Lecciones de Economía - 5ª - 15/10/2009

Introduction and Class Schedule

The speaker greets the audience and mentions that they will be discussing a visit to Salamanca. However, the visit needs to be postponed due to the speaker's travel from Madrid. They suggest rescheduling it for 6 PM.

Class Visit to Salamanca

• The speaker suggests postponing the visit to Salamanca due to their travel from Madrid.

• They propose rescheduling it for 6 PM.

Welcome and Reading Assignments

The speaker addresses the students of the master's program and reminds them about following the reading assignments as per the established schedule. They mention that it is October 15th and acknowledge Saint Teresa as today's saint.

Reading Assignments

• Students are reminded about the importance of completing reading assignments according to the established schedule.

• The specific pages assigned for today are 37 to 61 from "La Acción Humana" by Mises.

Missing Students Named Teresa

The speaker realizes that there are no students named Teresa in class, which disappoints them as they wanted to congratulate them.

Absence of Students Named Teresa

• The speaker expresses disappointment over not having any students named Teresa in class.

• They had intended to congratulate them on something.

Checking Reading Completion

The speaker asks if everyone has completed their assigned readings. One student mentions that they haven't measured their progress, but the speaker emphasizes the importance of keeping up with readings.

Completion of Assigned Readings

• The speaker asks if everyone has read pages 37 to 61 from "La Acción Humana."

• One student admits to not measuring their progress, but the speaker emphasizes the importance of completing the readings.

Additional Reading Assignments

The speaker announces that on Monday, everyone should bring "La Acción Humana" as they will be checking reading completion. They also mention that on the following Tuesday, they should bring materials related to socialism, economic calculation, and entrepreneurial function.

Upcoming Reading Assignments

• On Monday, students are required to bring "La Acción Humana" for a reading check.

• On the following Tuesday, materials related to socialism, economic calculation, and entrepreneurial function should be brought.

Importance of Properly Marked Books

The speaker notices that some students have brought "La Acción Humana" without proper highlighting or underlining. They express disappointment and dismiss those students from class for the day.

Proper Marking of Books

• Students who have brought "La Acción Humana" without proper highlighting or underlining are dismissed from class.

• The speaker emphasizes the importance of marking books correctly with colored markers.

Demonstrating Proper Underlining Technique

The speaker demonstrates how to properly underline using a ruler. They show an example of correct underlining with a photocopy in hand.

Proper Underlining Technique

• The speaker demonstrates how to underline correctly using a ruler.

• They emphasize the use of a photocopy while underlining.

Bringing Previously Underlined Books

The speaker asks if anyone has brought previously underlined copies of "La Acción Humana." They mention that it is not acceptable and encourage students to properly mark their own books.

Bringing Previously Underlined Books

• The speaker asks if anyone has brought previously underlined copies of "La Acción Humana."

• They state that it is not acceptable and encourage students to mark their own books.

Ordinal and Cardinal Value Comparisons

The speaker discusses the difference between ordinal and cardinal value comparisons. They mention that ordinal value comparisons are subjective and allow for ordering, while cardinal value comparisons involve numerical computations.

Ordinal and Cardinal Value Comparisons

• Ordinal value comparisons are subjective and involve ordering preferences.

• Cardinal value comparisons allow for numerical computations.

Connecting Subjective Valuations with Numerical Computations

The speaker explains that there is a bridge between subjective valuations (ordinal) and numerical computations (cardinal). This bridge is formed by the existence of free exchanges and money as institutions.

Bridge Between Subjective Valuations and Numerical Computations

• Free exchanges and money serve as institutions that connect subjective valuations with numerical computations.

• Through these institutions, market prices are determined, enabling economic calculations.

Impossibility of Socialism without Free Exchanges

The speaker mentions the impossibility of socialism when free exchanges are prevented. They explain how socialism blocks economic calculation due to the absence of market prices.

Impossibility of Socialism without Free Exchanges

• Socialism becomes impossible when free exchanges are prevented.

• Economic calculation is hindered in socialism due to the absence of market prices.

