Economists From The United States

"There is no need to deny that other 'objectives' are often important—power, prestige, public approval, or the mere love of the game— it need only be recognized that the attainment of these ends more often than not is associated directly with the ability to make profits."

"Management tries to make the best use of the resources available."

"We believe that, in order to understand contemporary economic decision making, we need to supplement the study of market factors with an examination of the internal operation of the firm – to study the effects of organizational structure and conventional practice on the developments of goals, the formation of expectations, and the execution of choices."

"Internal inducements to expansion arise largely from the existence of a pool of unused productive services, resources and special knowledge, all of which will always be found within any firm."

"Relatively unsuccessful firms would be more likely to innovate than relatively successful firms."

"Difficulties arise when an attempt is made to acclimatize the theory to an alien environment and, in particular, to adapt the analysis of the expansion of the innovating multi-product, ‘flesh and blood’ organisations that businessmen call firms."

"In recent years there has been increased interest in the effects of internal communication on decision processes. A number of hypotheses relating the bias in information to the final decision have been proposed. In this paper we discuss two laboratory experiments which were designed to test two such hypotheses. The first experiment tests the hypothesis that cost and sales estimations are made with the implicit assumption that a biased pay-off structure exists. The second experiment tests explicitly the effects of biased and unbiased pay-off structures on estimation within an organization. An analysis of the data for the two experiments is made and some implications for further research are drawn from the results."

"Effective retention is heavily dependent on recruiting students with the potential to graduate."

"A firm is more than an administrative unit; it is also a collection of productive resources the disposal of which between uses and over time is determined by administrative decision."

"A firm is essentially a pool of resources the utilization of which is organized in an administrative framework."

"After two years of study, I'm happy to tell you that dire projections about declines in the U.S. work force due to technological change are exaggerated at best."

"We cannot simply rely on a program of pollution abatement in country A [the polluting country] for this would impose costs on A with no offsetting benefits to the polluting country. The OECD’s Polluter-Pays-Principle is thus inconsistent with our insistence on a Pareto improvement. Mutual gains to the countries necessarily require the victim country B to make some payments to A."

"The price-tax conditions necessary to sustain the Pareto optimality of a competitive market solution under the assumed convexity conditions are tantamount to standard Pigovian rules, with neither taxes imposed upon, nor compensation paid to, the victims of externalities."

"If profits are a condition of successful growth, but profits are sought primarily for the sake of the firm, that is, to reinvest in the firm rather than to reimburse owners for the use of their capital or their 'risk bearing,' then, from the point of view of investment policy, growth and profits become equivalent as the criteria for the selection of investment programmes."

"Mrs Penrose was a senior economist in the Merrill/ Johns Hopkins research into the growth of firms and her book was much looked forward to. She does indeed make wise observations, out of her research and her wide reading, about various things which happen, or may happen, in a growing business... A theory of the growth of firms surely should involve generalizations about their economic environment, or, in other words, just those questions about the (equilibrium) structures of industries which the author rules out of court at the start."

"The difficulty in defining a field for the so-called institutional economics is the uncertainty of meaning of an institution. Sometimes an institution seems to mean a framework of laws or natural rights within which individuals act like inmates. Sometimes it seems to mean the behavior of the inmates themselves. Sometimes anything additional to or critical of the classical or hedonic economics is deemed to be institutional. Sometimes anything that is "economic behavior" is institutional. Sometimes anything that is "dynamic" instead of "static," or a "process" instead of commodities, or activity instead of feelings, or mass action instead of individual action, or management instead of equilibrium, or control instead of laissez faire, seems to be institutional economics."

"Economic theory, since the time of the Physiocrats, has endeavored to get rid of the human will and to explain economic phenomena in terms of physical and hedonic forces. The human will had been the main reliance of the Mercantilists and of the economic theory of the Church fathers. But the will was arbitrary, capricious and contrary to natural laws. There were two stages of these physical theories which attempted to get away from the will:-the natural rights arld physical equilibrium stage of foreordained evolution of Quesnay, Adam Smith and Karl Marx, and the natural selection stage of blind evolution that followed Darwin, whose distinguished exponent in economics is Veblen. The theorists of each stage attempted to get rid of the human will and to explain economic phenomena as the working out of natural forces, either foreordained or blind. It was a concept of society as the natural growth of a mechanistic equilibrium."

"While mere process of thinking is the process of habits, ideals, definitions, investigations, classifications, valuations and behavior, due process of thinking, which is due process of law, is the process of correct habits, right ideals, true definitions, sincere investigation, reasonable classification, reasonable value, and justice; whereas its opposite, undue process, is perverse habit, wrong ideals, double meanings, partial investigation, class legislation, confiscation and injustice."

