Would You Want Mises Grading Your Term Paper?
I am trying to figure out how to work this into the study guide on Mises’ Theory of Money and Credit, but I don’t think I can. So, I share it with you. On page 125 of the LvMI’s latest edition, Mises says that only by acknowledging that money’s value derives not just from its industrial uses, but also its role as a medium of exchange, can one explain “phenomena such as the Austrian or Indian currency systems.” Then he says:
The naivety of the numerous writings which attacked this opinion and their complete freedom from the restraining influence of any sort of knowledge of the theory of value may occasionally lead the economist to regard them as unimportant; but they may at least claim to have performed the service of shaking deep-rooted prejudices and stimulating a general interest in the problem of prices.
I realize I am biased, but I think even Mises’ insults are cooler than Krugman’s.
And yet, if it were asked whether understanding
of the connection between money and prices has made
great progress during these years, at any rate until
very recently, or whether the generally accepted doctrines
on this point have progressed far beyond what was
generally known a hundred years ago, I should be
inclined to answer in the negative. This may seem
paradoxical, but I think anyone who has studied the
monetary literature of the first half of the nineteenth
century will agree that there is hardly any idea in
contemporary monetary theory which was not known
to one or more writers of that period. Probably the
majority of present-day economists would contend
that the reason why progress has been so slight is that
monetary theory has already reached such a state of
perfection that further progress must of necessity be
slow. But I confess that to me it still seems that some
of the most fundamental problems in this field remain
unsolved, that some of the accepted doctrines are of
a very doubtful validity, and that we have even failed
to develop the suggestions for improvement which can
be found in the works of these early writers.
Reading a lot of Mises, I have always found his insults to be wonderful. They make Krugman’s look like those of a twelve-year old.