Detailed Explanation on Topic 3

The speaker announces that they will begin explaining topic 3 in detail, starting from page 9 of the program.

Explanation of Topic 3

• The speaker will provide a detailed explanation of topic 3, starting from page 9 of the program.

Chapter 3 - Function Entrepreneurship

In this section, the professor explains the importance of understanding the concept of function entrepreneurship and its role in economics. He also mentions that all topics covered in Chapter 3 will be included in the final exam.

Function Entrepreneurship and Uncertainty

• The function entrepreneurship is the foundation of the entire economics course.

• It is essential to understand function entrepreneurship as it is crucial for comprehending economics.

• Uncertainty is an inherent part of the future, but institutions help us deal with uncertainty.

• The professor emphasizes that he uses probability concepts based on individual cases rather than class probabilities.

Definition of Function Entrepreneurship

• Function entrepreneurship refers to our innate ability to identify profit opportunities in our environment and take action to benefit from them.

• This capacity involves being alert, perceptive, and creative.

• Humans have a unique ability to continuously discover and create new information about means and ends.

Kirzner's Perspective on Entrepreneurship

• Kirzner, an Austrian economist, specializes in the theory of function entrepreneurship.

• He was a disciple of Ludwig von Mises and dedicated his career to studying entrepreneurship.

• Kirzner's books are cited as references for further reading on entrepreneurship.

Creativity and Distinction from Animals

This section explores how creativity sets humans apart from animals. The professor shares an anecdote about Israel Kirzner's journey into economics.

Creativity as Innate Capacity

• Creativity involves being aware, discovering, appreciating, and creating something new in our minds.

• Humans possess an innate creative capacity that distinguishes them from animals.

• Unlike animals that act based on instinct, humans continuously create new information about means and ends.

Anecdote About Israel Kirzner

• Israel Kirzner, an economist and disciple of Ludwig von Mises, specialized in the theory of function entrepreneurship.

• The professor shares an anecdote about Kirzner's journey into economics.

• Kirzner fled from the Nazis to the United States and pursued studies at New York University.

• He initially intended to become an accountant but attended a seminar by Ludwig von Mises, which changed his career path.

Albert L. Meyer and Entrepreneurship

This section discusses Albert L. Meyer's perspective on entrepreneurship and his connection to Ludwig von Mises.

Albert L. Meyer's Work

• Albert L. Meyer is an Austrian economist who focused on entrepreneurship.

• He specialized in the theory of function entrepreneurship, similar to Kirzner.

• Meyer was a student of Ludwig von Mises and dedicated his career to studying entrepreneurship.

Connection to Ludwig von Mises

• Ludwig von Mises, author of the economics treatise being studied, had a significant influence on both Kirzner and Meyer.

• The professor mentions that he recently submitted proofs for the ninth edition of the book due to high demand from students.

The transcript provided does not cover all chapters or topics extensively.

Understanding the Term "Perspicaz" in Business

In this section, the speaker discusses the term "perspicaz" and its relevance to the business function. The speaker compares it to being alert and highlights its dynamic nature.

Definition of Perspicaz

• The term "perspicaz" refers to having sharp vision or a keen look that can see far and wide.

• It is related to being alert but carries a more dynamic connotation.

• The speaker translates it as "perspicacious" when translating works by Kirchner.

Historical Context of Being Alert

• The concept of being alert can be seen in historical examples such as watchtowers along the Mediterranean coast to spot pirate attacks.

• These watchtowers were called "atalayas" and were used by vigilantes to stay vigilant for incoming threats.

Speculator as an Entrepreneurial Term

• The term "especulador" (speculator) is often associated with negative connotations, implying hoarding goods to impoverish others.

• However, its origin comes from the Latin word "espécula," which referred to elevated towers used by ancient Romans as lookout points.

• Thus, being a speculator also captures the essence of an entrepreneur who is always alert and perspicacious.

The Role of Historians and Entrepreneurs

This section explores the similarities between historians and entrepreneurs in terms of their need for perspicacity. It also emphasizes that entrepreneurs are essentially creators.

