Competition as a process – Econlib

In a one-day conversation session with Harold Demsetz, moderator Harry de Angelo asked Joe Cult, Bob Topel and me to remind him about Harold as a person and his contribution to us and the economy.

In response to a question from Harry de Angelo (3:07:00 point,) Joe Cult replied that Harold saw competition as a process, not as a balance. I totally agree.

Although I would like to add two points. First, I get more of that perspective from Ben Klein’s Art Company class than from Harold. The second point is why Ken Elzinga of the University of Virginia told me in a side-conversation after that session: That is, although it is true that Harold pushed that view, economists are to be credited with being Austrian economists. I’m thinking of Harold’s contemporaries here, such as Israel Kirzner. But you can also find it in previous works of the Austrians. Joseph Schumpeter, who was Austrian but sometimes not considered a member of the Austrian school, beautifully portrayed the scene. Capitalism, socialism and democracy. But you can also find the idea in Carl Menger’s work of the late 19th century.

Incidentally, if I think correctly, Ben Klein bought us Israel Kirzner Competition and Entrepreneurship, A book where Kirzner outlines the perspective of competition as a process. Ben was very hung up on that book.

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