In discussing economics with a person, they made the claim that Austrian economics is unscientific. When asked how it is unscientific, they simply linked the following link.
How would mises.org respond to this:
http://www.huppi.com/kangaroo/L-aussm.htm
I am an Engineer. I will tell you this. To predict an outcome you must understand the fundamental principles underlying the topic under consideration. The principles of chemistry, physics, thermodynamics, electronics, etc.. are all logically derived from laws - facts. Principles that are derived from facts & laws (axioms) are sound and last the test of time. Austrian Econ. is a science, not necessarily based on statistics, mathematical models and theories, but based on logic derived principles from facts underlying human behavior.
Modern day economics consist of simplistic models, diagrams, math and jargon. Many created to model observed past statistics. This is not science. It's curve fitting. You cannot fundamentally predict the outcome of an event based on curve fitting. Modern day economics is not science. It's guess work.
Maybe it depends on what you perceive as either a principle or law.
I learned the first, second "laws" of thermodynamics in school. While they can be illustrated from empirical means they also can be derived from quantum physics... which I have not studied in any dept.
I learned the conservation "laws" of energy.
I learned Newton's first, second and third "laws" of motion.
I learned the work-energy "principle" that was derived from quantum physics using the above laws.
http://hyperphysics.phy-astr.gsu.edu/hbase/hframe.html
bearing01: Maybe it depends on what you perceive as either a principle or law. I learned the first, second "laws" of thermodynamics in school. While they can be illustrated from empirical means they also can be derived from quantum physics... which I have not studied in any dept. I learned the conservation "laws" of energy. I learned Newton's first, second and third "laws" of motion. I learned the work-energy "principle" that was derived from quantum physics using the above laws. http://hyperphysics.phy-astr.gsu.edu/hbase/hframe.html
Out of personal curiosity, what kind of engineer are you? I'm currently working on a degree in Electrical Engineering.
I'm just wondering, what would you say to those who absurdly think that mathematics is an experimental science or who think that even the statement "there is truth" is not axiomatic but only empirical? How could they possibly believe this?
No one, or next to no one, thinks it is experimental, pace Mill (and if anyone here buys into that view, I suggest Frege as an antidote.) The more common approach (both towards it and geometry) is that it is conventional. Even the Fregean notion of analyticity as the logical substitution of equivalent statements or truths has been abandoned (Frege, Russel and the earlier Wittgenstein IIRC hoped to show that mathematics reduced to logic, and thence derived its apodeicticity.) So the argument you must deal with is that it's conventional, not that it's "empirical", whatever it'd mean for a mathematical statement to be "empirical" (zero is a huge problem for the empirical approach BTW, as are negative numbers, calculus - because of infinitely small steps - &c.) Hoppe raises some interesting points regarding mathematics, hylometry &c. being the very bases of measurement itself, the sine qua non of the experimental sciences, a sort of protophysics (he expands on this in The Economics & Ethics of Private Property and Economic Science and the Austrian Method,) so it is curious that one would think of it itself as experimental. The second statement cannot be justified by direct observation, and is ruled out by induction or experimentation because inferential reasoning is itself aprioristic. If there is no a priori, there is only direct observation, and maybe not even that much (because one still needs to apply the law of contradiction)...
Another thing to keep in mind is that aprioricity concerns how something is justified (and hence known), not the source of the knowledge itself, which ultimately is sensual/perceptual.
Freedom of markets is positively correlated with the degree of evolution in any society...
I am concerned that people can't seem to distinguish between inductive, deductive, and abductive reasoning.
science is pure induction. social theories are deductive or abductive (austrian is deductive, a school that appeals to history would be abductive). deduction and abduction are what we use in situations where we can't create repeatable falsifiable experiments.
no economic theory is scientific. a lot of people seem to be using a loose interpretation of science.
I'm an Electrical Engineer. I design radios for cell phones.
So if Economics cannot be scientific then would you say that Psychology is not a science? It is the study of human behavior. When I studied it they called it a science.
http://www.psychnet-uk.com/training_ethics/whatispsych.htm
science is pure induction.
