Mario J Rizzo

The purpose of this paper is to first review William James's explicit positions on paternalism in the context of medical licensure and the annexation of the Philippines. Then I wish to show that these positions, as well as a more generalized antipaternalist stance, are the implications of James's philosophy and psychology and not simply his ‘personal’ sentiments. The elements of James's thought are arranged in such a way as to facilitate a comparison with contemporary behavioral (heuristics and biases) paternalism. The conclusion is that James has arguments against behavioral paternalism avant la lettre that are still useful and deserve discussion.

Abstract. Herbert Spencer (1820–1903) believed that Victorian Britain was moving toward a society of total regimentation (“slavery”). This movement was part of a cosmic process of evolution and dissolution. While the long-run (but not ultimate) destination of society was a “higher ” form of social organization based on voluntary and complex interpersonal relationships, the immediate tendency was retrograde—a movement away from the liberation of mankind from the bondage of previous eras. This Article explores (1) the reasons for the retrograde movement, (2) its “inevitability, ” and (3) the role of ideas in the process. The general conclusion is that in an effort to explain the general movement of social institutions and practices, Spencer develops a mechanical and deterministic approach which undermines his ability to pass normative judgements on changes in society. 1. Prologue Herbert Spencer, who was more radical than any radical and, yet, more conservative than any conservative, ...

Abstract. Herbert Spencer (1820–1903) believed that Victorian Britain was moving toward a society of total regimentation (“slavery”). This movement was part of a cosmic process of evolution and dissolution. While the long-run (but not ultimate) destination of society was a “higher ” form of social organization based on voluntary and complex interpersonal relationships, the immediate tendency was retrograde—a movement away from the liberation of mankind from the bondage of previous eras. This Article explores (1) the reasons for the retrograde movement, (2) its “inevitability, ” and (3) the role of ideas in the process. The general conclusion is that in an effort to explain the general movement of social institutions and practices, Spencer develops a mechanical and deterministic approach which undermines his ability to pass normative judgements on changes in society. 1. Prologue Herbert Spencer, who was more radical than any radical and, yet, more conservative than any conservative, ...

The purpose of this essay is to describe and analyze the Austrian approach to law and economics within the context of the law and economics discipline. The important and distinctive feature of the Austrian approach is the emphasis on economic and legal processes. We focus on four themes within the Austrian approach to law and economics: the spontaneous origin of legal institutions; the analysis of implications of ignorance, decentralization of knowledge, and static and dynamic uncertainty; the interaction between the changes in legal institutions and the market process and coordination; and entrepreneurship in market and non-market settings.

A central theme in this series is the importance of understanding and assessing the market economy from a perspective broader than the static economics of perfect competition and Pareto optimality. Such a perspective sees markets as causal processes generated by the preferences, expectations and beliefs of economic agents. The creative acts of entrepreneurship that uncover new information about preferences, prices and technology are central to these processes with respect to their ability to promote the discovery and use of knowledge in society. The market economy consists of a set of institutions that facilitate voluntary cooperation and exchange among individuals. These institutions include the legal and ethical framework as well as more narrowly ‘economic’ patterns of social interaction. Thus the law, legal institutions and cultural and ethical norms, as well as ordinary business practices and monetary phenomena, fall within the analytical domain of the economist.

This chapter draws on the history of economic thought to elucidate the foundations of the Austrian economics conception of rationality. First, it shows how Austrian subjectivism was originally differentiated from nineteenth-century and early-twentieth-century psychologically based economics. Then it shows how the Austrians differentiated themselves from the behaviorist approach that began to affect economics as early as the 1910s but mainly from the 1920s to the 1950s. Finally, drawing on the work of Friedrich Hayek and Alfred Schutz, it shows that the Austrian conception of rationality is not based on introspection and illustrates the differences between an Austrian approach and that of today’s new behavioral economics.

This article describes and analyzes the Austrian approach to law and economics within the context of the law and economics discipline. The important and distinctive feature of the Austrian approach is the emphasis on economic and legal processes. The article focuses on four themes within the Austrian approach to law and economics: the spontaneous origin of legal institutions; the analysis of implications of ignorance, decentralization of knowledge, and static and dynamic uncertainty; the interaction between the changes in legal institutions and the market process and coordination; and entrepreneurship in market and non-market settings.

The Economics of Time and Ignorance "The title of this valuable work…comes from a remark of JM Keynes: 'The social object of skilled investment should be to defeat the dark forces of time and ignorance which envelop our future.' The moral of this work, however, is that time and ...

