B Y C H R I S C A LT O N
To Understand Economics, First Understand Private Property Early societies established private property rights, which individuals recognized reciprocally
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n Man, Economy, and State, Murray Rothbard expounds the principles of economics by reconstructing an economy from the ground up. Following the practice of classical economists, he opens the book by imagining Robin-
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PIPEL INE OBSERV ER CAEPL A .ORG
son Crusoe alone on an island. After identifying the operative laws that apply even to isolated individuals, Rothbard’s second chapter considers Crusoe on an island with one other person, introducing the concept of direct exchange, or the barter economy. In the third and fourth chapters, Rothbard considers the origins of money
and prices in an economy of indirect exchange. For a treatise on price theory, Rothbard recognizes the need to explain the origins of money prices, as Carl Menger and Ludwig von Mises did before him. In The Theory of Money and Credit, Mises built on Menger’s original explanation for the origin of
