Thursday, April 11, 2019

It Is Said that History Repeats Itself. One Can Say the Same about Economists. John Law of Mississippi Bubble Fame Returns Two Hundred Years Later as John Maynard Keynes

Ironically, it is due to a Keynesian economic policy and its monetary apparatus, i.e., that of expanding the supply of money to increase economic activity, that speculative price bubbles and manias are engendered. This was exemplified by John Law, whose system (driven by a huge increase in the supply of money) created the Mississippi Bubble in France. Law, who preceded Keynes by two hundred years, held many of the same views as Keynes. As Charles Rist explains:
It is said that history repeats itself. One can say the same thing about economists. At the present time there is a writer whose ideas have been repeated since Keynes, without ever being cited by name. He is called John Law. I would be curious to know how many, among the Anglo-Saxon authors who have found again, all by themselves, his principal arguments, have taken the trouble to read him.
--Douglas E. French, Early Speculative Bubbles and Increases in the Supply of Money, 2nd ed. (Auburn, AL: Ludwig von Mises Institute, 2009), 3.


No comments:

Post a Comment