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Is there a fundamental repudiation to Austrian economics? All I know about them is that they don't like funny money, which to me as a systems thinker is perfec

Is there a fundamental repudiation to Austrian economics? All I know about them is that they don't like funny money, which to me as a systems thinker is perfectly reasonable. At worst you would expect it to be harmful, at best to obscure what is really going on.

atwrk 2y ago
Contrary to serious economists Austrians try very hard to avoid specific forecasts, but we all can nonetheless look at their writings and compare what actually happened during every crisis in the last 50 years - and nothing Austrians are postulating proved correct. Or just look at the very last, covid caused one: If you'd been doing prognoses with textbook keynesianism regarding inflation, demand, stimulus effects and so on, you'd been pretty spot on. Just read the old blog posts from krugman from 2020 onwards as an example. The Austrians, by comparison, predicted 5 of the last 0 hyperinflation scenarios correctly.
Nursie 2y ago
Where mainstream economics is imprecise and frequently inaccurate, and credited with predictive powers it simply doesn't possess, it is at least an attempt to study economic reality. 'Austrian' economics is more akin to a religion, with associated dogma and moral tenets.
throwawaymaths 2y ago
if you go down the austrian rabbithole weird stuff around praxis starts showing up. which is like logically true but probably unuseful (IMO) and used by the community to shut down any ideas from outside Austrianism. i think focusing on M0 is also incorrect. the debt money multiplier is a real phenomenon, and at least the psyche of a user of the banking system must be accounted for.
_0ffh 2y ago
Not a valid one at least.
dragonwriter 2y ago
Austrian economics is openly an ideological movement and not a system of empirical predictive theory, and thus is inherently unfalsifiable in the broad sense. Individual Austrian-school economists sometimes make falsifiable predictions, and they are often (either knowably at the time or determined later) false, but that's a different issue, because, again, those predictions are not grounded (in the predictive sense; while they are in an emotive sense) in the fundamentals of the school in a way which would make falsifying them a “repudiation” for anyone at risk of adhering to the school in the first place.

atwrk 2y ago

Contrary to serious economists Austrians try very hard to avoid specific forecasts, but we all can nonetheless look at their writings and compare what actually happened during every crisis in the last 50 years - and nothing Austrians are postulating proved correct. Or just look at the very last, covid caused one: If you'd been doing prognoses with textbook keynesianism regarding inflation, demand, stimulus effects and so on, you'd been pretty spot on. Just read the old blog posts from krugman from 2020 onwards as an example. The Austrians, by comparison, predicted 5 of the last 0 hyperinflation scenarios correctly.

Nursie 2y ago

Where mainstream economics is imprecise and frequently inaccurate, and credited with predictive powers it simply doesn't possess, it is at least an attempt to study economic reality. 'Austrian' economics is more akin to a religion, with associated dogma and moral tenets.

throwawaymaths 2y ago

if you go down the austrian rabbithole weird stuff around praxis starts showing up. which is like logically true but probably unuseful (IMO) and used by the community to shut down any ideas from outside Austrianism. i think focusing on M0 is also incorrect. the debt money multiplier is a real phenomenon, and at least the psyche of a user of the banking system must be accounted for.

_0ffh 2y ago

Not a valid one at least.

dragonwriter 2y ago

Austrian economics is openly an ideological movement and not a system of empirical predictive theory, and thus is inherently unfalsifiable in the broad sense. Individual Austrian-school economists sometimes make falsifiable predictions, and they are often (either knowably at the time or determined later) false, but that's a different issue, because, again, those predictions are not grounded (in the predictive sense; while they are in an emotive sense) in the fundamentals of the school in a way which would make falsifying them a “repudiation” for anyone at risk of adhering to the school in the first place.