In its modern usage, yes. However, excessive dependence on the so-called scientific method has led some like Popper to exclude substantial parts of biology (e.g. Darwinian theory of evolution) from being science because they do not fit into this straightjacket. The ancients certainly included knowledge regarding first principles as part of science (the "demonstrables") and I think the tendency persisted up until positivism. Why the positivist fetish of restricting science to a particular model of acquiring knowledge should be accepted is beyond me, especially since science simply does mean knowledge, or more appositely certain procedures of acquiring it - why should only one be thought of as conducive to truth, to the exclusion of all others? Different domains of inquiry merit different approaches. Again, the writings of Kuhn and Feyerabend are good therapeutics in this case.
Didn't Hayek touch on this subject in the Counter Revolution of Science? First part I believe, he explains the difference between science and Science as came about in the 19th Century. All areas of the social or moral sciences are unScientific, in the strict sense. That is hardly a condemnation, however there is a lot of baggage that can be smuggled in with such an assertion.
“Elections are Futures Markets in Stolen Property.” - H. L. Mencken
Does anyone have any links detailing Austrians predicting things throughout the 20th century? I remember reading somewhere that Mises himself predicted the Great Depression. What about stagflation? What about the price of gold after the dollar was unpegged from it? What about the S&L crisis, etc?
I'm just trying to get a feel for this aspect of it all.
Mises predicted the great depression.
Austrians predicted the 2009 depression. Peter Schiff is the most popular Austrian follower that said it would happen while the Keynesians all laughed at him.
Reading Rothbard's "America's Great Depression" and reading about how/why it happened is like reading a diary explaining what happened in 2002-2007, eventhough his book was written in the 1960's. Anyone who subscribes to the Austrian theory of the trade cycle could see this bust, the S&L and the 1929 great depression could see it coming from miles away. Keynesians and Monetarists couldn't. In 1920's the advances in production and technology should have naturally made consumer prices fall (not deflation) but because the Fed inflated the money supply it kept prices stable. Monetarists perceived this as a healthy economy with no inflation. Keynesians were lost for words and didn't know if the gov't should raise taxes (take away money to cool inflation) or increase deficit spending (to support prices) because they didn't see any problem until after the bust and deflation began. Austrians however saw the inflation in the money supply and knew a bust was inevitable, eventhough there was increased productivity and savings.
bearing01: Mises predicted the great depression. Austrians predicted the 2009 depression. Peter Schiff is the most popular Austrian follower that said it would happen while the Keynesians all laughed at him. Reading Rothbard's "America's Great Depression" and reading about how/why it happened is like reading a diary explaining what happened in 2002-2007, eventhough his book was written in the 1960's. Anyone who subscribes to the Austrian theory of the trade cycle could see this bust, the S&L and the 1929 great depression could see it coming from miles away. Keynesians and Monetarists couldn't. In 1920's the advances in production and technology should have naturally made consumer prices fall (not deflation) but because the Fed inflated the money supply it kept prices stable. Monetarists perceived this as a healthy economy with no inflation. Keynesians were lost for words and didn't know if the gov't should raise taxes (take away money to cool inflation) or increase deficit spending (to support prices) because they didn't see any problem until after the bust and deflation began. Austrians however saw the inflation in the money supply and knew a bust was inevitable, eventhough there was increased productivity and savings.
Do you have any links that clearly demonstrate that they saw it coming from a mile away?
Also, quick question that is somewhat unrelated to this: What was Rothbard's view on utility theory exactly? I've heard people claim he threw it out because he thought it imposed cardinality and that he was wrong for this.
(sorry, just didn't want to start a whole new thread for this and nothing seemed to come up fruitful with the search function.)
No, he did claim to reconstruct it though. What you must mean are indifference curves. There's a lot of work on this by Hoppe, Block, Hulsmann (some in response to Caplan) &c. which I've not yet read but which you should if the topic interests you, as well as Rothbard's original paper on utility and welfare economics.
Jon Irenicus: No, he did claim to reconstruct it though. What you must mean are indifference curves. There's a lot of work on this by Hoppe, Block, Hulsmann (some in response to Caplan) &c. which I've not yet read but which you should if the topic interests you, as well as Rothbard's original paper on utility and welfare economics.
Thanks Jon.
Where can I find these at?
On the Mises website, just search for them (or indifference analysis/curves.) I'm pretty sure Inquisitor included them on the Praxeology reading list in the economics section, though.