Does anyone know of any attempts at what might be called a "Keynesian-Austrian synthesis" other than Garrison's work? I've sketched something out recently that I want to try and make more formal and I'm curious what other work has been done - I haven't come across much. One concern I have with Garrison is that there are parts where he (1.) assumes full employment, and (2.) constrains his version of the Keynesian model to a loanable funds theory of the interest rate. Both essentially rob Keynesianism of its central point, of course!
I'm working on a pretty standard IS-LM framework that doesn't do what Garrison did, but which includes a capital structure as in Prices and Production. Has anything like this been done before that I ought to be aware of?
pentahedron:but I also recall reading that it's critized by some Austrians because its attempts at modeling.
Please don't just "recall". I would love to see a single source that you can provide that critizes his "attempts at modeling".
Thanks Daniel I'll be sure to read it! DD5: The diagrammatical exposition of this model has much aesthetic appeal, and thus it might not be unreasonable to expect that Garrison-style macroeconomics will make Austrian converts among mainstream economists and their students. Yet there is also the possibility that Garrison not so much succeeds in Austrianizing the mainstream as that he will mainstream the Austrians. For the fact remains that Garrisonian macroeconomics is essentially neoclassical macroeconomics, which he enriches with an Austrian model. His main concern is not so much with economic analysis as with representing the results of a foregoing economic analysis; and the elements of the analysis and representation are not individual human actions, but quantities of things that are subject to human action. We will now have to inquire whether and to what extent his attempt has been successful.
Garrisonian Macroeconomics by Jorg Guido Hulsmann
Quarterly Journal of Austrian Economics
Great - thanks.
Yes, really the point is "presenting Prices & Production in a new light". That definitely holds the potential for leaving many Misesians especially behind.
Hayek built the business cycle theory elucidated by Garrison from Mises' theory, so I hardly see how that would be the case.
pentahedron: Thanks Daniel I'll be sure to read it! DD5: The diagrammatical exposition of this model has much aesthetic appeal, and thus it might not be unreasonable to expect that Garrison-style macroeconomics will make Austrian converts among mainstream economists and their students. Yet there is also the possibility that Garrison not so much succeeds in Austrianizing the mainstream as that he will mainstream the Austrians. For the fact remains that Garrisonian macroeconomics is essentially neoclassical macroeconomics, which he enriches with an Austrian model. His main concern is not so much with economic analysis as with representing the results of a foregoing economic analysis; and the elements of the analysis and representation are not individual human actions, but quantities of things that are subject to human action. We will now have to inquire whether and to what extent his attempt has been successful. Garrisonian Macroeconomics by Jorg Guido Hulsmann Quarterly Journal of Austrian Economics
How is the above a critique of his "attempts at modeling"?
re: <i>"Hayek built the business cycle theory elucidated by Garrison from Mises' theory, so I hardly see how that would be the case"</i>
Precisely because Hayek's business cycle theory in no way exclusively relies on praxeology, and precisely because he fails to give it a praxeological grounding. Strict praxeologists may have an issue with certain treatments of it. Certainly you can acknowledge that it holds the potential for ruffling some Misesian feathers.
DD5:
Just from what I posted he states that it's basically a Mainstream model with an Austrian touch and that it's attempting to quantify human action. I cited the journal entry for you to read for yourself and see what about Garrisons work he has a problem with.
It's like Daniel just said and what I thought of when I first heard about Garrisons model: strict praxeologist would have more of an issue with his modeling compared to Hayekians found in places such as GMU.
Daniel Kuehn: re: <i>"Hayek built the business cycle theory elucidated by Garrison from Mises' theory, so I hardly see how that would be the case"</i> Precisely because Hayek's business cycle theory in no way exclusively relies on praxeology, and precisely because he fails to give it a praxeological grounding. Strict praxeologists may have an issue with certain treatments of it. Certainly you can acknowledge that it holds the potential for ruffling some Misesian feathers.
Whatever differences there are between Hayek's and Mises's beliefs about the nature of knowledge, their theoretical and non-hypothetico-experimental approaches are broadly the same. The minor qualms Misesians have with Hayek's business cycle theory (like for example the Ricardo Effect) have to do with differing theoretical conclusions, not differing methodology.
pentahedron:he states that it's basically a Mainstream model with an Austrian touch
That's not a critique against an "attempt to model". It's a critique of a particular model (or an approach).
Do you not see the difference or are you intentionally evading it? Because this difference is huge. It's like saying someone is against scientific theory, when in fact, he is only criticizing a particular scientific theory
DD5: I said his work is being critized for its attempts at modeling which is exactly what's going on in that paper. I did not say he was being critized for simply attempting to model. You either misread what I wrote or you're looking to start an argument over a non-issue.
DD5:Do you not see the difference or are you intentionally evading it?
You are bringing up an important distinction, and pentahedron would do well to learn from you, but let's not be so quick to call another forum member's intellectual honesty into question.
Daniel,
Precisely because Hayek's business cycle theory in no way exclusively relies on praxeology, and precisely because he fails to give it a praxeological grounding.
I'm not so sure this is true. Hayek is no praxeologist, but his methodology is very close. See his discussion on methodology in Monetary Theory and the Trade Cycle.
Ludwig Lachmann called himself an 'Austro-Keynesian' and his work has similarities to the Post-Keynesianism of today.
I do need to read more Lachmann, but any of these various post-Keynesian/Austrian affinities that crop up aren't necessarily going to be sympathetic to the thoroughly neoclassical synthesis Keynesianism I'm thinking about!
Jonathan -
Right, I'm not saying there's a huge gulf between the two men. But there's nothing particularly praxeological about his work in Prices and Production. Hayek certainly took many fruitful approaches. I think the capital structure has the best potential for integration with mainstream theory.