Conformity can be costly in a world of uncertainty which requires innovative institutional creation because no one can know the right path to survival. Over time, the richer the cultural context in terms of providing multiple experimentation and creative competition, the more likely the successful survival of the society
The evolution of government from its medieval, Mafia-like character to that embodying modern legal institutions and instruments is a major part of the history of freedom. It is a part that tends to be obscured or ignored because of the myopic vision of many economists, who persist in modeling government as nothing more than a gigantic form of theft and income redistribution.
To predict the future we would have to know today what we will learn tomorrow which will shape our future actions
Economists have the correct insight that economics is a theory of choice, the key to the story is the variety of options and centralised political control limits the options. The best recipe is adaptive efficiency coping with novel uncertainty in a non-ergodic world, the maintenance of institutions which enable trial & error experiment to occur, and an effective means of eliminating unsuccessful solutions
Information costs are reduced by the existence of large numbers of buyers and sellers. Under these conditions, prices embody the same information that would require large search costs by individual buyers and sellers in the absence of an organized market.
Regarding social order, [Francis] Fukuyama writes, "The systematic study of how order, and thus social capital, can emerge in spontaneous and decentralized fashion is one of the most important intellectual developments of the late twentieth century." He correctly attributes the modern origins of this argument to F. A. Hayek, whose pioneering contributions to cognitive science, the study of cultural evolution, and the dynamics of social change put him in the forefront of the most creative scholars of the 20th century.
I went back to graduate school with the clear intention that what I wanted to do with my life was to improve societies, and the way to do that was to find out what made economies work the way they did or fail to work.
It was not until I got my first job, at the University of Washington in Seattle, and began playing chess with Don Gordon, a brilliant young theorist, that I learned economic theory.
The supremacy of Parliament and the embedding of property rights in Common Law put political power in the hands of men anxious to exploit the new economic opportunities and provided the framework for a judicial system to protect and encourage productive economic activity
Our family life was certainly not intellectual.
My record at the University of California as an undergraduate was mediocre to say the best.
What the war did was give me the opportunity of three years of continuous reading, and it was in the course of reading that I became convinced that I should become an economist.
While I was there I became deeply interested in photography, and indeed the most noteworthy event in my early life was winning first, third, fourth and seventh prizes in an international competition for college and high school students.
My brother and sister are both older than I am and were born before my father went off to World War I.
I continue to be a photographer; I have enjoyed fishing and hunting with a close friend; and have owned two ranches, first in northern California and then in the state of Washington.
My early work and publications centered around expanding on the analysis of life insurance in my dissertation and its relationship to investment banking.
I had hoped to go to law school, but the war started, and because of the strong feeling that I did not want to kill anybody, I joined the Merchant Marine when I graduated from Berkeley.
I learned to fly an airplane, and had my own airplane during the 1960s.
In 1972 I married again, to Elisabeth Case; she continues to be wife, companion, critic and editor: a partner in the projects and programs that we undertake.
