Is there an Austrian critique of the Solow model?
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Not really. The Solow model just states that economic growth is a function of savings (capital accumulation per person) and technological innovation. This isn't really controversial for any school of thought, with the exception of post-Keynesians and Neo-Ricardians. The Austrians, though, would object to the "golden-rule" steady-state, i.e., the "appropriate/optimal" level of savings.
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Esuric,
Yeah, I assumed that Austrians would have their critiques on the golden rule steady state, I dont suppose that there are articles by Austrians specifically on this, are there?
Not that I'm aware of, though I heard Garrison mention it in one of the online lectures available here at Mises.org.
really? do you know which lecture
nevermind, i think i found the lecture you are talking about... (unless you are talking about another one)
around 9:20ish
also, the only austrian articles that i found critiquing Solow's capital theory (briefly though) are by Ludwig Lachmann, which is not a shocker since Lachmann did specialized in Capital theory. On Austrian Capital Theory and Austrian Economics in the Age of Neo-Ricardian Counterrevolution are the two articles
There is an austrian critique of Solow Model:
Hayek in 1931, Prices and Production:
1. Aggregates are not causally related to other aggregates.
Mises, in 1952:
2. Technology (recipes) also develops as part of capital. It is not something external that just appears to determine form of "production function," and thus, are not merely exogenously-fixed coefficients which are represented as force-multipliers of capital or labour inputs. To use specific technologies, first, one must save resources to invest in necessary capital. Then, one must also invest resources to research technology. All resources available for such things are part of savings!
The Hayek source is unsatisfactory b/c he is not specifically talking about the Solow model, he doesn't even mention Solow in that book at all. I know the general Austrian critique of aggregation and how it applies to models but I was looking for specific critiques on the Solow model.
Also, where is the Mises quote from?
The best Austrian critiques of growth models like Solow and Harrod-Domar that I know of are from Lachmann. I strongly recommend for this chapter 5 of Capital and its Structure, as well as the relevant sections of Capital, Expectations and the Market Process. It is unfortunate that Lachmann is comparatively neglected these days. Aside of some odd remarks about Bohm Bawerk and some others, he's pretty darn good.
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