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Are Non-Misesian Austrians Too Lazy or Too Statist?

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Ricky James Moore II posted on Sun, Feb 6 2011 9:43 PM

I was reading the Market Financial today and came across this post from last month:

 

Mises v. Hayek v. Boudreaux

Recently Cafe Hayek’s Don Boudreaux put up a list of his top ten economists. There was one glaring omission: Ludwig von Mises. I was absolutely bowled over by this. He mentions a lot of fine economists, with Friedrich von Hayek his number one choice. When asked about Mises he says:

Don: Mises has just never done it for me. I love his 1922 book Socialism, and his book Liberalism. He was a damn good economist, no doubt.

Reader: Have you read “Human Action?”

Don: Yep. Snooze.

I don’t know what to say other than that Boudreaux just slipped about 10 notches down on my list of respected economists. I hate to do that because he is one of the most prominent economists and figures in Austrian theory economics. I am a big fan of his “letters from Don,” his constant stream of letters to editors and his defense of free trade. Other than that I haven’t read any of his major works.

Here is my comment on the subject from Cafe Hayek:

Mises contributions to the intellectual foundations of social sciences and economics, as pointed out above were without peer. Think of his writings on epistemology as kind of a unified field theory of human action. But the problem with Mises was, well, Mises. He was known to be uncompromising, rigid, and one not to suffer fools lightly. Friedman commented on Mises in a deprecating way: at a Mont Pelerin Society meeting, Mises called many of his fellow attendees “socialists.” Also, Friedman said to effect that he (Mises) said you could know things just from theory. Imagine that. Well, Milton was wrong, his monetary theory was wrong, and he no understanding of epistemology. I greatly admire his defense of free markets and his role in the popular media, but, let’s face it, he was a monetary interventionist, the equivalent of economic central planning through the Fed. If you read Hulsmann’s bio of Mises, a great intellectual achievement in itself, you will get a sense of the man: fierce dedication to intellectual rigor and a desire to achieve truth above all else in his life. I don’t mean this to sound like a Mises hagiography, but I think his intellectual achievements were far superior to Hayek, and I agree with the commentators who say without Mises, there would have been no Hayek or Rothbard. I think Don and the others who think Mises is boring have just missed the point. That is, Mises is difficult, Old School, and hard to get into. Hayek is far more approachable. A great economist to be sure, but, as pointed out above, what did he contribute in economics that wasn’t founded on Mises?

It made me wonder: why do so many 'Austrians' stick to the inferior Hayekian analysis when they have to be aware of Mises? It is not even that they seem to disagree with Mises, it is more like they have never even read him. They typically have no interest in substantive analysis of methodology or epistemology in economics even though this is key to the difference between Austrian and mainstream economics. Instead they seem to practice 'economics' solely from the angle of technocratic policy recomenndations.

Is the divide caused by intellectual laziness or a simple aversion to radicalism which causes them to take up the sometimes social-democratic views of Hayek as against Mises?

I will break in the doors of hell and smash the bolts; there will be confusion of people, those above with those from the lower depths. I shall bring up the dead to eat food like the living; and the hosts of dead will outnumber the living.
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I don't think I agree with you about Hayek being inferior. I never was fond of praxeology to be honest. The majority of the conclusions are correct, yes, but Hayek methodology always seemed to be superior at explaining things like the organizing power of the price mechanism.

I am betting that our philosophical frameworks are hugely divergent, then. I don't agree with Mises on everything, but as an Aristotilian I think praxeology is obviously true. In fact, I would say it is nonsense to deny it.

I will break in the doors of hell and smash the bolts; there will be confusion of people, those above with those from the lower depths. I shall bring up the dead to eat food like the living; and the hosts of dead will outnumber the living.
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Esuric replied on Wed, Feb 9 2011 11:26 PM

I don't think I agree with you about Hayek being inferior.

Hayek makes a far broader argument regarding the role of prices in the formation of entrepreneurial expectations and decision making. While Mises focuses on profit/loss accounting which provides feedback loops regarding the correctness of entrepreneurial decisions, Hayek focuses on how such decisions are formed, and how they coordinate economic activity (the fact that prices guide production). He focuses on how prices reflect and convey tacit and idiosyncratic knowledge (as opposed to scientific knowledge), which is dispersed amongst billions of individuals, and which can't be formally expressed. His coordination argument, and Mises' calculation argument, are merely two sides of the same coin; they are interrelated.

Hayek, in many cases, merely takes Mises' ideas and expands upon them (the same way that Mises expanded upon Bohm-Bawerk's ideas).

"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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I haven't read Hayek, except something about intellectuals.  However, I heard Hoppe refer to Hayek's contribution as "Hayek's so-called contribution".  His criticism: the information problem is superfluous, whereas the information is by definition not available in the absence of genuine market prices.

BTW, there is not a binary set of options in "natural rights" and "consequentialism".

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BTW, there is not a binary set of options in "natural rights" and "consequentialism".

This is true.

I will break in the doors of hell and smash the bolts; there will be confusion of people, those above with those from the lower depths. I shall bring up the dead to eat food like the living; and the hosts of dead will outnumber the living.
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Ricky James:
I find Hayek roundabout

LOL!

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