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IPFS News Link • Philosophy: Libertarianism

The Mystery of Peter Theil, Ron Paul's Biggest Backer

• economicpolicyjournal.com

In the book, Theil discuses booms and busts that have occurred in Silicon Valley, but not once does he link the booms and busts to Federal Reserve money printing activities. It seems almost as though in Theil's view that the booms and busts are simply  deus ex machina events without connection to economic cause and effect. 

In a chapter titled, All Happy Companies Are Different, he argues from the neoclassical framework of pure competition and monopoly. A framework that was soundly critiqued by the Austrian school economists Ludwig von Mises, Friedrich Hayek and Murray Rothbard.

In the chapter, Theil doesn't appear to be completely satisfied with the neoclassical perspective on monopoly, but he gives no indication that he is aware if the criticisms made by Mises, Hayek and Rothbard.

When he discusses entrepreneurship, he links entrepreneurship in Schumpeterian fashion solely with technology advances.  He seems to have no awareness of the critique of this approach by Austrian school economists such as Murray Rothbard who wrote:

Under the stimulus of the late Professor Schumpeter, it has been thought that the essence of entrepreneurship is innovation the disturbance of peaceful, unchanging business routine by bold innovators who institute new methods and develop new products. There is, of course, no denying the importance of the discovery and institution of more productive methods of obtaining a product or of the development of valuable new
products. Analytically, however, there is danger of overrating the importance of this process. For innovation is only one of the activities performed by the entrepreneur. As we have seen above, most entrepreneurs are not innovators, but are in the process of investing capital within a large framework of available technological opportunities. Supply of product is limited by supply of capital goods rather than by available technological know-how.  

Entrepreneurial activities are derived from the presence of
uncertainty. The entrepreneur is an adjuster of the discrepancies
of the market toward greater satisfaction of the desires of the
consumers.

Theil hails the advances of Silicon Valley, but fails to notice the enormous restrictions placed by government on money raising efforts that provide an enormous edge to the big dollar funders in the valley, who can hire the lawyers to get around the restrictions.


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