Armen Alchian Quotes

8 Sourced Quotes

Where foresight is uncertain, profit maximization is meaningless as a guide to specifiable action.

Armen Alchian
It is a general prevalence of double coincidence of information rather than wants by both parties that would avoid the use of money.

Armen Alchian
By this I refer to the fact that at the same time several people may each possess some portion of the rights to use the land. A may possess the right to grow wheat on it. B may possess the right to walk across it. C may possess the right to dump ashes and smoke on it. D may possess the right to fly an airplane over it. E may have the right to subject it to vibrations consequent to the use of some neighboring equipment. And each of these rights may be transferable. In sum, private property rights to various partitioned uses of land are "owned" by different persons.

Armen Alchian
The rights of individuals to the use of resources (i.e., property rights) in any society are to be construed as supported by the force of etiquette, social custom, ostracism, and formal legally enacted laws supported by the states' power of violence of punishment. Many of the constraints on the use of what we call private property involve the force of etiquette and social ostracism. The level of noise, the kind of clothes we wear, our intrusion on other people's privacy are restricted not merely by laws backed by police force, but by social acceptance, reciprocity, and voluntary social ostracism for violators of accepted codes of conduct.

Armen Alchian
Neither perfect knowledge of the past nor complete awareness of the current state of the arts gives sufficient foresight to indicate profitable action. Even for this more restricted objective, the pervasive effects of uncertainty prevent the ascertainment of actions which are supposed to be optimal in achieving profits. Now the consequence of this is that modes of behavior replace optimum equilibrium conditions as guiding rules of action. Therefore, in the following sections two forms of conscious adaptive behavior are emphasized.

Armen Alchian
The greater the uncertainties of the world, the greater is the possibility that profits would go to venturesome and lucky rather than to logical, careful, fact-gathering individuals.

Armen Alchian
Alchian: Perhaps it might have been more appropriate for the Nobel Prize to have gone to you and Hicks together, and [Kenneth] Arrow and [Gunnar] Myrdal together.
Hayek: Oh, surely. [laughter]

Armen Alchian
Like the biologist, the economist predicts the effects of environmental changes on the surviving class of living organisms; the economist need not assume that each participant is aware of, or acts according to, his cost and demand situation.

Armen Alchian