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Is David Friedman an Austrian?

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Individualist posted on Sun, Aug 1 2010 2:43 PM

Is David Friedman a follower of the Austrian School of Economics? I know his father was the founder of the Chicago School, but I also know David Fiedman is an anarcho-capitalist. Is there a branch of the Chicago School that doesn't defend the Federal Reserve?

"Every decent man is ashamed of the government he lives under."  - H. L. Mencken

 

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I am not a member of the Austrian school of economics.

Is there a branch of the Chicago School that does defend the Federal Reserve? My father argued that it was largely responsible for the Great Depression.

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Neoclassical:

As in recommendations for reading?

Books, lectures, or whatever. But the most important suggests of course probably will be books.

If I wrote it more than a few weeks ago, I probably hate it by now.

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There are definitely neoclassical scholars that would topple the Federal Reserve (e.g., David Friedman, Bryan Caplan, Richard H. Timberlake).

How exactly are Neoclassical Ancaps different from Austrian Ancaps? Do they have the same conclusions, but a different means of reaching those conclusions?

Anarcho-capitalism boogeyman

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I. Ryan, I recommend these:

  1. Hidden Order: The Economics of Everyday Life by David Friedman. This sounds like an easygoing popularization, but there is some serious microeconomics in it. You'll learn about "indifference curves" and other neoclassical concepts that Austrians shun.
  2. Economics by Glenn Hubbard and Anthony O'Brien. This is absolutely one of my favorite microeconomics textbooks.
  3. Law's Order: What Economics Has to Do with Law and Why It Matters by David Friedman. This presents economics in the context of law; you'll learn much about both. Preview the back cover just to get a taste of how insightful it is.
  4. Price Theory: An Intermediate Text by David Friedman. He actually reproduced much of this material in his Hidden Order book, but all the subjects are covered with more depth in this textbook.

Overall, if you've been learning about Austrian economics, you'll more easily transition into these books.

"I'm not a fan of Murray Rothbard." -- David D. Friedman

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shazam:
How exactly are Neoclassical Ancaps different from Austrian Ancaps? Do they have the same conclusions, but a different means of reaching those conclusions?

We take certain ideas seriously, like public goods and market failure. Many Austrians outright deny these ideas. But, ultimately, you're right: different means to the same conclusions, even though many of the steps are similar (I don't argue with why Austrians reject the minimum wage).

For technical differences, read Bryan Caplan's Why I am Not an Austrian Economist.

"I'm not a fan of Murray Rothbard." -- David D. Friedman

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Neoclassical:
I. Ryan, I recommend these:

  1. Hidden Order: The Economics of Everyday Life by David Friedman. This sounds like an easygoing popularization, but there is some serious microeconomics in it. You'll learn about "indifference curves" and other neoclassical concepts that Austrians shun.
  2. Economics by Glenn Hubbard and Anthony O'Brien. This is absolutely one of my favorite microeconomics textbooks.
  3. Law's Order: What Economics Has to Do with Law and Why It Matters by David Friedman. This presents economics in the context of law; you'll learn much about both. Preview the back cover just to get a taste of how insightful it is.
  4. Price Theory: An Intermediate Text by David Friedman. He actually reproduced much of this material in his Hidden Order book, but all the subjects are covered with more depth in this textbook.

Overall, if you've been learning about Austrian economics, you'll more easily transition into these books.

I forgot to also recommend More Sex Is Safer Sex: The Unconventional Wisdom of Economics by Steven Landsburg.

"I'm not a fan of Murray Rothbard." -- David D. Friedman

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Neoclassical, it's not that Austrians shun indifference curves for the sake of it, it's that most macro-economic policy advice based on it commits the fallacy of interpreting utility cardinally (as it shouldn't) while it is defined ordinally (as it should).

How do you overcome that problem?

Regarding the Marschall vs Hicks etcetera, could you summarize the differences for me? I'm not aware of that. Thanks.

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Many Austrians outright deny these ideas.

Through arguments. They don't just deny them.

Freedom of markets is positively correlated with the degree of evolution in any society...

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DD5 replied on Sun, Aug 1 2010 10:27 PM

Neoclassical:

For technical differences, read Bryan Caplan's Why I am Not an Austrian Economist.

 

This Caplan guy is like a hermit who has read some Austrian economics simply for the sake of criticizing it.  He hasn't made any serious mental effort to understand it in depth.  It's not enough just to read!  You have to reflect on it, discuss it, and even debate it.  He struggles with an argument or a proposition and he just assumes it's false, then goes on to naively criticize it as a hundred others before him have already done so.

 

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DD5, are you serious? Caplan was an Objectivist in highschool, but became a Rothbardian in college (both in economics and political philosophy). During graduate school at Princeton, he came to adopt mainstream neoclassical economics and intuitionism in ethics (although he is still an anarcho-capitalist). I assure you, he knows more Mises and Rothbard than 99% of the people on these forums. Granted his knowledge of Hayek isn't that impressive, but the same thing could be said of most of the people that post here.

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Granted his knowledge of Hayek isn't that impressive, but the same thing could be said of most of the people that post here.

We're on Caplan levels? Wow!

"I am an aristocrat. I love liberty, I hate equality."
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DD5 replied on Sun, Aug 1 2010 11:53 PM

 

Solid_Choke:

Caplan was an Objectivist in highschool, but became a Rothbardian in college ......

And what fraternity did he belong to?  Maybe that somehow can discredit my opinion also.

 

I've read much of his stuff in the past.  It's mostly philosophical nonsense; like some fancy lawyer who gets paid to come up with some sophisticated arguments to acquit his guilty client in the presence of some ignorant jurors.

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I am not a member of the Austrian school of economics.

Is there a branch of the Chicago School that does defend the Federal Reserve? My father argued that it was largely responsible for the Great Depression.

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hehe. Hi David. I recently watched your talk on market vs political failures, and it brought up some things I hadn't been thinking about before. Thank you.

I recently created a thread on the free rider problem, recommending some solutions, but no one here seems to have bitten. Could you have a look at it and offer some thoughts/critique?

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Joe replied on Mon, Aug 2 2010 7:35 AM

 

a whole mess of the Mises U lectures address differences between Austrian and Neoclassical and why.

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Joe replied on Mon, Aug 2 2010 7:45 AM

 

David Friedman:

I am not a member of the Austrian school of economics.

Is there a branch of the Chicago School that does defend the Federal Reserve? My father argued that it was largely responsible for the Great Depression.

 

I don't think that the OP meant defending the ACTIONS of the FED, I think he meant the existence of it, and probably not just in its current format, but a central bank in general.  So in those terms, I don't think many Monetarists would not 'defend' the FED or the idea of central banking.
 
And I am still new and haven't read America's Great Depression yet, and I only sort of know about MF's explanation for the Great Depression, but I am pretty sure the Austrian story and the Chicago story are quite different in terms of the role that the FED played.  I believe the Austrian story is that the FED caused the boom (starting roughly in 27) that led to the 29 crash, but the reason why there was a decade long depression and not a recession was more down to the actions of Hoover and FDR.  Whereas I think the Chicago story has something to do with the FED not expanding the money supply enough, no?
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