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" "The social sciences building at the University of Chicago indeed still bears since it was built 40 years ago on its outside an inscription taken from the famous physicist Lord Kelvin: "When you cannot measure, your knowledge is meager and unsatisfactory." I will admit that that may be true, but it is certainly not scientific to insist on measurement where you don't know what your measurements mean. There are cases where measurements are not relevant. What has done much damage to microeconomics is striving for a pseudo-exactness by imitating methods of the physical sciences which have to deal with what are fundamentally much more simple phenomena. And the assumption that it is possible to ascertain all the relevant particular facts still completely dominates the alternative methods of dealing with our constitutional ignorance, which economists have tried to overcome. This of course, is what has come to be called macroeconomics as distinct from microeconomics.
Friedrich August von Hayek CH (8 May 1899 – 23 March 1992) was an Austrian, later British, economist and philosopher best known for his defense of classical liberalism. In 1974, Hayek shared the (with Gunnar Myrdal) for his "pioneering work in the theory of money and economic fluctuations and … penetrating analysis of the interdependence of economic, social and institutional phenomena". (Nobel Memorial Prize, 1974)
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The reasons why the adoption of a system of central planning necessarily produces a totalitarian system are fairly simple. Whoever controls the means must decide which ends they are to serve. As under modern conditions control of economic activity means control of the material means for practically all our ends, it means control over nearly all our activities. The nature of the detailed scale of values which must guide the planning makes it impossible that it should be determined by anything like democratic means. The director of the planned system would have to impose his scale of values, his hierarchy of ends, which, if it is to be sufficient to determine the plan, must include a definite order of rank in which the status of each person is laid down. If the plan is to succeed or the planner to appear successful, the people must be made to believe that the objectives chosen are the right ones. Every criticism of the plan or the ideology underlying it must be treated as sabotage. There can be no freedom of thought, no freedom of the Press, where it is necessary that everything should be governed by a single system of thought. In theory Socialism may wish to enhance freedom, but in practice every kind of collectivism consistently carried thought must produce the characteristic features which Fascism, Nazism, and Communism have in common. Totalitarianism is nothing but consistent collectivism, the ruthless execution of the principle that 'the whole comes before the individual' and the direction of all members of society by a single will supposed to represent the 'whole'.
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Our basic problem is that we have three levels, I would say, of moral beliefs. We have the first instance, our intuitive moral feelings which are adapted to the small, person-to-person society where we act for people whom we know and are served by people whom we know. Then, we have a society governed by moral traditions which, unlike what modern rationalists believe, are not intellectual discoveries of men who designed them, but as a result of a persons, which I now prefer to describe as term of 'group selection.' Those groups who had accidentally developed such as the tradition of private property and the family who did succeed, but never understood this. So we owe our present extended order of human cooperation very largely to a moral tradition which the intellectual does not approve of, because it has never been intellectually designed and it has to compete with a third level of moral beliefs, those which the morals which the intellectuals designed in the hope that they can better satisfy man's instincts than the traditional morals to do. And we live in a world where three moral traditions are in constant conflict, the innate ones, the traditional ones, and the intellectually designed ones, and ultimately, all our political conflicts of this time can be reduced as affected by a conflict between free moral tradition of a different nature, not only of different content.