Friday, April 8, 2011

Some Things Learned Before 40

Excerpts from Bryan Caplan’s post at EconLog about 40 things he learned by the time he turned 40. These excerpts are required in the very broadest sense:

1. Supply-and-demand solves countless mysteries of the world - everything from rent control to road congestion.
2. Almost anyone can understand supply-and-demand if they calmly listen.  Unfortunately, the inverse is also true.
3. Poverty is terrible, and economic growth, not redistribution, is the cure.
4. The proximate causes of unemployment are labor market regulation and workers' misguided beliefs about fairness.  But the fundamental cause of unemployment is excessive wages. 
6. Governments with fiat money have near-absolute power over nominal GDP, but much less over real GDP or employment.
8. Immigration restrictions are a fruitless crime - and do more harm than all other government regulations combined.
9. Communism was a disaster because of bad incentives, not lack of incentives.
10. The last two centuries of rising population and prosperity should fill us with awe - and the best is yet to come.
3. If you can't explain your position clearly in simple language, you probably don't understand it yourself.
9. Violence and theft are presumptively wrong, and calling yourself "the government" does nothing to rebut these presumptions.
1. Voters are irrational.  So is believing otherwise.
2. Government isn't a solution to externalities problems; it's the best example of the problem.
3. The main output of government isn't "public goods," but private goods that people pretend to want much more than they really do.  See Social Security and Medicare.
4. People rarely make the the most internally consistent argument for government action: paternalism.
7. Before you study public opinion, you wonder why policy isn't far better.  After you study public opinion, you wonder why policy isn't far worse.
10. Despite everything, life in First World democracies is amazingly good by world and historic standards and will keep getting better.  So cheer up.


6. People vary more widely than you think.  Tell yourself it's nobody's fault.
10.  Evolutionary psychology is by far the best universal theory of human motivation.  Ignore it at your own peril.

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