The Precautionary Principle: A High-Risk Principle

The precautionary principle – recently added to the French constitution and part of the draft Constitution of the European Union – aims to protect the public from the risks associated with scientific and technological advance by allowing governments to ban any activity deemed to involve risks, even if those risks are unproven. In reality, the precautionary principle itself poses enormous risks of losing the advantages of projects that are banned, of preventing the development of the means by which risk may be ameliorated and of threatening the private property rights that provide the most effective environmental safeguard.

Some Fundamental Problems with Thomas Piketty’s «Capital in the Twenty-First Century»

The overall conclusion of this study is that a market economy based on private property, if left to itself, contains powerful forces of convergence, associated in particular with the diffusion of knowledge and skills; but it also contains powerful forces of divergence, which are potentially threatening to democratic societies and to the values of social justice on which they are based. The principal destabilizing force has to do with the fact that the private rate of return on capital, r, can be significandy higher for long periods of time than the rate of growth of income and output, g. The inequality r> g implies that wealth accumulated in the past grows more rapidly than output and wages. This inequality expresses a fundamental logical contradiction.(Piketty 2014, 571)

Hayek Did Not Embrace a Universal Basic Income

The classical focused Austrian liberal on the economist thinkers study of of Friedrich the economics twentieth Hayek (especially century. was one After until of a the first the most intellectual mid-outstanding 1940s), stage he classical liberal thinkers of the twentieth century. After a first intellectual stage focused on the study of economics (especially until the mid-1940s), he devoted the second stage of his intellectual life to other fields of social sciences, including political philosophy. In several books, he analyzed how social institutions should be structured to safeguard individual liberty; especially notable are The Road to Serfdom ([1944] 2001), The Constitution of Liberty ([I960] 2011), and The Political Order of a Free People (1979), the third volume of Law, Legislation, and Liberty. Unlike other classical liberal thinkers (Nozick 1974; Rothbard 1982), Hayek did not limit himself to defending political institutions that …

Tiempos recios y final de época en América Latina: un balance del ciclo electoral 2017-2019

El período electoral 2017-2019 se ha convertido en un final de época para América
Latina y ha supuesto el arranque de una nueva era, por ahora con más incertidumbre que certezas. Vemos que en América Latina transitan tres fenómenos interconectados que se retroalimentan mutuamente: la crisis de la matriz productiva (menor crecimiento económico –ralentización– e incluso crisis) provoca un creciente malestar social que ha desembocado en una compleja gobernabilidad alimentada por la desafección ciudadana hacia los partidos, las instituciones y la clase política; en el terreno político, el período 2017-2019 ha gestado una Latinoamérica más fragmentada y heterogénea, ajena a giros hacia la derecha (como se preveía en 2017), del que emergen graves problemas de gobernabilidad –abundancia de gobiernos en minoría que conviven con legislativos fragmentados y estancamiento económico que alimenta malestar y contestación social–; y el desapego ciudadano, de larga data, se ha recrudecido al empeorar el entorno económico y se convierte en respuesta ante unos Estados ineficientes e incapaces de poner en marcha políticas públicas eficaces en seguridad, transporte, educación o sanidad, ni garantizar la transparencia en la lucha contra la corrupción.

A Free Market Bailout Alternative?

It has been more than 3 years since the collapse of the investment bank Lehman Brothers and the beginning of the Troubled Asset Relief Program. Most recently, the sovereign debt crisis in Europe has led to the bailout of the governments of Ireland, Portugal and Greece. A main reason behind these bailouts is to support European banks loaded with government bonds on their balance sheet. In this article we analyze the detrimental consequences of the public bailout in 2008 and argue that a free market alternative existed. The alternative of a private bailout outlined in this article, consisting of the conversion of liabilities into equity and a private capital increase, largely avoids the problems of a public bailout. Similarly, a public bailout of governments of the Eurozone to sustain banks may be detrimental.

Study of the effects on employement of public aid to renewable energy sources

Economic crisis has raised the topic of whether governments should control the economy in order to promote prosperity and create jobs. This idea has specially sprung in relation to the promotion of entire productive sectors which are considered strategic or high-value by planners, one of which is renewable energies. This article analyzes the Spanish experience on subsidizing wind, mini-hydroelectric and photovoltaic energies in order to foster growth and create so-called «green jobs». Results suggest that more jobs are destroyed than those that initially were intended to be created.