The Anarchist Principle

[MagiDragon]

One last difference between Austrians and others: Austrians have a different definition of inflation. Most economists say the change % in the CPI from year to year; Austrians say the change in money supply from year to year, and they say the change in the CPI measures the *effects* of inflation.

[Socrates]

nm

Edited April 5, 2011 by Socrates

[Laudate_Dominum]

[quote name='MagiDragon' timestamp='1301932064' post='2225860']
I've been away for years, but this makes it look to me like we have some Austrian School Economists on the site, now. Am I correct? If so, who are they?

Also, count me in their number.
[/quote]
'Tis quite the thing these days. I'm into aboriginal Australian economics personally.

[Laudate_Dominum]

[quote name='Socrates' timestamp='1301963556' post='2225993']
nm
[/quote]
now i'm all curious.

[Ed Normile]

True Austrian economics are a pipe dream that could bever be realized in any society. In effect it would mean trade without any government or state involvement such as taxes or trade restrictions etc. In its purest form it would imply you trading the potato you grew for my piece of paper I drew my image on and wrote three dollars Ed States of Utopia. This laissez faire style of trade could never be realized in any regulated societal setting, maybe if we went back to living in caves ...

ed

[Nihil Obstat]

[quote name='Ed Normile' timestamp='1301977500' post='2226059']
In its purest form it would imply you trading the potato you grew for my piece of paper I drew my image on and wrote three dollars Ed States of Utopia. [/quote]

Why would someone consent to that trade? Your piece of paper is worthless.
In fact, your scenario is much more like our current system of fiat currency, except in that case you also implicitly threaten to lock up or kill the guy with the potato if he doesn't accept your worthless paper.

[Vincent Vega]

[quote name='Ed Normile' timestamp='1301977500' post='2226059']
True [s]Austrian economics are[/s] Anarchy is a pipe dream that could bever be realized in any society.
ed
[/quote]
fxd

[Nihil Obstat]

[quote name='USAirwaysIHS' timestamp='1301979941' post='2226068']
fxd
[/quote]
[img]http://fc07.deviantart.net/fs16/f/2007/184/c/3/Fish_Slap_by_KyuubiDaGatorGirl.gif[/img]
I will come over there. I swear I will.

[Vincent Vega]

As long as I get to be Johnny Knoxville, you can slap me with a fish anytime you like.

[Nihil Obstat]

[quote name='USAirwaysIHS' timestamp='1301982962' post='2226072']
As long as I get to be Johnny Knoxville, you can slap me with a fish anytime you like.
[/quote]
[img]http://upload.wikimedia.org/wikipedia/commons/archive/5/58/20091012151216!Justin_Bieber.jpg[/img]

[Nihil Obstat]

I just remembered that teh Biebs got a haircut. You know what that means? Teh Biebs has a manlier haircut than you.

[4588686]

[quote name='AudreyGrace' timestamp='1301950151' post='2225924']
Going out on a limb and admittedly sounding ignorant here, but, what is the Austrian School / Austrianism? Lately I've been trying to find a political and economic group that best fits me. I was going to register Republican... but then I realized I don't really like the Republican Party all that much lol (Democrats either. I have huge problems with both parties). I could always wikipedia Austrian School, but I don't want to misinterpret anything.
[/quote]


[url="http://www.slate.com/id/9593"]http://www.slate.com/id/9593[/url]

I'm hardly an expert in economics. Most of what I know about economics comes from studying the USSR and the empirical shortcomings of centralized planning. That said, I've never been impressed with Austrian economics. I cannot claim to have exhaustively looked into the school. Not even close. But the Austrian economics writtings that I have read tend to lack analytical rigor. It tends to be a lot of vague, unfalsifiable pronouncements without a lot of empirical or mathematical rigor. That's not to say that it's wrong. Just that it rubs me the wrong way. I've also noticed that the people drawn to it tend to not be individuals you value rigorious analysis but rather value narrative and thought experiments. Neither of those are anathema in themselves to good reaserch, a lot of great mathematics starts in thought experiments. But at some people those thought experiments have to lead to some hard evidence beyind more though experiments. That the people who tend to value the Austrian school tend to lack rigor makes me suspect that my sampling of the school is not totally unrepresentative of the the school in itself.

You may just like to read Hayek. From what little I've read he seems to be a pretty clear and interesting.

