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Why is empirical evidence not supported by Austrian economics?

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No2statism Posted: Sun, Nov 18 2012 1:25 PM

I was thinking it is because not all evidence is necessarily unequal to all other evidence, because there are too many types of evidence and because evidence (especially when attempted to be made hierarchical), doesn't lead to the truth more than half the time.

Why is empirical evidence not supported by Austrian economics?  What was wrong with my reasoning and/or how did it not apply?

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Wheylous replied on Sun, Nov 18 2012 1:30 PM

Why is empirical evidence not supported by Austrian economics?

Wait, why is it unsupported? What does this even mean? Austrians are not against empricial evidence.

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It helps to keep things simple. They're against usage of the hypothetico-deductive methodology in economics because:

1) Economies are not things you can stick in petri dishes or on computers and perfectly simulate.

2) Economic "facts" need to be isolated from other aspects of human action, which requires prior theory for their identification, to generate the concepts economics utilises, e.g. money.

3) In addition to the above, this also means that due to the operation of multiple facts at once, it isn't easy to simply determine causality by way of correlations.

4) Humans often react to policies based on predictive models and upset them.

5) The natural sciences deal with inanimate objects that follow predictable patterns. They try to infer correlations by positing hypotheses and then testing to see how well these hypotheses fit the data. Even then, they are still theory-laden.

 

Be that as it may, Austrianism isn't against "empirical evidence", but particular (supposed) forms of empiricism, such as the moronic ideology of positivism. It just considers empirical "facts" rather useless for testing economic theories. This is partially due to the language used. Mises was a Kantian, and as such worked from within that framework. The synthetic a priori is meant to be "empirical" in the sense that it applies to the world and is discernible in highly certain facts of life. Aristotelians frame the Austrian epistemology in slightly different terms, particularly with respect to how concepts are formed, but arrive at similar conclusions.

 

If you're up for a reading challenge, I'd suggest you gave Holiis and Nell's Rational Economic Man a read in addition to Mises and Hoppe.

 

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

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what jon said.

 

I would also like to mention that AE recognizes and has no problem with indvidual actors using empirical evidence to make future predictions.  

It is against economists claiming something is an economic/scientific truth based on that very evidence.  To suggest so would mean people's wants dont change, people dont have free will, and you can predict the future.

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I'm learning more about AE, and this is the first I've run across this idea that it doesn't support empirical evidence. Is this why there are references to a priori reasoning by Mises and a few other writers? I say a posteriori reasoning is sound, and I would argue from a classical perspective that empiricism is our entire basis of knowledge. Are there any platonists in the forum that actually maintain knowledge is obtained by any other means than experience?

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Wheylous replied on Sun, Nov 18 2012 2:34 PM

TR, once again, AE is not against empirical knowledge. It's against arbitrary regression analysis.

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