I start the countdown by selecting Israel Kirzner as my 10th favorite thinker. I do not think that he is right about everything, but it is hard to overestimate his ability to make the reader (i.e. me) think.
When I first read his most well-known book, Competition and Entrepreneurship, it was akin to a revelation. My vague dissatisfaction with mainstream theory seemed explained and solved: the source of the problem is that there is no entrepreneur in contemporary neoclassicism, because end-state equilibria assume that the entrepreneurial problem has already been solved.
This had the effect of making me a downright “Kirznerian” for a while (my paper “The Spatial Nature of Entrepreneurship” is almost as Kirznerian as Kirzner himself). But then I became increasingly skeptical, and in my later writings I have spent more time criticizing than defending Kirzner’s conception of entrepreneurial “alertness,” “discovery” and so on. But this does not mean than I don’t like his theory. I think we should all be grateful to Kirzner for having articulated an extraordinarily consistent, thin, and elegant theory.
The reason I call Kirzner a gateway to economic sanity is that he is sufficiently grounded in the neoclassical tradition to be taken seriously by the more open-minded of mainstream economists, yet he explains some of its most serious flaws in a way that is more likely to keep such economists reading than more heterodox or less polite critics of the received view. In other wirds, Kirzner’s work is a sort of “gateway drug” to the even more mind-altering substance of, say, “The Economics of Time and Ignorance” or “Knowledge, Institutions, and Evolution in Economics.”
Unfortunately, the neoclassical sponge has lately had a tendency to integrate the form of Kirzner’s theory while draining it of its substance. In the expansive field of “entrepreneurship studies,” Kirzner is often referred to but seldom understood. Contrary to superficial interpretations, Kirzner’s theory is not a theoretical foundation for empirical studies of small business formation, unless it’s understood that business formation is only a minor subset of profit-yielding human action.
An attractive aspect of Kirzner’s work is that he never emphasizes the policy implications of his theory, which are numerous. While these implications are largely pro-market of the classical liberal variety, policy advocacy never seems to be his main objective. He is first and foremost an economist, who will occasionally provide the reader with understated observations regarding the benefits of free markets, but it’s mostly left to the reader to draw their own conclusions. I think this style is much to be preferred over more passionate policy advocacy (I don’t mind passion, but I think someone who gets passionate about tax rates has got his priorities jumbled up; surely there are other things that should be more likely to excite the passions of homo sapiens).
Israel Kirzner has an interesting background. While he was born in London, he has lived in New York for many years. When listening to a recording of one of his lectures, I was struck by his unique brand of spoken English: an idiosyncratic mixture of British intonation and two types of American pronunciation (New York and standard American).
Another unusual aspect is that he is not only an economist; he is also an Orthodox rabbi and scholar. Indeed, one might even call his style of economic analysis “rabbinical.” And it is perhaps this other occupation that explains his relative lack of passion when he does discuss economic policy choices.
No comments:
Post a Comment