Claude Frédéric Bastiat (1801 — 1850) is one of the greatest economists ever. His role as organizer of the French, and inspiration of the nineteenth- century continental European free-trade movement is not controversial, and all historians recognize him as a great pamphleteer — some even calling him “the most brilliant economic journalist who ever lived.”
It is however not generally recognized that Bastiat was also a significant theoretician whose discoveries have had a lasting importance. His intellectual legacy has been unduly neglected because it concerns problems that are not on the radar screen of twentieth-first-century mainstream economists. It has much common ground with present-day Austrian economics, though, and the purpose of this article is to unearth some of these similarities and to help restore Bastiat to his rightful place in the history of economic science.
HARMONY VERSUS EQUILIBRIUM
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Bastiat is often presented as a champion of the doctrine of harmony. While this is correct, it is generally not well understood what this doctrine actually says and how it contrasts with more recent views about the interrelation of social phenomena. Bastiat’s magnum opus bears the telling title Economic Harmonies. It is in this book that he develops and defends the thesis that the interests of all members of society are harmonious if and insofar as private property rights are respected or, in modern parlance, that the unhampered market can operate independent of government intervention.
The nub of his argument is a very simple one. He asserts that there is nothing in the nature of the free market that would make its…