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10 Worst Economists of All-Time

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Esuric Posted: Sat, Mar 6 2010 10:19 PM

Here's my list:

  1. Piero Sraffa (Rather than accepting marginalism, he attempted to revive Marx's exploitation theory of interest with a cost-of-production theory of value).
  2. Karl Marx (Convinced the world that all economic activity is a priori exploitative).
  3. Silvio Gesell (Magic money theorist with the logic of a five year old).
  4. Thomas Malthus (Put forth three of the greatest economic fallacies known to date).
  5. Thorstein Veblen (Brought historicism to the U.S.)
  6. John Maynard Keynes (Revived old Malthusian and Mercantilist fallacies).
  7. Joan Robinson (Foretold of North Korean economic supremacy).
  8. John Law (Left the French treasury flat broke, and ruined the currency in a mere five year period).
  9. John Kenneth Galbraith (Proclaimed that increased fiscal spending would solve all of NYC's problems. Of course, they increased spending by 400%, and things only got worse).
  10. Paul Samuelson (Prophesized Soviet dominance by 1991, in 1988).

Dishonorable mentions: Gustav von Schmoller, Nicholas Kaldor, Robert E. Lucas.

Criteria: (1) Damage done to economics as a science, (2) lack of reasoning ability, (3) and intellectual dishonesty. I placed most of the weight on (2).

Add your own!

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Doesnt Krugman get an honorable mention?

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I was going to suggest adding Krugman as an 11.

He reminds me somewhat of annoying nat that just won't leave you alone, no matter how many times you shoo it away.

 

 

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Nielsio replied on Sat, Mar 6 2010 10:51 PM

Obama: decreasing the deficit through record spending.

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Azure replied on Sat, Mar 6 2010 10:51 PM

  He's not really much worse than every other pundit who pretends to understand economics IMO. To my knowledge he hasn't scarred economic knowledge to the extent the other economists on the list have.

And I would have given Mark the #1 slot, but regardless...

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Sage replied on Sat, Mar 6 2010 11:32 PM

I find Malthus especially despicable.

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von Vodka replied on Sat, Mar 6 2010 11:36 PM

Karl Polanyi and Oskar Lange might deserve a mention.

Edit: Rothbard might have put Ricardo and even Smith on that list.

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Bert replied on Sat, Mar 6 2010 11:55 PM

I remember Rothbard saying something along the lines of "you won't learn anything you don't already know by reading Smith", or to that extent.  (I could be wrong and it could have been Mises...)

I had always been impressed by the fact that there are a surprising number of individuals who never use their minds if they can avoid it, and an equal number who do use their minds, but in an amazingly stupid way. - Carl Jung, Man and His Symbols
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Esuric replied on Sun, Mar 7 2010 12:25 AM

von Vodka:
Edit: Rothbard might have put Ricardo and even Smith on that list.

I disagree. Their arguments for free-trade, and Ricardo's analysis of the trade cycle, excludes them from this list.

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10 hardly scratches the surface.

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Felipe replied on Sun, Mar 7 2010 12:48 AM

Diego Guerrero (came up with a theory based on the LTV that allegedly allows to scientifically establish prices dismissing the role of the market)

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Bert replied on Sun, Mar 7 2010 1:00 AM

We could do a list called Economic Blunders of the Past 100 Years.  Stating how many would undermine the future achievements of the government.  They are always trying to out do themselves.

I had always been impressed by the fact that there are a surprising number of individuals who never use their minds if they can avoid it, and an equal number who do use their minds, but in an amazingly stupid way. - Carl Jung, Man and His Symbols
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Even though the classicals were wrong and their arguments led to much confusion later in some respects, I wouldn't be willing to include them on this list. They may not have been the best economists but they were far from the worst.

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

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Kakugo replied on Sun, Mar 7 2010 1:17 AM

Esuric:

 

Silvio Gesell (Magic money theorist with the logic of a five year old).

     


    Actually a five year old believing in Santa Claus displays better logic than he ever did.

     

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    Jon Irenicus:

    Even though the classicals were wrong and their arguments led to much confusion later in some respects, I wouldn't be willing to include them on this list. They may not have been the best economists but they were far from the worst.

