Volume 4, Issue 1

Hume's contribution to modern economics is normally thought of in terms of his early statement of the quantity theory of money, and to a lesser extent his views on trade and development. At a methodological level the influence from his empiricism is commonly traced to the development of econometrics. But if we explore his philosophy more fully, we find a much richer set of ideas which can illuminate the way we approach issues in modern economics. Here therefore we explore Hume's theory of human nature and his theory of knowledge in order to understand how he viewed economic behaviour as inherently bound up in other aspects of life. From this follows a perspective on the relations between economics and other disciplines (notably history, sociology and psychology) which may inform current explorations of these relations. This reading of Hume's approach to economics is illustrated by revisiting his theories of money and growth, and his approach to empiricism. Hume holds the potential for a much richer contribution to modern economics than is normally understood.

Freud supposedly said that Nietzsche knew himself better than anyone who ever lived or is likely to live in the future. If the story is true, it's one of the best compliments of all time. Yet Nietzsche's psychological theories remain largely unknown to psychologists, philosophers and certainly to economists. These theories, taken together, constitute a profound attack on the foundations of neoclassical models in which individuals maximize the discounted flow of gratification they expect to receive. Scattered through Nietzsche's writings, we can find an alternative description of intertemporal choice motivated by overcoming obstacles. A principal objective of this paper is to show how Nietzsche's theory of overcoming can explain a great deal of observable behavior and solve important problems in economics.