"An institution is defined as collective action in control, liberation and expansion of individual action. Its forms are unorganized custom and organized going concerns. The individual action is participation in bargaining, managing and rationing"

"Liberty, as such, is only the negative of duty, the absence of restraint or compulsion."

"Historically, land taxes are commutations of physical rents into money-rents, and taxes are not something taken from private property by the sovereign, but property is sovereignty taken collectively from the King by his tenants."

"Liberty is absence of restraint. Freedom is participation in government."

"Liberty is as much a matter of compulsion as duty, but where duty says to a person that he must or must not, liberty says to other persons that they must not interfere with that person, or that they even must help to prevent still other persons from interfering, if necessary."

"The ‘liberty’ of one is his permission to act as he pleases, supported against interference by the power of the concern or government"

"Legally, the term liberty means absence of duty, or rather the limit of duty."

"The binding power of custom is its security of expectations. What has happened before may be expected to happen again, and he who arbitrarily disappoints expectations must be restrained or punished."

"Economic theory deals with two concepts, Value and Economy. Abstract reasoning regarding these concepts rests ultimately on mathematical concepts of quantity, time and energy. The three are inseparable, for quantity and time are dimensions of energy. The quantity relationships of energy, usually termed "statics," turn on the problem of the relation of the parts to the whole, while the time relationships, usually termed "dynamics," are the relations of a process that connects past, present and future."

"It would not be incorrect to say that all capital is invisible value, in that it is the present value, not of physical things, but of the hopes of the future aroused through confidence in the now invisible but expected transactions of the future."

"The aim of this volume is to work out an evolutionary and behavioristic, or rather volitional, theory of value. It was commenced thirty-five years ago at Johns Hopkins University under my stimulating teacher, Richard T. Ely."

"In the entire circuit of the globe those races which have developed under a tropical sun are found to be indolent and fickle. From the standpoint of survival of the fittest, such vices are virtues, for severe and continuous exertion under tropical conditions bring prostration and predisposition to disease. Therefore, if such races are to adopt that industrious life which is a second nature to races of the temperate zones, it is only through some form of compulsion. The negro could not possibly have found a place in American industry had he come as a free man."

"The division of opinion turns on the definition of property and the scope of contract. Physical things of themselves are powerless. Even liberty to choose between opportunities is passive and ineffective. But power to withhold opportunities is economic power, and associated power is government. When therefore liberty of contract is merged with property, it adds the liberty of persons to the exclusive holding of things. And this liberty operates in the several directions of liberty to combine their property into an industrial government and to act as a unit, not only in proportioning their resources economically but also in choosing opportunities, in commanding obedience, in persuading or coercing, and in planning for the expectations of an indefinite future."

"The concept of property itself had come up out of the common law and carried with it the idea of a natural, or common-law rights of liberty to acquire, use and dispose of physical things."

"These individual actions are really trans-actions instead of either individual behavior or the "exchange" of commodities. It is this shift from commodities and individuals to transactions and working rules of collective action that marks the transition from the classical and hedonic schools to the institutional schools of economic thinking. The shift is a change in the ultimate unit of economic investigation. The classic and hedonic economists, with their communistic and anarchistic offshoots, founded their theories on the relation of man to nature, but institutionalism is a relation of man to man. The smallest unit of the classic economists was a commodity produced by labor. The smallest unit of the hedonic economists was the same or similar commodity enjoyed by ultimate consumers. One was the objective side, the other the subjective side, of the same relation between the individual and the forces of nature. The outcome, in either case, was the materialistic metaphor of an automatic equilibrium, analogous to the waves of the ocean, but personified as "seeking their level." But the smallest unit of the institutional economists is a unit of activity -- a transaction, with its participants. Transactions intervene between the labor of the classic economists and the pleasures of the hedonic economists,simply because it is society that controls access to the forces of nature, and transactions are, not the "exchange of commodities," but the alienation and acquisition, between individuals, of the rights of property and liberty created by society, which must therefore be negotiated between the parties concerned before labor can produce, or consumers can consume, or commodities be physically exchanged."

"There [is]... a list of five tests which any body of doctrine which aspires to the name of economic theory must be able to meet:"

"The boot and shoe makers, either as shoemakers or “cordwainers,” have been the earliest and the most strenuous of American industrialists in their economic struggles. A highly skilled and intelligent class of tradesmen, widely scattered, easily menaced by commercial and industrial changes, they have resorted with determination at each new menace to the refuge of protective organizations."

""Institutional economics" alone meets the demand for a generalized description of the economic order. Its claim is to explain the nature and extent of order amid economic phenomena, or those concerned with industry in relation to human well-being. In the words of Edwin Cannan, it attempts to tell "why all of us are as well off as we are" and "why some of us are better off than others." Such an explanation cannot properly be answered in formulas explaining the processes through which prices emerge in a market. Its quest must go beyond sale and purchase to the peculiarities of the economic system which allow these things to take place upon particular terms and not upon others."

