The order of events may differ, but these are the roadmarks.
1. Rothbard really was pretty extreme, and at times his analysis makes no sense.
2. Mises didn't understand many things that Hayek did.
3. If there ever were such a thing as lack of aggregate demand, it would be a real problem, not that govt intervention would solve anything, heh heh.
4. Deflation is just as bad as inflation.
5. Internet Austrians don't know it, but the whole point of the ABCT is to explain why there is a lack of aggregate demand.
6. Sometimes there is just not enough money in the system for the economy to run smoothly.
7. Fractional Reserve Banking can play an important role in solving monetary disequilibrium.
8. Only trivial economic questions can be decided without advanced Mathematics, which is essential for umderstanding real economics.
9. The multiplier concept makes a lot sense.
10. Shocks to the system can create all sorts of problems Austrians don't really understand.
11. The whole point of a central bank is to smooth over shocks, obviously a good thing.
12. Mises in Human Action just made assertions, but never proved anything.
13. An increase in the money supply will increase consumer demand, which is what brings a country out of recession.
14. Although internet Austrians love Mises, it is Hayek who won a Nobel Prize, and was head and shoulders above Mises in economic understanding.
15. The mere act of the govt spending money increases GDP, and is therefore desirable.
16. Praxeology is vastly over-rated, because you cannot prove anything from that one axiom that humans act.
17. Mises showed how dumb he is with his silly regression theorem, which has been disproven by bitcoin.
18. Modern supercomputers can solve the calculation problem easily, which is not really a problem if we allow consumers to use money.
19. Economics is all about dissemination of knowledge, or lack of it, within an economy. Hayek understood this, which is why he is the superior economist.
20. Austrian Economics is a dead subject, with no room for new research.
21. Austrians never leave their ivory towers to see what is happening in the real world.
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It's easy to refute an argument if you first misrepresent it. William Keizer
I'm curious as to why you're posting this.
Secondly, absent the remarks about aggregate demand, I'm not sure about why the above indicates someone necessarily becoming a non-Austrian as opposed to a "Keynesian" (or even a Hayekian as opposed to a Misesian). Can you explain, or have you observed the above steps in people who have become Keynesians (not sure how you're defining that though).
"When the King is far the people are happy." Chinese proverb
For Alexander Zinoviev and the free market there is a shared delight:
"Where there are problems there is life."
It's a preliminary map of decline and fall. A person can tell what his next mis-step will be by finding where he is on the chart, and seeing what follows.
I have a preliminary hypothesis that a person at step N tells himself he will never, ever, slide down to step N+1. But he will.
Thus, it has predictive value, and tells people their future.
I emphasize that the arrangement is preliminary. If anyone can provide info about his own personal slide, the order in which he fell, which remaining steps in the slide he thinks might be true, which he insists he will never stoop to, science will advance. Time to step up, guys. You know who you are.
Abskebabs, am I correct in understanding you as saying that 3, 5 and 13 belong below the others? Is this from personal experience? Which ones do you believe so far? Which is the one you are turning over in your mind, seeing both sides?
I have indeed observed these steps in people; they are a composite of several sad case histories.
As for someone becoming a Hayekian as opposed to a Misesian, that's the whole point of this list, that nowadays, in the 21st century, nobody just "becomes a Hayekian". Becoming a Hayekian, is knowingly or unknowingly, a cover up, a red herring, a step on a slippery slope. Nowadays, "Hayekian" is doublespeak for "Austrian in name only".
Hayekians, you have been warned, or is it exposed?
On the point about becoming a Hayekian; you could just stop at point #2 and start believing in the minimum wage and maximum-working hour laws.
Mr. Krueger: “What about limitation of working hours—a maximum-hours act? Is that compatible with your notions of proper planning?” Mr. Hayek: “Yes, if it is not carried too far. It is one of these regulations which creates equal conditions throughout the system. But, of course, if it does beyond the point where it accords with the general situation of the country, it may indeed interfere very much. . . .” Mr. Merriam: “Would any limitation on the hours of labor be objectionable in your judgment?” Mr. Hayek: “Not ‘any,’ but they can be. There you have one of the instances where my objection is not one of principle but one of degree. It is one of the things which cannot be made to fit the question of the cost involved in that particular measure.” Mr. Krueger: “Is a minimum wage law permissible?” Mr. Hayek: “A general, flat minimum wage law for all industry is permissible, but I do not think that it is a particularly wise method of achieving the end. I know much better methods of providing a minimum for everybody. But once you turn from laying down a general minimum for all industry to decreeing particular and different minima for different industries, then, of course, you make the price mechanism inoperative, because it is no long the price mechanism which will guide people between industries and trades.”
