Abstract
The entire approach of neoclassical economics focuses on proving the existence, uniqueness, and stability of the general equilibrium system and its properties concerning welfare. Ever since, the resulting topological structure shaped the construction of the theories of the firm and consumer choice, in a way that the emergence of an excess demand function was consistent with the equilibrium. Thus, whenever the observation (theoretical or practical) does not fit in the aforementioned system, it is considered a “market failure.” This, besides being an abhorrent concept, gives rise to government intervention, which ultimately fosters the advance of socialism.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
References
Arrow, K., & Hahn, F. (1971). General Competitive Analysis. Holden-Day.
Barro, R., & Sala-I-Martin, X. (2004). Economic Growth. MIT Press.
Debreu, G. (1959). Theory of Value. Wiley.
Hayek, F. A. (1944). The Road to Serfdom. George Routledge & Sons LTD.
Laffont, J. J. (1988). Fundamentals of Public Economics. MIT Press.
Maddison, A. (2007). Contours of the World Economy. Editorial, Oxford University Press.
Malthus, T. (1798). An Essay on the Principle of Population. W. Pickering.
Mises, L. v. (1952). Planning for Freedom. Libertarian Press.
Romer, P. (1986). Increasing Returns and Long-Run Growth. Journal of Political Economy, 94 (5) (October), 1002, 1037.
Rothbard, M. N. (1962). Man, Economy, and State. William Volker Fund and D. Van Nostrand.
Smith, A. (1776). An Inquiry into the Nature and Causes of the Wealth of Nations. University of Chicago Press.
Solow, R. (1956). A Contribution to the Theory of Economic Growth. Quarterly Journal of Economics, 70(1), 65–94.
Solow, R. (1957). Technical Change and the Aggregate Production Function. The Review of Economics and Statistics, 39(3), 312–320.
Starr, R. (2011). General Equilibrium Theory: An Introduction. Cambridge University Press.
Usawa, H. (1961). Neutral Inventions and the Stability of Growth Equilibrium. Review of Economic Studies, 28(February), 117–124.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Additional information
I haven’t had the opportunity to meet Professor Jesús Huerta de Soto in person yet. However, I already feel part of the legion that recognizes him to be one of the great gladiators defending the ideas of liberty. I learnt about him through an act of spontaneous order. I had just published with some colleagues a book in which we introduced economic policy proposals that could prevent the collapse of the Argentinian system, and I was presenting the book at a radio show when a listener sent me some videos. They were recordings of a lesson in which the professor discussed how prices could be used as a mechanism to conveyinformation, and for coordination and economic adjustment, which in turn evidenced how socialism was inapplicable, since in the absence of private property, prices can’t be applied, leading to total chaos. I immediately became his follower. Years later, Unión Editorial published my book Unmasking the Keynesian Lie, which was accepted by Huerta de Soto himself for publication within the section he runs. And good things would not end there. One day, Professor Bagus invited me to give a lecture on Zoom as part of his course. I was discussing my involvement in politics when suddenly I perceived some turmoil in the Zoom meeting. I was surprised to see Professor Jesús Huerta de Soto, who had joined the meeting to greet me and congratulate me for the fight I am putting up in Argentina to leave behind more than one-hundred years of socialism. To this day, I struggle to find the words to describe how happy I was for his gesture, and how grateful I am for everything I have learnt from Professor Jesús Huerta de Soto.
Rights and permissions
Copyright information
© 2023 The Author(s), under exclusive license to Springer Nature Switzerland AG
About this chapter
Cite this chapter
Milei, J.G. (2023). Capitalism, Socialism, and the Neoclassical Trap. In: Howden, D., Bagus, P. (eds) The Emergence of a Tradition: Essays in Honor of Jesús Huerta de Soto, Volume II. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-031-17418-6_19
Download citation
DOI: https://doi.org/10.1007/978-3-031-17418-6_19
Published:
Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-031-17417-9
Online ISBN: 978-3-031-17418-6
eBook Packages: Economics and FinanceEconomics and Finance (R0)