"In some form or other the rivalry of men will continue to be employed as an instrument of the general welfare. It is not important that the arrangements which currently are set down as the competitive system will endure. It is important that the spirit of competition shall be enhanced and not impaired. There must be an outlet for the creative urge, free play for the dynamic drive. In a society, as in the physical world, motion is inseparable from life."

"An explanation of the "institutional approach" to economic theory is a plea for a particular kind of theory. It is possible to come upon the same object from different angles; but more often those who take different routes chance upon different things. The "institutional approach" doubtless has some importance because it is a happy way to acceptable truth, but its significance lies in its being the only way to the right sort of theory. An appeal for "institutional economics" implies no attack upon the truth or value of other bodies of economic thought, but it is a denial of the claims of other systems of thought to be "economic theory." This, however, is no pointless struggle in method to be carried on by breaking syllogisms over concepts and by engaging in polemics over niceties in statement. On the contrary, it involves the very nature of the problems which the theorist should set himself; its real issue is over what economic theory is all about."

"INSTITUTION is a verbal symbol which for want of a better describes a cluster of social usages. It connotes a way of thought or action of some prevalence and permanence, which is embedded in the habits of a group or the customs of a people."

"Other races of immigrants, by contact with our institutions, have been civilized—the negro has only been domesticated."

"It is an easy and patriotic matter for the lawyer, minister, professor, employer, or investor, placed above the arena of competition, to proclaim the equal right of all races to American opportunities; to avow his own willingness to give way should even a better Chinaman, Hindu, or Turk come in to take his place; and to rebuke the racial hatred of those who resist this displacement. His patriotism and world-wide brotherhood cost him and his family nothing, and indeed they add to his profits and leisure."

"The Chinese and Japanese are perhaps the most industrious of all races, while the Chinese are the most docile. The Japanese excel in imitativeness, but are not as reliable as the Chinese. Neither race, so far as their immigrant representatives are concerned, possesses the originality and ingenuity which characterize the competent American and British mechanic."

"The smallest unit of the institutional economists is a unit of activity — a transaction, with its participants. Transactions intervene between the labor of the classic economists and the pleasures of the hedonic economists, simply because it is society that controls access to the forces of nature, and transactions are, not the "exchange of commodities," but the alienation and acquisition, between individuals, of the rights of property and liberty created by society, which must therefore be negotiated between the parties concerned before labor can produce, or consumers can consume, or commodities be physically exchanged."

"Since institutional economics is behavioristic, and the behavior in question is none other than the behavior of individuals while participating in transactions, institutional economics must make an analysis of the economic behavior of individuals."

"But institutional economics is the field of the public interest in private ownership, which shows itself behavioristically in buying and selling, borrowing and lending, hiring and firing, leasing and renting. The private interests become the field of intangible yet quantitative and measurable rights, duties, liberties and exposures to the liberties of others. These are various aspects of rights of ownership. What we buy and sell is not material things and services but ownership of materials and services. The correlation of engineering economics, home economics, and institutional economics makes up the whole of the science of political economics."

"I do not overlook the important contributions to economic theory in the past whether orthodox or heterodox I correlate them with institutional economics. The classical and communistic economists used as their measure of value the man hour of labor. This is evidently since the incoming of scientific management the engineering economics of efficiency. The Austrian and hedonistic economists deriving from Bentham used as the measure of value the diminishing marginal utility of consumption goods. This is evidently the home economics recently introduced in the college curriculum."

"We are in a a period of huge change and very dangerous change right now and I'm here to tell you to help lead a safe way out of this. For some reason the generation of politicians running the world right now is not very prudent, not very wise, and is not leading us to safety. We're in an extraordinarily dangerous time. And that is not intrinsic to our circumstances at all, because with the same conditions that we have, we could view our situation as wonderfully promising, exciting, a time when the whole world could be achieving very big things. We could understand, which we don't yet, that we are not in a game of "who's number one" or "who's ahead" or "who runs the world." We're all blessedly stuck together on this planet and we're all going to have pretty much the same outcome, either a good outcome or a disaster. And the old ideas that it's really important who sets the rules and really important who wins the wars are very outmoded."

"Macron gave me the Legion of Honour and privately told me what he does not say in public: the war [in Ukraine 2022] is NATO's fault."

"The war [in Ukraine] started 9 years ago, not last year. I think it started in February 2014. It started with the violent overthrow of President Yanukovich, which I attribute to a significant extent of US participation in the regime change operation in Ukraine. And, in my mind, that really was the trigger of this war, meaning that we are basically seeing a proxy war between the United States and Russia."

"The war in Ukraine is the culmination of a 30-year project of the American neoconservative movement."