Similarities Between Historians and Entrepreneurs

• Historians face complex historical data and must select relevant factors when interpreting events, requiring perspicacity.

• Similarly, entrepreneurs must anticipate future consumer preferences and needs through their ability to imagine possibilities like historians do with the past.

Entrepreneurs as Creators

• The speaker highlights that entrepreneurs are essentially creators.

• They have the capacity to come up with original and appealing ideas, whether in business or artistic fields.

• This creative aspect sets entrepreneurs apart from historians, who focus on organizing and interpreting existing historical data.

Historians and Entrepreneurs: A Different Perspective

This section provides an alternative perspective on historians and entrepreneurs, suggesting that they can adopt each other's approaches.

Viewing the Future like a Historian

• The speaker suggests that entrepreneurs can benefit from adopting a historian's perspective when looking into the future.

• By applying their ability to imagine possibilities, entrepreneurs can become successful by anticipating trends and consumer desires.

Viewing the Past like an Entrepreneur

• In turn, historians can benefit from adopting an entrepreneurial mindset when analyzing historical events.

• Just as entrepreneurs select relevant factors for their business decisions, historians can emphasize different causal factors in their interpretations without being necessarily incorrect.

Conclusion

The speaker concludes by summarizing the definitions of an entrepreneur and a historian. They highlight how both roles require perspicacity but differ in terms of creativity versus organization.

Definitions of Entrepreneur and Historian

• An entrepreneur is someone who looks into the future with the eyes of a historian, imagining possibilities and creating innovative solutions.

• A historian is someone who looks into the past with the eyes of an entrepreneur, selecting relevant factors to interpret historical events.

Timestamps may not be exact due to differences in transcription length.

Vamos ya

The speaker expresses the urgency to start and take action.

Starting with a sense of urgency

• The speaker emphasizes the need to begin immediately.

• Taking action is crucial for success.

El conocimiento empresarial

The importance of practical knowledge in achieving success is discussed.

Types of knowledge

• There are two types of knowledge: scientific and practical.

• Practical knowledge, specifically entrepreneurial knowledge, is more important for personal and societal success.

• Paradoxically, this type of knowledge is not taught or recognized until now.

Characteristics of entrepreneurial knowledge

1. Subjective and practical: It cannot be learned through formal education.

2. Privative: It is unique to individuals or groups.

3. Dispersed: It is spread out and not easily accessible.

4. Inarticulate: It cannot be formalized or expressed explicitly.

5. Tacit: It is implicit and gained through experience.

6. Transmissible: It can be communicated through complex market processes studied in economics.

La importancia del conocimiento empresarial

The significance of entrepreneurial knowledge in contrast to traditional education is highlighted.

Importance of entrepreneurial knowledge

• Entrepreneurial knowledge differs from formalized education provided by schools and universities.

• This type of knowledge is vital for achieving personal success and can only be transmitted through social processes.

Característica 1: Conocimiento subjetivo y práctico

The first characteristic of entrepreneurial knowledge, being subjective and practical, is explained.

Subjective and practical nature

• Entrepreneurial knowledge cannot be learned objectively or formally.

• It can only be acquired through practical experience in specific circumstances.

El conocimiento subjetivo y práctico

The speaker shares a personal anecdote to emphasize the limitations of formal education and the importance of subjective and practical knowledge.

Learning through practice

• Practical knowledge, such as entrepreneurial knowledge, cannot be obtained from books or formal education.

• It is acquired through hands-on experience and action.

• The speaker gives an example of learning how to interact with girls, highlighting that practical knowledge cannot be learned from a manual.

Aprendiendo a ser empresario

The speaker emphasizes that becoming an entrepreneur cannot be achieved through traditional business education but requires real-world experience.

Learning to be an entrepreneur

• Being an entrepreneur cannot be learned in business schools or universities.

• Only by engaging in concrete entrepreneurial projects and taking risks can one acquire the necessary knowledge.

• Formal education only provides repetitive techniques for subordinates.

Conclusión sobre el conocimiento empresarial

The conclusion is drawn about the nature of entrepreneurial knowledge and its acquisition.