    Now that you mention it, those that constitute the stock filler in a profession tend to be the worst.  One man who tries to be original may be wrong.  What about the men that believe him?

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    Azure replied on Sun, Mar 7 2010 2:23 AM

    Never heard of this Gesell before, so a quick look at Wikipedia got me this (emphasis mine):

    In the "natural economic order" which he aimed for, the most talented people would have the highest income, without distortion by interest and rent charges. The economic status of the less talented would also improve, because they would not be forced to pay interest and rent charges.

    This obviously isn't a complete representation of his ideas, but upon immediate inspection from what is given here he falls for two very obvious errors.

    While these errors are very bad, they are ideas held by the vast majority of society. In this case, why is Gesell on the list? Is he one of the main reasons these ideas are popular today? Or is there something bigger Wikipedia failed to mention?

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    Esuric replied on Sun, Mar 7 2010 2:41 AM

    Azure:
    n this case, why is Gesell on the list? Is he one of the main reasons these ideas are popular today?

    He believed that recessions where the inevitable result of an imbalance between money and commodities. This sounds reasonable enough, but his explanation of this phenomenon, and his conclusion's, are anything but reasonable. The imbalance, according to Gesell, is the result of a disparity between the physical constitution of money (gold) and of all other commodities. The former never rusts, never rots, and is durable; while the latter rots and can be destroyed by natural disasters. Thus, the value of the former (gold/money) must depreciate and lose its permanency if balance is to be restored (between money and commodities). His solution, then, was to replace gold with paper money tickets with stamps on the back (easily inflated). This form of money would lose value over time (the stamps would expire over time, and when used), which would force consumption, and bring prosperity to the world! (........)

    "If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion."

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    Esuric:

    Azure:
    n this case, why is Gesell on the list? Is he one of the main reasons these ideas are popular today?

    He believed that recessions where the inevitable result of an imbalance between money and commodities. This sounds reasonable enough, but his explanation of this phenomenon, and his conclusion's, are anything but reasonable. The imbalance, according to Gesell, is the result of a disparity between the physical constitution of money (gold) and of all other commodities. The former never rusts, never rots, and is durable; while the latter rots and can be destroyed by natural disasters. Thus, the value of the former (gold/money) must depreciate and lose its permanency if balance is to be restored (between money and commodities). His solution, then, was to replace gold with paper money tickets with stamps on the back (easily inflated). This form money would lose value over time (the stamps would diminish when used, and over a specific period of time), which would force consumption, and bring prosperity to the world! (........)

    You know, I've known about Gesell for a while now, but I still can't believe anyone actually thought that junk.

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    Thorstein Veblen was a damn good economist. We need more evolutionary theory in economics, not less.

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    Conza88 replied on Sun, Mar 7 2010 3:01 AM

    Bert:

    I remember Rothbard saying something along the lines of "you won't learn anything you don't already know by reading Smith", or to that extent.  (I could be wrong and it could have been Mises...)

    Yeah, it was Mises.

    "Nobody should believe that he will find in Smith’s Wealth of Nations information about present-day economics or about present-day problems of economic policy. Reading Smith is no more a substitute for studying economics than reading Euclid is a substitute for the study of mathematics."

    ~ Economic Freedom and Interventionism, p. 117

     

    "Marx’s economic teachings are essentially a garbled rehash of the theories of Adam Smith and, first of all, of Ricardo."

    ~ Theory and History, pp. 124–25

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    Azure replied on Sun, Mar 7 2010 3:12 AM

    Esuric:

    Azure:
    n this case, why is Gesell on the list? Is he one of the main reasons these ideas are popular today?

    He believed that recessions where the inevitable result of an imbalance between money and commodities. This sounds reasonable enough, but his explanation of this phenomenon, and his conclusion's, are anything but reasonable. The imbalance, according to Gesell, is the result of a disparity between the physical constitution of money (gold) and of all other commodities. The former never rusts, never rots, and is durable; while the latter rots and can be destroyed by natural disasters. Thus, the value of the former (gold/money) must depreciate and lose its permanency if balance is to be restored (between money and commodities). His solution, then, was to replace gold with paper money tickets with stamps on the back (easily inflated). This form of money would lose value over time (the stamps would expire over time, and when used), which would force consumption, and bring prosperity to the world! (........)

