Hayek on a Pre-Announced “Total Income Stream”

Hayek’s version of “NGDP targeting”, from 1975:

“The moment there is any sign that the total income stream may actually shrink, I should certainly not only try everything in my power to prevent it from dwindling, but I should announce beforehand that I would do so in the event the problem arose.”*

The view echoes Hayek positions and arguments from the 1920 & 1930s.

Hayek may be winning another one.

“The moment there is any sign that the total income stream may actually shrink [during a post-bust deflationary crash], I should certainly not only try everything in my power to prevent it from dwindling, but I should announce beforehand that I would do so in the event the problem arose.”

*UPDATE: The quote from F. A. Hayek was made in reply to a question from his old friend Gottfried Haberler in a talk given at the American Enterprise Institute in 1975.

This entry was posted in Tweets. Bookmark the permalink.

7 Responses to Hayek on a Pre-Announced “Total Income Stream”

  1. Nick Rowe says:

    Aha! Tell us more!

    I take it that it’s clear from the context Hayek is talking about the flow of *nominal* income?

    What was the 1978 book/article/speech?

  2. Brian Caplan once made a great point when he said something to the effect of: “Lots of things Hayekians credit Hayek with are ‘the sky is blue’ statements. Where, no matter where the idea comes from, if Hayek said it Hayekians claim the idea as their own.”

    http://econlog.econlib.org/archives/2009/10/hayek_said_the.html

  3. Becky Hargrove says:

    If indeed he felt that way in the middle of hyperinflation – that is significant. But admittedly I need a bit more historical context.

  4. Greg Ransom says:

    Greg Ransom once made the great point that Brian Caplan in an embarrassment on the topic of Hayek and his work ….

  5. marris says:

    @Greg Please cite your sources!!!! :-)

  6. Greg Ransom says:

    Marris — I am my source. This is a quote I’ve posted many times, and I pulled it from my blog. The original source can be found using Google, entering the text of the quote. The original source is in my files, and the quote comes in the q & after a talk by Hayek at the AEI in 1975.

  7. Pingback: Don’t You Dare Show Scott Sumner This Rothbard Excerpt

Comments are closed.