Economics Dictionary of ArgumentsHome
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| Hoarding: Hoarding in economics is the practice of acquiring and holding a large quantity of a commodity or asset with the intention of profiting from future price increases. This can lead to artificial scarcity and higher prices for consumers. See also Time preference, Consumption, Money supply, Demand for money._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
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Murray N. Rothbard on Hoarding (Economics) - Dictionary of Arguments
Rothbard III 775 Hoarding/money/Rothbard: The very word "hoarding" is a most inappropriate one to use in economics, since it is laden with connotations of vicious antisocial action. But there is nothing at all antisocial about either "hoarding" or "dishoarding." "Hoarding" is simply an increase in the demand for money, and the result of this change in valuations is that People get what they desire, i.e., an increase in the real value of their cash balances and of the monetary unit.(1) Conversely, if the People desire a Iowering of their real cash balances or in the value of the monetary unit, they may accomplish this through "dishoarding." No other significant economic relation - real income, capital structure, etc. - need be changed at all. Rothbard III 776 DefinabilityVsHoarding: (…) there is no theoretical way of defining "hoarding" beyond a simple addition to one's cash balance in a certain period of time. Yet most writers use the term in a normative fashion, implying that there is some vague standard below which a cash balance is legitimate and above which it is antisocial and vicious. But any quantitative limit set on the demand-for-money schedule would be completely arbitrary and unwarranted. >Keynesianism/Rothbard, >Keynesianism, >Quantity theory, >Consumption function. Rothbard III 778 KeynesianismVsHording: Keynesian law: The Keynesian law asserts social expenditures to be Iower than social income above point A, and higher than social income below point A, so that A will be the equilibrium point for social income to equal expenditure. For if social income is higher than A, social expenditures will be Iower than income, and income will therefore tend to decline from one day to the next until the equilibrium point A is reached. If social income is Iower than A, dishoarding will occur, expenditures will be higher than income, until finally A is reached again. RothbardVsKeynes/RothbardVsKeynesianism: (…) suppose that we now grant the validity of such a law; the only comment can be an impertinent: So what? What if there is a fall in the national income? Since the fall need only be in money terms, and real income, real capital, etc., may remain the same, Why any alarm? The only change is that the hoarders have accomplished their objective of increasing their real cash balances and increasing the real value of the monetary unit. It is true that the picture is rather more complex for the transition process until equilibrium is reached, (…) But the Keynesian system attempts to establish the perniciousness of the equilibrium position, and this it cannot do. 1. See the excellent article by W.H. Hutt, “The Significance of Price Flexibility” in Hazlitt, Critics of Keynseian Economics, pp. 383-406._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Rothbard II Murray N. Rothbard Classical Economics. An Austrian Perspective on the History of Economic Thought. Cheltenham, UK: Edward Elgar Publishing. Cheltenham 1995 Rothbard III Murray N. Rothbard Man, Economy and State with Power and Market. Study Edition Auburn, Alabama 1962, 1970, 2009 Rothbard IV Murray N. Rothbard The Essential von Mises Auburn, Alabama 1988 Rothbard V Murray N. Rothbard Power and Market: Government and the Economy Kansas City 1977 |
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