Political Theory

Re: Is there anything that the Austrians and the Keynesians DO agree on?

JAlanKatz — Mon, 30 Aug 2010 01:08:01 GMT

The question asked about theory. Why has every answer been about policy?

Re: Is there anything that the Austrians and the Keynesians DO agree on?

fakename — Sat, 28 Aug 2010 20:51:57 GMT

well I think that is true, but as long as they think money is non-neutral in the short term; I count them as viewing it as "non-neutral".

It's why I said "to an extent".

Re: Is there anything that the Austrians and the Keynesians DO agree on?

Orthogonal — Sat, 28 Aug 2010 20:38:48 GMT

Not sure, but a simplification of the schools of thought would be. Keynesians focus on nominal growth. AE focus's on value-free voluntary exchange.If a scenario occurs where these two overlap, there would be agreement.

Re: Is there anything that the Austrians and the Keynesians DO agree on?

hugolp — Sat, 28 Aug 2010 19:19:47 GMT

To an extent I think AE and KE both agree on the non-neutrality of money and the primacy of uncertainty (animal spirits).

I though keynesians believe that money is not neutral in the short term but its neutral in the long term. Can anyone confirm?

Re: Is there anything that the Austrians and the Keynesians DO agree on?

Merlin — Sat, 28 Aug 2010 18:16:04 GMT

Both agree that raising taxes during a depression would be dumb. I’m afraid that’s about it.

Re: Is there anything that the Austrians and the Keynesians DO agree on?

Prateek Sanjay — Fri, 27 Aug 2010 09:26:32 GMT

Keynesians like Stiglitz have conceded to Hayek's argument on limitations of knowledge. As have many Scandinavian social democrats of the Stockholm School.

Stiglitz's agreement with limitations of knowledge of technocrats can be appreciated, if not for the fact that folks like Stiglitz still feel something "must be done" in spite of being well aware of limitations of knowledge.

It only makes me cringe further, however, when the Scandinavians use limitations of knowledge as a justification for public sector - saying that it's impossible to calculate on how a government education system should charge different students from families of different income levels in schools, and hence the only thing to do is to have only government funded schools with equal prices for both poor and rich and have equal government funding per student in all public schools, without having any private competition to cause misallocation of funds. It's one of those moments when their claims of limitations of knowledge in proper allocation of resources just makes you ask, "Then why not just have a private system and forget it?" Clearly, some schools will charge what the traffic will bear and some will charge higher for those who can afford it and so on.

But never mind - the point is that one can agree on the same thing for the wrong reasons.

Re: Is there anything that the Austrians and the Keynesians DO agree on?

Caley McKibbin — Fri, 27 Aug 2010 09:09:28 GMT

Keynesians are against a rise in prices?

Re: Is there anything that the Austrians and the Keynesians DO agree on?

FunkedUp — Fri, 27 Aug 2010 01:22:34 GMT

During an economics class I asked my professor why, if spending was so good for the economy, the stimulus measures weren't multiplied by tenfold. He responded by saying that the stimulus should have at least been doubled, but countered that multiplying it by tenfold would amount to inflation.

So in effect, Austrians and Keynesians agree that increasing the money supply creates inflation.

Re: Is there anything that the Austrians and the Keynesians DO agree on?

fakename — Fri, 27 Aug 2010 00:04:02 GMT

To an extent I think AE and KE both agree on the non-neutrality of money and the primacy of uncertainty (animal spirits).

Is there anything that the Austrians and the Keynesians DO agree on?

djussila — Thu, 26 Aug 2010 23:36:29 GMT

Does the Austrian school and the Keynesian school have any areas where they share that SAME economic theories?