Episode #117: Interview with David Friedman, Anarchist, Anachronist, Economist

About Our Guest

Ron and Ed are thrilled to have as a Guest this week, the self described anarchist-anachronist-economist David Friedman

David is an American economist, physicist, legal scholar, and libertarian theorist. He is known for his writings in market anarchist theory, which is the subject of his most popular book, The Machinery of Freedom.

He has an active blog at which he opines about everything from medieval recipes to global warming. 

Segment One: Ed’s Questions

What are your thoughts on the election?

Would President Obama pardon Hillary Clinton, even though she hasn’t been convicted of anything? Is there precedent in any legal system for a pre-emptive pardon?

Should we transfer the pardon power to Congress?

Segment Two: Ron’s Questions

In Hidden Order: The Economics of Everyday Life, 1996, you discuss the assumption of rationality. It’s false, but useful. It describes our actions, not our thoughts.

Why do economists hold on to the assumption of rationality?

You haven’t seen any major advances because of behavioral economics?

Price discrimination. What are the welfare benefits of price discrimination?

Segment Three: Ed’s Questions

The market is often blamed for inequality, but you point out that often times it is government that is more unequal to the poor. Could you give us an example or two?

You’ve written on public-key encryption, is blockchain and Bitcoin a manifestation of that?

Question from Jay, one of our listeners: Who or what led you to your anarchism?

Segment Four: Ron’s Questions

In Law’s Order, you point out that the death penalty is irreversible, but so is prison time. And since prison has to be imposed at a higher probability to get same deterrent effect, there will be proportionally more mistakes with imprisonment than the death penalty.

You have a PhD in physics. What’s your view of Global Warming?

Are you concerned about the declining population in some countries, such as Europe, Japan, etc.?

Three times as many disagreements each year among eBay traders are resolved using its online dispute resolution system than there are lawsuits filed in the entire US court system. Might this be an example of some of the ideas in The Machinery of Freedom being implemented?

Illustrated Summary of Machinery of Freedom

Comment

Ed Kless

Ed Kless joined Sage in July of 2003 and is currently the senior director of partner development and strategy. He develops and delivers curriculum for Sage business partners on the art and practice of small business consulting. Courses include: Sage Consulting Academy, Business Strategy and Customer Experience Workshops. Ed is the author of The Soul of Enterprise: Dialogues on Business in the Knowledge Economy, a compendium of a few of the episodes of his VoiceAmerica talk-show The Soul of Enterprise: Business in the Knowledge Economy with Ron Baker, founder of the VeraSage Institute where Ed is also a senior fellow.