The Answer Is Transaction Costs
"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.....
Episodes
59 episodes
Second Place Is The First Loser: Strategy Over Speed
The ancient tradition of Il Palio in Siena showcases a complex system of strategic corruption, neighborhood rivalries, and high-stakes horse racing that has endured for centuries. This 90-second race around Siena's central piazza involves exten...
•
42:22
When Bats Attack: Understanding Insurance
Mike Munger explores insurance economics through the lens of transaction costs and risk management, culminating in an amusing case study about "bat-in-mouth disease."Insurance transfers risk from individuals to larger pools,...
•
Season 3
•
Episode 10
•
35:09
Adam Smith's Wealth of Nations: Episode #2--The "Model"
Transaction costs provide the key to understanding Adam Smith's complete philosophical system and how his two great works form an integrated whole. • Smith's two essential claims: humans desire to learn proper behavior and have an ...
•
Season 3
•
Episode 9
•
57:13
Adam Smith's Wealth of Nations: Episode 1 (Background)
(N.B.: This episode is cross-posted at our partner site, Adam Smith Works. There are lots of resou...
•
Season 3
•
Episode 8
•
57:21
Nnnnooooo one expects transaction costs!! The economics of Monty Python
Mike Munger explores how Monty Python brilliantly illustrated transaction cost economics through their legendary comedy sketches. The British comedy troupe's most famous routines provide perfect, hilarious examples of the frictions that make ec...
•
Season 3
•
Episode 7
•
16:47
The Engineers of Exchange: Middlemen, Part Deux
Middlemen are not parasites but essential "engineers of exchange" who create value by connecting buyers and sellers who might never find each other otherwise.• The word "monger" (and Munger) comes from a Saxon root--Mancgere-- meaning t...
•
16:25
FA Hayek: Price Whisperer
The price system solves a profound coordination problem by communicating dispersed knowledge that no central planner could ever fully access or comprehend. We explore Hayek's insight about how prices serve as both information and incentives, al...
•
18:47
The Price of Pennies: Make or Buy?
The make-or-buy decision is a fundamental aspect of economics that applies to businesses, households, and nations, with the U.S. penny providing a fascinating case study in economic inefficiency.• It costs 2.72 cents to manufacture one ...
•
Season 3
•
Episode 4
•
19:20
Pretty Pigs and Talking Dogs
How should we decide which political-economic systems are best for organizing society? Let's peer through the lens of the "Pretty Pig Problem," which highlights the flaws in comparing the actual implementation of systems we dislike with idealiz...
•
11:01
Barking Cats: On the "Nature" of Bureaucracy
Transaction costs are the friction in the gears of society, but the worst transaction costs are the ones that reflect government failure. You can see it in ever cliche about government, from the dreaded DMV lines to the passport control bottlen...
•
21:06
Pins: Division of Labor is Limited by Transaction Costs
Adam Smith's pin factory example from "The Wealth of Nations" demonstrates how dividing labor into specialized tasks dramatically increases productivity. Ten workers specializing in different aspects of pin-making could produce 48,000 pins dail...
•
22:32
Commerce and Sociology: Novak on Entangled Political Economy
What happens when we stop seeing politics and markets as separate spheres and start recognizing their deep entanglement? Mikayla Novak, senior fellow at the Mercatus Center, challenges conventional economic thinking in favor of Dick Wager's "en...
•
1:20:55
The Paradox of Political Rationality: Lynch
Why do harmful policies like tariffs keep coming back despite universal condemnation from economists? The answer lies in the dynamics of collective action and concentrated interests.In this eye-opening conversation with G. Patrick Lynch...
•
Season 2
•
Episode 21
•
1:08:00
Curation Bubbles, Verification, and the Splintering of Ideology: Green
What happens when we no longer consume scarce information through trusted, verified institutions, but instead through an abundance of unbundled content without context or curation? John Green, rising star in political science from Duke Universi...
•
Season 2
•
Episode 20
•
56:55
The Socialist Generation Debate: Boettke
Join economist Peter Boettke as he discusses how transaction costs impact market efficiency and our everyday decisions. We delve deep into historical examples, particularly the Soviet Union, to highlight the consequences of centralized pl...
•
1:05:12
Transaction Costs and Constitutions: India's Balancing Act, with Shruti Rajagopalan
What if transaction costs could shape entire political and economic systems? Join us for an insightful discussion with Shruti Rajagopalan, a senior research fellow at the Mercatus Center, as she takes us through her fascinating journey from the...
•
1:03:51
Political Capitalism and the Power of Elites: Randall Holcombe
This episode explores the intersection of democracy and capitalism, focusing on the concept of political capitalism and its relation to cronyism. Randall Holcomb discusses transaction costs, charismatic leadership, and critiques the idea that d...
•
1:02:16
Prison Gangs and Governance: David Skarbek
Curious about how the world of prison economics operates? Get ready to uncover a hidden universe with our guest, David Skarbek, a leading voice in political economy. David takes us on a captivating journey from his early days in construction to...
•
Season 2
•
Episode 41
•
1:01:27
Certainty, Common Law, and Statutory Law: Todd Zywicki of Scalia Law
Todd Zywicky, professor at George Mason's Scalia Law School, challenges some conventional legal doctrine, taking up the views of Bruno Leone and Friedrich Hayek. What if the legal world has underestimated the power of spontaneous order? Todd's ...
•
53:20
From Law to Legislation: A Natural Process
Have you ever wondered how common law rules and market prices both "emerge"? Inspired by the works of James Buchanan, F.A. Hayek, and Bruno Leoni, Donald Boudreaux explains how decentralized processes can lead to the emergence of effective norm...
•
Season 2
•
Episode 12
•
54:31
Why Bosses Don't Wear Bunny Slippers: TAITC
Ever wondered why firms exist in a market-driven economy? This month's episode promises to unravel this question by diving deep into Ronald Coase's seminal 1937 paper, "The Nature of the Firm." Join me, Mike Munger, as I reflect on our first 16...
•
23:09
Price Gouging or Price Information?
Can high prices during emergencies actually save lives? Using North Carolina as an example, we dissect the economic and legal implications of these laws, exploring the ambiguities in terms like "unreasonably excessive" and the chilling ef...
•
18:17
All Housing is Affordable Housing
Are housing regulations making affordable homes a pipe dream? We promise you'll gain a deeper understanding of how transaction costs and regulatory hurdles impede new housing development, frustrating both market responses and the dreams of pote...
•
Season 2
•
Episode 11
•
24:29