5 ms·

http://johnquiggin.com/index.php/archives/2009/05/03/austrian-business-cycle-theory/ http://johnquiggin.com/index.php/archives/2009/05/03/austria... Also, htt

http://johnquiggin.com/index.php/archives/2009/05/03/austrian-business-cycle-theory/ http://johnquiggin.com/index.php/archives/2009/05/03/austria... Also, http://www.marginalrevolution.com/marginalrevolution/2010/04/krugman-on-austrian-business-cycle-theory.html http://www.marginalrevolution.com/marginalrevolution/2010/04... And, this is the most readable, but keep in mind that it's written by a Keynesian: http://www.slate.com/id/9593 http://www.slate.com/id/9593 Austrian economics, at its core, is based on praxeology and mostly rejects models, math and science. http://en.wikipedia.org/wiki/Praxeology http://en.wikipedia.org/wiki/Praxeology

hga 16y ago
I'd be a lot more interested in publications and comments from Austrians; the above are all from their critics and could all too easily be strawmen. The only useful way to approach this is to look at what Austrians themselves have said and what then happened.
yummyfajitas 16y ago
Praxeology doesn't reject models or science at all. It rejects reductionism - the claim is that you can't predict human behavior in a complex system based on observations of human behavior in simplified systems. Praxeology simply claims that you can't predict the economy based on experiments where you stick 30 college students into some iterated prisoner's dilemma scenario. Austrians strongly favor models, math and science. They just want robust models which are not sensitive to parameters, and econometrics of revealed preferences rather than highly controlled experiments.
- CWuestefeld 16y ago
  I'm a big fan of Austrians (I'm a complete Hayek groupie). But I don't think this is quite correct. It seems to me that Austrians really do stay away from mathematical models, at least. But they do have very strong logical models. The praxeology you refer to is really rooted in inductive logical reasoning. The difficulty is that these logical arguments depend on the rationality of the actors in the economy. And while Mises acknowledges that the real reasons for a person's actions may not even be known to one's self, more recent experimentation seems to show that at least in some situations, people really do not behave rationally. Anyway, if you're concerned about a lack of mathematical rigor, but are interested in Austrian ideas, you should look at the Chicago school, with luminaries such as Milton Friedman. The Chicagoans started from Austrian roots, but if anything, their attitude toward mathematical models is the opposite of the Austrians: they virtually invented much of the mathematical techniques that are employed by modern economists.
  - yummyfajitas 16y ago
    I think we disagree only on definitions. I'm treating Chicago as a subset (the majority, from what I've seen) of Austrians, you seem to be treating them as a separate group. I'm also not sure what you mean when you distinguish logical from mathematical models. Could you explain?
    - Perceval 16y ago
      Chicago and Austrian schools are separate groups, despite both being on the side of less government intervention. They have different philosophical/methodological roots, and have different histories of their interaction with government.
      - yummyfajitas 16y ago
        I stand corrected.
        lzw 16y ago
        I think monetary policy is the primary axis upon which these two schools are separated. Chicago is under sway Keynes when it comets minatory policy-- but note this is not the same as keynsianism which is a modern political theory that ignores the repercussions of easement that Keynes warned about. Austrians are pretty much hard money. There are some interesting comments made by rothbards and Friedman about each other ot illustrate the split. The schools reach similar conclusions on a number of issues, though. You already accepted they are separate, I'm just trying to add flavor here, not win a point.

hga 16y ago

I'd be a lot more interested in publications and comments from Austrians; the above are all from their critics and could all too easily be strawmen. The only useful way to approach this is to look at what Austrians themselves have said and what then happened.

yummyfajitas 16y ago

Praxeology doesn't reject models or science at all. It rejects reductionism - the claim is that you can't predict human behavior in a complex system based on observations of human behavior in simplified systems. Praxeology simply claims that you can't predict the economy based on experiments where you stick 30 college students into some iterated prisoner's dilemma scenario. Austrians strongly favor models, math and science. They just want robust models which are not sensitive to parameters, and econometrics of revealed preferences rather than highly controlled experiments.

CWuestefeld 16y ago
I'm a big fan of Austrians (I'm a complete Hayek groupie). But I don't think this is quite correct. It seems to me that Austrians really do stay away from mathematical models, at least. But they do have very strong logical models. The praxeology you refer to is really rooted in inductive logical reasoning. The difficulty is that these logical arguments depend on the rationality of the actors in the economy. And while Mises acknowledges that the real reasons for a person's actions may not even be known to one's self, more recent experimentation seems to show that at least in some situations, people really do not behave rationally. Anyway, if you're concerned about a lack of mathematical rigor, but are interested in Austrian ideas, you should look at the Chicago school, with luminaries such as Milton Friedman. The Chicagoans started from Austrian roots, but if anything, their attitude toward mathematical models is the opposite of the Austrians: they virtually invented much of the mathematical techniques that are employed by modern economists.
- yummyfajitas 16y ago
  I think we disagree only on definitions. I'm treating Chicago as a subset (the majority, from what I've seen) of Austrians, you seem to be treating them as a separate group. I'm also not sure what you mean when you distinguish logical from mathematical models. Could you explain?
  - Perceval 16y ago
    Chicago and Austrian schools are separate groups, despite both being on the side of less government intervention. They have different philosophical/methodological roots, and have different histories of their interaction with government.
    - yummyfajitas 16y ago
      I stand corrected.
      - lzw 16y ago
        I think monetary policy is the primary axis upon which these two schools are separated. Chicago is under sway Keynes when it comets minatory policy-- but note this is not the same as keynsianism which is a modern political theory that ignores the repercussions of easement that Keynes warned about. Austrians are pretty much hard money. There are some interesting comments made by rothbards and Friedman about each other ot illustrate the split. The schools reach similar conclusions on a number of issues, though. You already accepted they are separate, I'm just trying to add flavor here, not win a point.