General

Re: Austrian Econ for Neoclassicals?

krazy kaju — Sat, 15 Jan 2011 15:07:58 GMT

No questions really - he criticized neoclassical economics for being too mathy. His main critique revolves around how people actually engage in decision-making (vs. using calc equations to calculate utility or compare different baskets of goods on indifference curves, etc.). I asked him in class about the nature of behavioral economics, because it seemed like there was no general theory or superstructure to it all. He said there wasn't any kind of theoretical structure; that it was more like a bunch of anecdotes thrown together. Now, I like to joke by referring to the class as "Zen Economics." The prof has structured the class more as an open-minded discussion, where we discuss various models and so forth, while learning about neoclassical models and what behavioral economists have to say about them. The structure of the class leads me to believe that the prof doesn't know much about real world economics, and he realizes this. He is looking for answers in behavioral economics, a relatively new field.

I'm not really expecting to "convert" him or anything, just maybe to open his mind a little bit.

Re: Austrian Econ for Neoclassicals?

Esuric — Sat, 15 Jan 2011 14:48:28 GMT

Instead of Hayek... Would Israel Kirzner be better? Specifically The Economic Point of View?

I had a few professors that were behavioral/new institutional economists and they had a lot of respect for Kirzner and Hayek. They basically endorse the Austrian conception of rationality (what they would call 'bounded rationality') and tend to employ a realistic approach relative to new classicism (which isn't really saying much). Behavioral economics says some pretty interesting things but as a whole it's fairly barren. It tends to over-stress 'irrationality," dismisses the price mechanism, and focuses too much on psychological variables (as opposed to real economic factors).

Behavioral economics may become mainstream in the field of financial economics but I doubt it. New institutional economics is much more fruitful imo.

Re: Austrian Econ for Neoclassicals?

Metus — Sat, 15 Jan 2011 14:35:01 GMT

What are those results that contradict neoclassical theory? Contradict the results Austrian Theory?

Re: Austrian Econ for Neoclassicals?

EconomistInTraining — Sat, 15 Jan 2011 14:28:38 GMT

Behavioural economics probably isn't so much against the mainstream so much as it is quickly becoming part of the mainstream. Whilst there's no doubt that a lot of the results of behavioural economics are in conflict with established neoclassical theory, the question becomes whether or not these results are trivial or meaningful.

That said, it's a really interesting field of study and one I would endorse most people to study.

Re: Austrian Econ for Neoclassicals?

nirgrahamUK — Sat, 15 Jan 2011 14:08:42 GMT

krazy kaju:
The prof is very much against mainstream economics and it's pretty obvious that he doesn't think he knows the right answers; he is looking for the right answers.

What are the questions?

Re: Austrian Econ for Neoclassicals?

krazy kaju — Sat, 15 Jan 2011 13:34:48 GMT

Instead of Hayek... Would Israel Kirzner be better? Specifically The Economic Point of View?

Austrian Econ for Neoclassicals?

krazy kaju — Sat, 15 Jan 2011 12:42:34 GMT

I have a microeconomics course that is taught by a behavioral economist this semester. The prof is very much against mainstream economics and it's pretty obvious that he doesn't think he knows the right answers; he is looking for the right answers. I'll probably be bringing up the Austrian school either in class or in person with the prof. What are some good books to give as suggested reading?

I'm thinking that something by Hayek might be a good place to start for someone who has been schooled in neoclassical and Keynesian economics... But I don't really know, since I've never actually read Hayek. Any suggestions?