    Wait.

    So according to Gesell, the value of money continuously rises because the supply of goods is continuously shrinking (as they "rot and can be destroyed by natural disasters"). But doesn't this mean that production doesn't exist!? Wow. I really underestimated this guy.

    But if the supply of goods were continuously shrinking (and never being replaced by production) then wouldn't prices rise, thus the purchasing power of money fall? Seems like this guy got everything backwards.

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    Esuric replied on Sun, Mar 7 2010 3:31 AM

    Solid_Choke:

    Thorstein Veblen was a damn good economist. We need more evolutionary theory in economics, not less.

    Human nature and laws of human action do in fact exist. Furthermore, the idea of replacing entrepreneurs with engineers is absolutely ridiculous.

    "If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion."

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    Esuric:
    I disagree. Their arguments for free-trade, and Ricardo's analysis of the trade cycle, excludes them from this list.

    I believe that the point wasn't that Ricardo and Smith were bad, merely that Rothbard disapproved of them, right?

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    They were probably better than many modern economists. Also, given how much use Mises makes of Ricardo, I would definitely not place him on such a list.

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

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    I can't disagree with your reasoning, I'm merely trying to elucidate what (I think) was meant by that previous poster.

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    Not sure I agree with the choice of Malthus. When referring to population growth rates he made no real scientific errors, he only failed to predict the agricultural revolution. Ben Franklin provided him with much of the population data from the colonies but supposedly the data collectors failed to decipher between birth rates and immigration thus rendering an extremely bleak picture. You have to remember that before his writing the public operated under the impression that there was a negative population growth rate. Even the statisticians of the time only believed that the population would only double every 400-600 years. Thus to point out that population growth was exponential was a scientific achievement.

    Further, I believe that Todd Buchholz pointed out that of the four stages of economic growth

    • 1) Pre industrialization (high birth rate, high death rate)
    • 2) Early industrialization (High birth rate, low death rate)
    • 3) Industrialization (lower birth rate, lower death rate)
    • 4) Post industrialization (very low birth rates, very low death rates)

    That Malthus, writing in stage two, had cause for concern. It was the public that blew the problem out of proportion.        

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    Conza, I think Bert was alluding to the following famous Rothbard quote:

    "The problem is that he [Smith] originated nothing that was true, and whatever he originated was wrong; [...] For Smith not only contributed nothing of value to economic thought; his economics was a grave deterioration from his predecessors: [...]" (Economic  Thought before Adam Smith, pp. 435/6)

    Mises was merely saying that Smith is now obsolete; Rothbard's criticism is much harsher.

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    Conza88 replied on Sun, Mar 7 2010 7:25 AM

    David K.:
    Conza, I think Bert was alluding to the following famous Rothbard quote

    I know the quote well & believe the other one I mentioned from Mises, is the exact one he was referring too.

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    Conza88:
    Reading Smith is no more a substitute for studying economics than reading Euclid is a substitute for the study of mathematics

    You could do worse than study Euclid if you are interested in Math. His book is but a small piece of the puzzle, [which is what Miises was saying], but it still holds up.

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    "You won't learn anything you don't already know by reading Smith" is much closer to the Rothbard quote than to the Mises quote. It's Rothbard who implied that someone who has read the Spanish scholastics, Cantillon, Turgot etc. won't learn anything by reading Smith. Mises, on the other hand, was merely saying that modern economists know things that Smith didn't know; this is compatible with the assumption that someone who has read modern economists can learn something by reading Smith. (In fact, Mises explicitly urged his contemporaries to read Smith.)

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    Esuric:

     Robert E. Lucas.

    Might I ask what particular criteria qualify Lucas for the dishonourable mention?

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    What did Kaldor and Lucas do?

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    Bert replied on Sun, Mar 7 2010 11:12 AM

    Conza88:

    David K.:
    Conza, I think Bert was alluding to the following famous Rothbard quote

    I know the quote well & believe the other one I mentioned from Mises, is the exact one he was referring too.

    Those are the two I was referring too, I remember them now from The Quotable Mises.

