Skip to main content

Armen Alchian

Armen Alchian passed away two days ago aged 98.  Obituaries are available here and here. Below is a short video clip of Alchian talking about property rights.

Alchian was a brilliant economist who inspired several generations of economists, including Nobel prize winners. His papers are amongst some of the most cited in economics. Alchian should have won the Nobel prize in economics as his insights into property rights, inflation, money, economic organisation, the theory of the firm, and the biological approach to economics were all path-breaking. Alchian did the first event study analysis in corporate finance, but it remained a secret for four decades as it pertained to matters of national security - click here to read more.
 
If you read Alchian's papers, you will see that he had the knack of making the dismal science interesting, and his stress was on economic intuition rather than mathematical elegance. His book, Economic Forces at Work, is a must read for all serious thinkers about the economy.
 
 

Popular posts from this blog

The Failure of Herstatt Bank

As an undergraduate, I was taught about the failure of Herstatt Bank in 1974 and Herstatt risk. This bank was only the 35th largest bank in Germany at the time so why would anyone be interested in studying its failure? Herstatt failed because of its involvement in risky foreign exchange business. When it closed its doors on 26 June 1974, counterparty banks (mainly in New York) had not received dollars due to them because of time-zone differences - this is known as settlement risk. The cross-jurisdictional implications of its failure resulted in the Bank for International Settlements setting up the Basel Committee on Banking Supervision and Herstatt's failure was a key reason for the establishment of real-time gross settlements systems, which ensures that payments between two banks are executed in real time. The Bank of England's Ben Norman has an interesting post on Herstatt over at the Bank's new blog ( Bank Underground ). As well as giving an excellent overview of

Boom and Bust: A Global History of Financial Bubbles

Boom and Bust: A Global History of Financial Bubbles, co-authored with my colleague Will Quinn , is forthcoming in August. It is published by Cambridge University Press and is available for pre-order at Amazon , Barnes and Noble , Waterstones and Cambridge University Press . 

The Great Depression

Marginal Revolution University has a great video on the Great Depression.