h980.html<br /><br />Happy Hunting,<br /><br />PatchPatchnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-39847999348789138022012-09-24T12:52:56.191-07:002012-09-24T12:52:56.191-07:00Murray Rothbard: poet of the new era of government...Murray Rothbard: poet of the new era of government intervention, imperialism and monopoly capitalism. The man's general ignorance really is outstanding.Philip Pilkingtonhttp://www.nakedcapitalism.comnoreply@blogger.com