Production, commerce, and predation, 12/1
Meir Kohn's attempt to re-orient economics
In the absence of obstacles, economic progress should continue unabated.
…Obstacles, unfortunately, are not absent: the most important obstacle is predation. And the principal source of predation is governments. Indeed government can best be understood in terms of predation. Government is an organization created to deploy force—either for the purpose of predation (predatory government) or to protect a population against predation (associational government).
commerce and predation, no less than production, [are] full‐fledged economic activities—as ways people make a living. It is commerce that lies behind “the market” of conventional economic theory: the formation of prices and the allocation of resources are consequences of this economic activity. Similarly, as we have seen, it is the economic activity of predation that explains the existence of government, what it does, and how it evolves.
He argues that looking at commerce and predation together with production, rather than production alone, can illuminate important economic phenomena, especially economic growth and the lack thereof. He is working on a book, from which the linked article is adapted.
I'm a big fan of Kohn's work. His critique of conventional economics is spot on. I see Kling's PSST as another member of this club,
"Examples include the new institutional economics, transactions cost economics, public choice theory, and Austrian economics. Such attempts to go beyond conventional theory have been handicapped, however, by the lack of an overall theoretical framework into which they all fit. This limits the development of each by confining it to its own ghetto, outside the mainstream."
Will Kohn's "Production, Commerce, and Predation" framework supercede conventional economics? It certainly seems implausible at present given the incentive structure of academia.
That said, at some point it will become increasingly embarrassing that conventional economics, including atheoretical econometrics, ignores the biggest questions. Easterly and Pritchett have both criticized the "Randomista" takeover of development economics. Ignoring predation in, say, African economic development is insane.
As much as I respect PSST (way better than conventional economics or Austrian), it strikes me that PSST might be regarded as a subset of Kohn's "Production, Commerce, and Predation" along with the others he lists. NIE is valuable as a whole but a mess as a theoretical construct. Transaction cost economics is neater but not as comprehensive as Kohn. Public choice (and public ignorance) are critical and yet largely ignored by the mainstream economic establishment because of the lens of conventional economics. Austrian is invaluable on entrepreneurial change but some rigid advocates of the Austrian business cycle theory, along with some hard ideological advocates, will limit adoption.
Setting aside the challenge of institutional incentives against the adoption of Kohn's framework, speaking strictly from the perspective of a more comprehensive theoretical lens for economics, what is your case against the adoption of Kohn's framework?
This is a proposition to which no economic historian worth his or her salt would assent. The role of the state not only in protecting property and providing the rule of law, but in providing infrastructure and later in welfare measures that insulate the population from shocks, natural and man-made, and hence providing legitimacy, has been fundamental in the history of capitalism. In short, Kohn's position is one grounded in abstract libertarian ideology, with no appeal beyond such precincts.