[MagiDragon]

[quote name='Hasan' timestamp='1301984664' post='2226076']
But the Austrian economics writtings that I have read tend to lack analytical rigor. It tends to be a lot of vague, unfalsifiable pronouncements without a lot of empirical or mathematical rigor. That's not to say that it's wrong. Just that it rubs me the wrong way. I've also noticed that the people drawn to it tend to not be individuals you value rigorious analysis but rather value narrative and thought experiments. Neither of those are anathema in themselves to good reaserch, a lot of great mathematics starts in thought experiments. But at some people those thought experiments have to lead to some hard evidence beyind more though experiments. That the people who tend to value the Austrian school tend to lack rigor makes me suspect that my sampling of the school is not totally unrepresentative of the the school in itself.
[/quote]

This charge always gets thrown at the Austrians, but it actually *should* apply to all schools of economics. Name one school of economics that has said "Oh well, our model was just empirically proven incorrect. I guess we need to abandon that theory." Instead, they say, "Well things would have been much worse if we hadn't done what we told you to do." or "We just didn't do *enough* of our theory!" (Look at every proposal and result that Paul Krugman makes, every time he uses these arguments!) If you think about it, it's much less intellectually honest to say either of those things than it is to say "Well, we can tell you that this is a worse scenario than it would have been had we *not* done this, but we really can't tell you how much worse."

What you call 'rigor' is something that Austrians say cannot *truly* be applied to economics: Unlike subatomic particles or physical objects, people make (semi-)rational choices. This causes it to be impossible to eliminate variables to the point that an experiment can be repeated; even if you did the same experiment on the same small town, they'll behave differently the second time. This is partially due to the Observer Effect, and partially due to human's ability to learn. Even it if was possible to repeat an experiment on the entire economy, it would possibly be unethical to do so.

Did that take care of your objections?

Peace,
Joe

[4588686]

[quote name='MagiDragon' timestamp='1302011941' post='2226098']
This charge always gets thrown at the Austrians, but it actually *should* apply to all schools of economics. Name one school of economics that has said "Oh well, our model was just empirically proven incorrect. I guess we need to abandon that theory." Instead, they say, "Well things would have been much worse if we hadn't done what we told you to do." or "We just didn't do *enough* of our theory!" (Look at every proposal and result that Paul Krugman makes, every time he uses these arguments!) If you think about it, it's much less intellectually honest to say either of those things than it is to say "Well, we can tell you that this is a worse scenario than it would have been had we *not* done this, but we really can't tell you how much worse."[/QUOTE]

I don't quite understand your argument. I'm not talking about Krugman's op-ed articles when I'm comparing Austrian economics to other schools. I don't know enough about economics to consider myself a part of any school. I would say in Paul Krugman's defense that he didn't exactly say that the stimulus would work and when it didn't he said it just wasn't enough. He made very clear before hand that the stimulus passed wasn't enough under Keyensian theory has had a pretty low probability of working. I also think that Krugman would be the first to tell you that what he writes in the NYT is not hard economic writtings. It's his attemt to argue policy-briefly and not-comprehensively-in a popular format.

I do think that other schools make testable pronouncements and adjust themselves when proven wrong. As I understand it stagflation was impossible under Keyensian theory. Hence the emergence of neo-Keyensianism



[QUOTE]What you call 'rigor' is something that Austrians say cannot *truly* be applied to economics: Unlike subatomic particles or physical objects, people make (semi-)rational choices. This causes it to be impossible to eliminate variables to the point that an experiment can be repeated; even if you did the same experiment on the same small town, they'll behave differently the second time. This is partially due to the Observer Effect, and partially due to human's ability to learn. Even it if was possible to repeat an experiment on the entire economy, it would possibly be unethical to do so.

Did that take care of your objections?

Peace,
Joe
[/quote]

Every social science operates under those constraints. That doesn't mean that you can't use rigor. It's hard for me to link you to an article unless you have a JSTOR account but scholars studying international conflict have long used game theory coupled with statistical analysis to make important findings into why countries go to war. As far as I know other economics schools are also able to use theoretical models tested against empericle evidence and statistical evaluation. Yes. These lack the rigor of physics because we can't run experiments the same way a physicist can and if you read MacIntyre's "After Virtue" he himself investigates some of the shortcomings of the social sciences. But despite these limitations reaserchers are able to ake solid findings and make testable predictions and claims.

[Ed Normile]

[quote name='Nihil Obstat' timestamp='1301978519' post='2226064']
Why would someone consent to that trade? Your piece of paper is worthless.
In fact, your scenario is much more like our current system of fiat currency, except [b]in that case you also implicitly threaten to lock up or kill the guy with the potato if he doesn't accept your worthless paper.
[/b][/quote]

I do not know why you would say that Nihil, I am quite a handsome guy and am pretty good at drawing too. Besides, I am sure you got my point, trade works only when there is consent between those who trade and only if it works within the framework of the laws of the area, this Austrian pipedream would allow for fair trade, trade with consent between individuals free of state laws or tariffs, yeah right, <-- (this is where I was tempted to use the bridge selling adage you guys are so fond of here to belittle lame sacrastic remarks, but that is so overused that is really annoying.)


The remark I bolded in the quote above? Are you referring to Obama's healthcare as that is the only time that the government has ever required anyone to buy a product forcefully, it has not been implemented yet, its unconstitutional and may be repealed or at least defunded.

ed