    I had always been impressed by the fact that there are a surprising number of individuals who never use their minds if they can avoid it, and an equal number who do use their minds, but in an amazingly stupid way. - Carl Jung, Man and His Symbols
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    Esuric replied on Sun, Mar 7 2010 2:57 PM

    Jeremiah Dyke:
    Not sure I agree with the choice of Malthus. When referring to population growth rates he made no real scientific errors, he only failed to predict the agricultural revolution.

    No, the whole thing is one absurd fallacy. Human beings are not like rats, who mindlessly and uncontrollably multiply in the face of new food supplies. In fact, we do the exact opposite (which you mention). Either way, even if we choose to ignore this, he would still be responsible for introducing two other preposterous fallacies (paradox of thrift, and the belief that too much wealth causes depressed business activity). I think there's a strong case for Malthus at #1.

    abskebabs:
    Might I ask what particular criteria qualify Lucas for the dishonourable mention?

    Three reasons: (1) the belief that rational calculation is always possible, and that people do not make systemic errors when predicting the future, is the ultimate straw man, which statist's have been (successfully) attacking for quite some time (the behavioral school); (2) it prevents free market economists, who have been poisoned by this nonsense, from understanding the true effects of inflation, and the role (and even existence) of radical uncertainty. (3) There is no future general equilibrium which the economy moves towards in a stochastic process.

     

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    Quote: "The Malthusian law of population is one of the great achievements of thought.  Together with the principle of the division of labor it provided the foundations for modern biology and for the theory of evolution...The objections raised against the Malthusian law as well as against the law of returns are vain and trivial. Both laws are indisputable. But the role to be assigned to them within the body of the sciences of human action is different from that which Malthus attributed to them."

    Ludwig Von Mises

    Human Action

    Chapter XXIV, Section 2. Page 663
    -664

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    Vitor replied on Mon, Mar 8 2010 7:09 PM

    I cant stand Samuelson, extremely vain, got high on his own positivism, but his eyes couldn't interpret a single yard of the real world properly.

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    Merlin replied on Tue, Mar 9 2010 1:44 AM

    I too must say that Malthus is far, far, far from making in the top 10. His theory was correct back than (people stopped acting like rats only lately) and perfectly fitted what could be observed about population until the industrial revolution (only when people stopped behaving like rats, was the accumulation of capital though savings possible). Be it on this account, I‘m sure than many worse economists can be found to replace the guy.

     

    Also I find it preposterous that we mention Ricardo here. Of course his labor theory of value was trash, but it wasn’t his theory, rather deals back at the very least to Smith (and probably to protestant thought, as Rothbard points out). On the other hand Ricardo’s theory of international trade was the very first scientific analysis of the division of labor and, indeed, the only proof that anarchy is viable as a social system. And we give this guy “dishonourable mention”?!

    The Regression theorem is a memetic equivalent of the Theory of Evolution. To say that the former precludes the free emergence of fiat currencies makes no more sense that to hold that the latter precludes the natural emergence of multicellular organisms.
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    Conza88:

    "Marx’s economic teachings are essentially a garbled rehash of the theories of Adam Smith and, first of all, of Ricardo."

    ~ Theory and History, pp. 124–25

    Emphasis on "garbled rehash".

    To make sure the above quote isn't misinterpreted, Mises, unlike Rothbard, had great respect for Smith, and especially Ricardo.

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    Jon Irenicus:

    Even though the classicals were wrong and their arguments led to much confusion later in some respects, I wouldn't be willing to include them on this list. They may not have been the best economists but they were far from the worst.

    QFT

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    Esuric replied on Tue, Mar 9 2010 3:24 AM

    GeneralTelegraph:
    Quote: "The Malthusian law of population is one of the great achievements of thought.  Together with the principle of the division of labor it provided the foundations for modern biology and for the theory of evolution...The objections raised against the Malthusian law as well as against the law of returns are vain and trivial. Both laws are indisputable. But the role to be assigned to them within the body of the sciences of human action is different from that which Malthus attributed to them."

    Great, but Malthus was simply wrong. His logic may have been sound, on this issue, but his fundamental premise was incorrect: human beings are not like rats who continuously and mindlessly multiply. Either way, as I've already mentioned, even if we exclude the Malthusian trap, he is still responsible for all underconsumption/overproduction arguments (that the acquisition of too much wealth can cause depressed business activity), and for the so-called "paradox of thrift."

    "If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion."

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