Presented by Murray N. Rothbard in 1986 at New York Polytechnic University. Recorded by Hans-Hermann Hoppe.
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1. Intro to Micro: Demand and Supply
Microeconomics is concerned with the actions of individuals. The focus of macroeconomics is entire sectors of the economy.
Why is it that things like bread and water which have high use values are cheap while on the other hand luxury items like diamonds are very expensive? This paradox was not solved until it became understood that people choose only a marginal unit - this loaf or this diamond.
3. The Determination of Prices
Price is determined by the equilibrium price and the equilibrium quantity. If your good is not selling, you lower the price. If your goods fly off the shelves you are selling too cheaply and you raise prices.
4. Price Controls in the Oil Industry
The disappearance of oil has been forecast every decade. Prices were overlooked. When the price is high it is more profitable to look for oil. Total reserves on the ground are higher than they were in 1890.
5. Minimum Price Controls
Thou shalt not sell a certain product or service below a certain price, e.g. wheat, cotton, corn, cheese, sugar. This will result in an artificial unsold permanent surplus, as it does in the American farm situation.
6. Government Licensing of Industry and Minimum Wage
The peanut butter crunch was in 1980. Crop acreage and production was cut down by 45% by government price support, import quotas, and cartelizing of the industry. The price of peanuts more than tripled.