Murray Rothbard was a tenacious defender of the praxeological project originated by Ludwig von Mises. In his most extensive and most consciously theoretical work, Man Economy and State he attempted to give clear and complete expression to Mises's vision. This is particularly evident in his treatment of Interest and Capital1. He examines these topics with a view to uncovering for the reader their 'essential'nature-providing an accurate picture of those essential characteristics that make Interest and Capital what they are.

Murray Rothbard was a tenacious defender of the praxeological project originated by Ludwig von Mises. In his most extensive and most consciously theoretical work, Man Economy and State he attempted to give clear and complete expression to Mises's vision. This is particularly evident in his treatment of Interest and Capital1. He examines these topics with a view to uncovering for the reader their 'essential'nature-providing an accurate picture of those essential characteristics that make Interest and Capital what they are.

... The ball had emanated from a nearby cricket field which had never before been the source of such an 7 See Rizzo & Arnold, supra note 3, at 12-13. ... If there is a "substantial risk," then the owner of the cricket field ought to make the cost-benefit calculation himself. ...

The editors of this volume have asked the contributors to take a critical look at Austrian economics and ask several questions. What does the future hold for the Austrian tradition? What areas seem particularly promising for future research? What are the weaknesses of Austrian analysis and how important are they in a total assessment of the research program? In this Afterword we shall address ourselves to these questions by taking a very broad look at the prospects for Austrian economics in the fast approaching twenty-first century. We shall address some of the themes in specific contributions to this volume in order to make a general assessment of the overall trends and prospects in the field. In the spirit of critical rationalism we shall venture a bold conjecture:Without significant changes in its traditional research topics and strategies (as begun here and elsewhere),Austrian economics will become increasingly irrelevant to the major intellectual currents in the next century and will ultimately fail to survive.

Both behavioral and neoclassical economists maintain a concept of strict rationality that is exceptionally narrow. Neoclassicists use it as a tool both to explain what agents actually do and as a prescriptive framework. Behavioralists do not believe it adequately explains actual behavior but that it is still a good prescriptive framework. My view is that whatever the technical virtues of strict, narrow rationality in providing a foundation for useful economics constructs, it is completely inadequate as a prescriptive standard. The appropriate concept of rationality for evaluation purposes must be " liberal " or broad reflecting the complexities of human decisionmaking. Behavioral economists are blind to much of this at a normative-prescriptive level. So their critique of market or other outcomes is impoverished. Reason is large. To ask the question whether some instance of human behavior is rational is tricky. Definitive answers that the behavior is not often rest on some technical narrowing of the meaning of rationality designed for a specific purpose in some other context. Often that specific purpose gets lost in the discussion. Statements about instrumental rationality need to be tied down to specific meanings, contexts and consequences. And then there is the normative-positive distinction. Concepts of rationality may be useful when applied to understanding actual behavior. When they fail, it doesn't necessarily mean that the agents are in error and that must correct themselves or be corrected. The economist may simply be using the wrong model. On the other hand, applying a normative standard to human behavior is a sensitive task for economists. Unless they are going to replace the value-judgments and perspectives of the agents with their own, they must have a broad view of what constitutes their agents' interests. What misleads economists is that the " normative " criteria they have developed – the axioms of rationality – were developed in the service of giving choice theory a firm logical foundation. This foundation was designed to rid economics of any specific psychological presuppositions and thus increase the generality of the theory. Then economic theory could understand choice

Behavioral economists point to deficient willpower as one of the causes of breakdowns in decisionmaking processes. Individuals, it is claimed, know their optimal course of action but sometimes are unable to implement it because they lack sufficient motivation. This paper demonstrates that the presence of deficient willpower is very difficult to ascertain empirically. There are many phenomena that, consistent with a broad notion of rationality, must be isolated before deficient willpower can be identified. Philosophers have conceptually identified many of them. Behavioral economists, on the other hand, have not been rigorous in their conceptualization of willpower and therefore are unable to identify clear cases of deficiency. Furthermore, the empirical knowledge required of the behavioral economist to identify willpower deficiency are greater than can be satisfied in a public policy context. Therefore, deficient willpower is a poor explanation of behavior and attempts to ameliorate it are inappropriate for public policy. Philosophers and behavioral economists generally treat weakness of will (akrasia) or deficient willpower as a failure of full rationality. If a rational individual judges that, all things considered, the advantages of an option a exceed those of b, that individual will choose a over b. The agent's evaluative judgment and his motivation are perfectly aligned. For the akratic individual the situation is otherwise. He knows the better option but chooses the worse. Deficient willpower is real phenomenon or, at least, ordinary people perceive it to be. Nevertheless, it is not easily distinguished empirically from other kinds of behavior. The philosophical literature appeals to hypothetical stories in which all of the relevant information is assumed. Then it goes on to distinguish various cases of behavior that are or are not