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Bonus Quotation of the Day…

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… is from paragraph 4 of Chapter 4 [2] of David Ricardo’s 1817 magnum opusOn the Principles of Political Economy and Taxation [3]:

When we look to the markets of a large town, and observe how regularly they are supplied both with home and foreign commodities, in the quantity in which they are required, under all the circumstances of varying demand, arising from the caprice of taste, or a change in the amount of population, without often producing either the effects of a glut from a too abundant supply, or an enormously high price from the supply being unequal to the demand, we must confess that the principle which apportions capital to each trade in the precise amount that it is required, is more active than is generally supposed.

Market-determined prices are essential to this (today globe-spanning) spontaneously organized complexity.  This complexity – what Bastiat [4] identified as the marvel of Paris being fed daily through the (mostly) self-interested actions of tens of thousands of strangers, and without anyone designing or superintending the process – is a common and happy feature of modernity.  Indeed, this feature is so common and so happy that it is today taken for granted save by a relatively small handful of economists who realize just how remarkable and wondrous it is.

Unfortunately, that which is taken for granted inspires too little attention and wonder.  Too few people ponder this organized complexity with sufficient care to understand and to appreciate how it happens.  This lack of understanding, in turn, contributes to the acceptance of crackpot schemes – including, of course, protectionism and state-imposed controls on prices and wages – to ‘improve’ society.

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