Winners of the Nobel Prize in Economics that fully support a basic income include Herbert A. Simon, Friedrich Hayek, Robert Solow, Milton Friedman, Jan Tinbergen, James Tobin and James Meade.
How did you derive this, exactly?
Since I can't help but feel (arrogantly and possibly mistakenly) that many of these arguments are addressed to me, since some of these arguments are exactly what I argue (or a distorted version of this) I will go through this list...
"1. Rothbard really was pretty extreme, and at times his analysis makes no sense."
Rothbard was not (IMO) extreme except from a comparison of where he stood in relation to the mainstream. I think Rothbard goes too far in some of his arguments (I.E morality and the extent of price flexibility), but I would not consider the above to describe me. I guess I have a long way to go if I am to be a Keynesian.
"2. Mises didn't understand many things that Hayek did."
I'm not convinced of this. I have a hard time ascertaining Mises' level of understanding. On many of the economic topics they both wrote about Hayek was a lot more clear, but this does not mean that Mises didn't understand these things, merely that Hayek academically elaborated upon them more clearly.
"3. If there ever were such a thing as lack of aggregate demand, it would be a real problem, not that govt intervention would solve anything, heh heh."
I agree with this. The last two words summarize my view especially succinctly.
"4. Deflation is just as bad as inflation."
Depends if we're talking about govt induced or not, but I usually don't think that it is... I guess I could see some situations where it could be.
"5. Internet Austrians don't know it, but the whole point of the ABCT is to explain why there is a lack of aggregate demand."
Nope
"6. Sometimes there is just not enough money in the system for the economy to run smoothly."
If it occurs suddenly, then yes in the short term. This is correct as long as the currency is infinitely devisable. If there were only a penny wandering around in the economy right now we'd have a problem. If the government issued micropennies and so on then there would be no issue
7. "Fractional Reserve Banking can play an important role in solving monetary disequilibrium."
I suppose it can but the effects would be more negative than positive. It's like saying that cutting off your arm would stop the unpleasantness of your arm being asleep.
8. Only trivial economic questions can be decided without advanced Mathematics, which is essential for understanding real economics.
So no. So absolutely ultimately no.
9. "The multiplier concept makes a lot sense."
In the short run, within the bounds Keynesians say it does, then yes under certain situations. Once again, however, long term problems result.
"10. Shocks to the system can create all sorts of problems Austrians don't really understand."
These can cause problems and many Austrians overlook them, but this is not to say they are at all unknown. I consider the economics of such things just an extension of Austrian Theory.
"11. The whole point of a central bank is to smooth over shocks, obviously a good thing."
See 6.
"12. Mises in Human Action just made assertions, but never proved anything."
No.
"13. An increase in the money supply will increase consumer demand, which is what brings a country out of recession."
First part yes under most situations, second part no under most situations.
"14. Although internet Austrians love Mises, it is Hayek who won a Nobel Prize, and was head and shoulders above Mises in economic understanding."
I do think that Hayek appreciated some things more thoroughly than Mises did, and for the rest of my opinion on this you can look at the above point on the subject. However, the Nobel Prize has 0.000% to to with this.
"15. The mere act of the govt spending money increases GDP, and is therefore desirable."
First part no under most situations, second part no under nearly all situations.
"16. Praxeology is vastly over-rated, because you cannot prove anything from that one axiom that humans act."
Yes and no. I have conflicted views on this one. You can prove how people will act under any situation, you have a lot harder time actually knowing what situations prevail in the real world. I have sympathy with the statement I totally disagree.
"17. Mises showed how dumb he is with his silly regression theorem, which has been disproven by bitcoin."
Neh
"18. Modern supercomputers can solve the calculation problem easily, which is not really a problem if we allow consumers to use money."
Nay. I do think that Mises overstated the calculation problem, however. I've expressed this before, but I do think that if the government had a knowledge of all consumer prices and preferences that they could plan the structure of production. This is part of Mises' claim, but since it is impossible anyway, this is a question entirely of theory.
