Fritz Machlup quotes:

When I reviewed Hayek's book, The Pure Theory of Capital, it is my sincere conviction that this work contains some of the most penetrating thoughts on the subject that have ever been published.

One of the most original and most important ideas advanced by Hayek is the role of the 'division of knowledge' in economic society.

Information is acquired by being told, whereas knowledge can be acquired by thinking.

If we did not have a patent system, it would be irresponsible, on the basis of our present knowledge of its economic consequences, to recommend instituting one. But since we have had a patent system for a long time, it would be irresponsible, on the basis of our present knowledge, to recommend abolishing it.

The danger of tautological propositions is considerable in discussions of the concept of normal profits. Because supernormal profits seem to invite newcomers to an industry and sub-normal profits seem to drive away those who are in an industry, some writers are inclined to define normal profits as the earnings of the fixed resources in an industry which neither grows nor declines in size or number of firms. It should be clear that such a definition is useless: it muddles together attractiveness and actual afflux, desirbility of entry and ease of entry, zero profits and monopoly rents.