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The Answer Is Transaction CostsAuthor: Michael Munger
"The real price of everything is the toil and trouble of acquiring it." -Adam Smith (WoN, Bk I, Chapter 5)In which the Knower of Important Things shows how transaction costs explain literally everything. Plus TWEJ, and answers to letters.If YOU have questions, submit them to our email at taitc.email@gmail.com There are two kinds of episodes here: 1. For the most part, episodes June-August are weekly, short (<20 mins), and address a few topics. 2. Episodes September-May are longer (1 hour), and monthly, with an interview with a guest.Finally, a quick note: This podcast is NOT for Stacy Hockett. He wanted you to know that..... Language: en-us Genres: News, Politics, Science, Social Sciences Contact email: Get it Feed URL: Get it iTunes ID: Get it |
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Adam Smith Episode 7: The Errors of Mercantilism--Bullion, Balances, and Bounties
Tuesday, 25 November, 2025
Send us a textTracing out Adam Smith’s Book IV, chapters 1–6, to show how mercantilism mistakes money for wealth, how protection creates monopolies at home, and why free exchange raises real prosperity. Smith defends two narrow exceptions—defense and tax parity—while rejecting bounties and politicized treaties that entangle trade with war.• mercantile vs physiocratic systems and their influence• wealth as goods and industry, not specie• balance of trade as a “pestilent error”• make-or-buy logic and misallocation from tariffs• invisible hand clarified and limited• natural vs acquired advantages in specialization• two exceptions: national defense and tax parity on imports• drawbacks as refunds vs bounties as subsidies• corn bounties, higher home prices, cheaper foreign prices• specie hoards as dams that inevitably overflow• treaties of commerce, Methuen example, political risk• case for unilateral free trade over reciprocityMentioned in the podcast:Laura Williams on PineapplesPineapples in SwedenOren Cass on Adam SmithDan Klein's Law and Liberty piece on Oren Cass on Adam SmithIf you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com ! You can follow Mike Munger on Twitter at @mungowitz