Subjective and practical nature of entrepreneurial knowledge

• Entrepreneurial knowledge is subjective and practical, meaning it cannot be learned objectively or formally.

• It can only be gained through active engagement in entrepreneurial activities.

This summary covers key points from the transcript.

The Importance of Practical Knowledge in Business

In this section, the speaker emphasizes the importance of practical knowledge in business and criticizes the lack of real-world experience among university graduates.

Practical Knowledge vs. Academic Education

• The speaker argues that university graduates often lack practical knowledge because they have not worked in a company and solved concrete problems.

• He criticizes employers who complain about the lack of skills in university graduates, stating that it is their own fault for expecting fully-formed professionals without providing opportunities for hands-on learning.

• The speaker believes that universities should focus on providing a universal vision of scientific knowledge rather than becoming academies for specific technical skills.

Learning by Doing: Velázquez's Example

• The speaker uses the example of Diego Velázquez, a famous painter, to illustrate how practical knowledge is acquired through hands-on experience.

• Velázquez started as an apprentice in a painting workshop, where he initially performed menial tasks like cleaning and disposing waste.

• Over time, he observed and learned from experienced painters and eventually gained the opportunity to prepare paint mixtures and contribute to actual paintings.

• The speaker highlights that Velázquez learned to paint by actively engaging in the craft rather than solely relying on theoretical knowledge.

Practical Knowledge in Business

• The speaker asserts that practical knowledge is crucial for success in business and cannot be solely obtained from books or academic education.

• He distinguishes between practical knowledge (knowledge type A) and scientific knowledge (knowledge type B).

• Practical knowledge is acquired through practice, experience, and observation within specific circumstances, while scientific knowledge can be codified and expressed in books.

• Practical knowledge is dispersed among individuals with different experiences, while scientific knowledge tends to be centralized.

Understanding the Difference Between Practical Knowledge and Scientific Knowledge

In this section, the speaker further explores the distinction between practical knowledge and scientific knowledge, emphasizing the importance of practical knowledge in entrepreneurship.

Practical Knowledge (Type A) vs. Scientific Knowledge (Type B)

• The speaker refers to authors such as Michael Oakeshott and Friedrich Hayek who have theorized about the differences between practical knowledge and scientific knowledge.

• Practical knowledge (type A) is described as traditional, implicit, and based on apprenticeship or hands-on experience.

• It is transmitted through practice, observation, and tradition within specific contexts.

• On the other hand, scientific knowledge (type B) is formalized, codified, and can be expressed in books or academic education.

Importance of Practical Knowledge in Entrepreneurship

• The speaker highlights that practical knowledge plays a crucial role in entrepreneurship.

• Practical knowledge is acquired through real-world experiences, trial-and-error processes, and learning from others' actions.

• It is essential for entrepreneurs to observe and learn from experienced individuals in their field before seizing opportunities to apply their own practical knowledge.

Summary

The transcript discusses the significance of practical knowledge in business and entrepreneurship. The speaker criticizes the lack of real-world experience among university graduates and emphasizes that practical skills cannot be solely obtained from academic education. Using the example of Velázquez's journey as a painter, he illustrates how hands-on experience contributes to acquiring practical expertise. Additionally, he distinguishes between practical knowledge (type A) acquired through practice and observation within specific circumstances and scientific knowledge (type B), which can be codified in books. Understanding the difference between these two types of knowledge is crucial for aspiring entrepreneurs seeking success in their ventures.

Articulation

The speaker discusses the importance of articulation in communication.

Importance of Articulation

• Clear articulation is crucial for effective communication.

• It helps convey ideas and messages accurately.

• Proper articulation enhances understanding and prevents misinterpretation.

Tips for Improving Articulation

• Practice pronunciation exercises to strengthen speech muscles.

• Focus on enunciating each word clearly and distinctly.

• Pay attention to vowel and consonant sounds, ensuring they are pronounced correctly.

Remember that good articulation contributes to better communication and should be practiced regularly to improve speaking skills.