"19. Economics is all about dissemination of knowledge, or lack of it, within an economy. Hayek understood this, which is why he is the superior economist."
Mises did understand the importance of this, but Hayek placed a greater degree of emphasis on it.
"20. Austrian Economics is a dead subject, with no room for new research."
Just the opposite, even though I feel that many of the traditional areas AE has looked at may have been mostly fleshed out.
"21. Austrians never leave their ivory towers to see what is happening in the real world."
Eh, a little bit of truth with this, but the same could be said for most other economic schools to. This is why I consider myself an "intellectual anarchist" above all else
"As for someone becoming a Hayekian as opposed to a Misesian, that's the whole point of this list, that nowadays, in the 21st century, nobody just "becomes a Hayekian". Becoming a Hayekian, is knowingly or unknowingly, a cover up, a red herring, a step on a slippery slope. Nowadays, "Hayekian" is doublespeak for "Austrian in name only".
Hayekians, you have been warned, or is it exposed?"
This sounds so dogmatic it's scary.
in case you hadnt noticed, Dave isnt an austrian economist or philosopher. he is a dogmatist, perhaps even an aspirant demagogue.
"in case you hadnt noticed, Dave isnt an austrian economist or philosopher. he is a dogmatist, perhaps even an aspirant demagogue."
I'm waiting for the day that Dave's men storm the white house and begin a new dark era of a free market autocracy.
Smiling Dave:I have a preliminary hypothesis that a person at step N tells himself he will never, ever, slide down to step N+1. But he will. [.......] If anyone can provide info about his own personal slide, the order in which he fell, which remaining steps in the slide he thinks might be true, which he insists he will never stoop to, science will advance. Time to step up, guys. You know who you are.
This is where you lose me. Can you please show me one example of anyone who has made this journey from Austrian to Keynesian? Let alone following this kind of path...somehow reading and understanding Human Action, yet later deciding juvenile nonsense that even Krugman wouldn't say, like 15. 4 and 9 are pretty good stretches too.
I'm pretty curious what (if anything) youre basing this on. I've certainly never heard of any kind of "fall". Callahan maybe, but i think anyone can see his was nothing like this "path".
Lol, thanks for the laugh SD, that's some serious inside-baseball economic comedy :) I knew you were wrong on bitcoin but now I see you're confused about practically everything, wow. Wow.
I think it's simpler :
#1 - realize there's more career opportunities justifying state power than criticizing it
#2 - sell out
... just as the State has no money of its own, so it has no power of its own - Albert Jay Nock
^
Do you have a shred of evidence that this happens on a regular basis or is the result for most Austrian to Keynesian conversions?
Austrian Economists like Walter block make nearly 200K a year and I know that Catalan's gradschool professors don't even express much interest in his views.
It's mostly about money, is it not? You can probably put #20 on the end of any list and people will slide toward it. Research costs money and researchers don't work for free.
Changed my mind. No need to for me to post in this thread. :)
Ambition is a dream with a V8 engine - Elvis Presley
Seems legit.
Austrian Economists like Walter block make nearly 200K a year...
How do you know that? I've seen ads for math teacher jobs at about $100k. I've never heard of $200k.
Walter Block is supposed to make something like $160,000-$180,000 per year. Apparently he gets paid a lot for his libertarian lectures throughout the world. He doesn't just earn his $$$ by his teaching position.
If anything, this thread makes me think of this:
"Topic dilution is not only effective in forum sliding it is also very useful in keeping the forum readers on unrelated and non-productive issues. This is a critical and useful technique to cause a 'RESOURCE BURN.' By implementing continual and non-related postings that distract and disrupt (trolling ) the forum readers they are more effectively stopped from anything of any real productivity."
- http://cryptome.org/2012/07/gent-forum-spies.htm
"On many of the economic topics they both wrote about Hayek was a lot more clear [than Mises], but this does not mean that Mises didn't understand these things, merely that Hayek academically elaborated upon them more clearly."
Hayek makes no sense to me. For example, how do you deal with this contradiction?
