Gresham's Law in Politics


Footnotes are always worth reading.  I recently came across a footnote in one of Hayek’s writings where he quotes Aristophanes, the Greek satirist and dramatist.  The quote suggests that Gresham’s Law (i.e., bad money drives out good) operates in politics as well as money.  Although Gresham’s Law may be wrong in the monetary arena (see Robert Mundell’s piece on this), casual observation would appear to support the notion that bad politicians drive out good! The quote from Aristophanes is as follows:

Oftentimes we have reflected on a similar abuse
In the choice of men for office, and of coins for common use,
For our old and standard pieces, valued and approved and tried,
Here among the Grecian nations, and in all the world besides,
Recognised in every realm for trusty stamp and pure assay,
Are rejected and abandoned for the thrash of yesterday,
For a vile adulterated issue, drossy, counterfeit and base,
Which the traffic of the city passes current in their place. 



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