(1) "In Hayek's view, the central role of the state should be to maintain the rule of law, with as little arbitrary intervention as possible", and
(2) "Hayek also wrote that the state has a role to play in the economy, and specifically, in creating a "safety net"" - https://en.wikipedia.org/wiki/Friedrich_Hayek
And it's not just me. See https://mises.org/daily/5747/Why-Mises-and-not-Hayek
"I could go on and on, citing Hayek's muddled and contradictory definitions of freedom and coercion... In distinct contrast, how refreshingly clear — and very different — is Mises!"
I was talking about the inner workings of economic issues. I agree that Mises is a lot more consistent, and overall a lot better on political/policy issues than Hayek, and he had few if any of the straight up bizarre contradictions Hayek had. For instance Hayek provides the real groundwork for how an increase in savings elongates the productions structure, something which Mises pretty much just says happens in HA. He gives a good analogy and basic reason in the from of time preference, but he doesn't show how this is actually reflected and how this works in the market economy itself.
Thusly IMO Hayek is a lot more prolific as a structure of production/business cycle theorist than his teacher, although in political and most other economic issues Mises takes the cake.
Smiling Dave: The order of events may differ, but these are the roadmarks. 1. Rothbard really was pretty extreme, and at times his analysis makes no sense. 2. Mises didn't understand many things that Hayek did. 3. If there ever were such a thing as lack of aggregate demand, it would be a real problem, not that govt intervention would solve anything, heh heh. 4. Deflation is just as bad as inflation. 5. Internet Austrians don't know it, but the whole point of the ABCT is to explain why there is a lack of aggregate demand. 6. Sometimes there is just not enough money in the system for the economy to run smoothly. 7. Fractional Reserve Banking can play an important role in solving monetary disequilibrium. 8. Only trivial economic questions can be decided without advanced Mathematics, which is essential for umderstanding real economics. 9. The multiplier concept makes a lot sense. 10. Shocks to the system can create all sorts of problems Austrians don't really understand. 11. The whole point of a central bank is to smooth over shocks, obviously a good thing. 12. Mises in Human Action just made assertions, but never proved anything. 13. An increase in the money supply will increase consumer demand, which is what brings a country out of recession. 14. Although internet Austrians love Mises, it is Hayek who won a Nobel Prize, and was head and shoulders above Mises in economic understanding. 15. The mere act of the govt spending money increases GDP, and is therefore desirable. 16. Praxeology is vastly over-rated, because you cannot prove anything from that one axiom that humans act. 17. Mises showed how dumb he is with his silly regression theorem, which has been disproven by bitcoin. 18. Modern supercomputers can solve the calculation problem easily, which is not really a problem if we allow consumers to use money. 19. Economics is all about dissemination of knowledge, or lack of it, within an economy. Hayek understood this, which is why he is the superior economist. 20. Austrian Economics is a dead subject, with no room for new research. 21. Austrians never leave their ivory towers to see what is happening in the real world.
Wow, nice.
I mean, I would take away things like "winning Nobel Prize" or unspecified claims of "desirability" of a policy and that would be a very interesting reality check for many of the aspiring austrianites here.
"Wow, nice.
I mean, I would take away things like "winning Nobel Prize" or unspecified claims of "desirability" of a policy and that would be a very interesting reality check for many of the aspiring austrianites here."
How, exactly?
Also, I'd really hope that no one who started off as an Austrian economist would ever advocate the final point. I'm in managerial economics right now which you would expect to be pretty "low to the ground", yet even this class is theoretical and ivory tower as hell in a school that is primarily focused on direct employability of its students. Modern academia (in economics at very least) is so far removed from both the basics and the real world that any criticism of the Austrians on theoretical discrepancies is frankly laughable.
Neodoxy: "Wow, nice. I mean, I would take away things like "winning Nobel Prize" or unspecified claims of "desirability" of a policy and that would be a very interesting reality check for many of the aspiring austrianites here." How, exactly? Also, I'd really hope that no one who started off as an Austrian economist would ever advocate the final point. I'm in managerial economics right now which you would expect to be pretty "low to the ground", yet even this class is theoretical and ivory tower as hell in a school that is primarily focused on direct employability of its students. Modern academia (in economics at very least) is so far removed from both the basics and the real world that any criticism of the Austrians on theoretical discrepancies is frankly laughable.
Economists in general are Ivory Tower dwellers, that's why I chose finance :)