Von Mises / Austrian School of Economics

Discussion in 'Business & Economics' started by w1z4rd, Jul 23, 2011.

  1. w1z4rd Valued Senior Member

    Messages:
    1,541
    We got an occultist from this group spamming one of our local forums with his intense libertarian capitalism of the Austrian school of economics.

    http://en.wikipedia.org/wiki/Austrian_School

    I find what this poster has to say pretty impractical. Like trusting private business with no regulation for essential services sounds pretty crazy to me.

    From what I understand is that the Austrian school of economics is different to mainstream economic models by the fact that it uses neither empirical evidence, the scientific method or mathematical models. This sounds pretty wooh to me.

    The libertarian perspective of no state and his market fundamentalist view of no regulation... seems impractical and counter productive considering the realities of societies.

    Whats your opinion on this?
     
  2. Google AdSense Guest Advertisement



    to hide all adverts.
  3. joepistole Deacon Blues Valued Senior Member

    Messages:
    22,910
    You pretty much have it, these so called Austrians have no need for empirical evidence. It is all about ideology/religion for the Austrians. Why should Austrians need evidence when they can just make stuff up?
     
  4. Google AdSense Guest Advertisement



    to hide all adverts.
  5. w1z4rd Valued Senior Member

    Messages:
    1,541
    I also saw that this shooter in Norway was a proponent of this school.
     
  6. Google AdSense Guest Advertisement



    to hide all adverts.
  7. w1z4rd Valued Senior Member

    Messages:
    1,541
    I ask our local libertarian market fundamentalists of the "Austrian school of economics" to check out this thread. Haha. Im sorry to bring them here, but I think they will make for interesting observation and discussion.
     
  8. Hard Rain Registered Member

    Messages:
    6
    I'm glad to be here. I'm preparing my reply to the original post.


    Thanks, that's a far more accurate and neutral description of my views than how they're usually described.
     
  9. w1z4rd Valued Senior Member

    Messages:
    1,541
    Welcome to a forum where most of the people are biatches for the scientific method. Wanna see if you can tell them the peeps here how much better your Aristotelian deductive reasoning is better and more accurate than the scientific method.

    Please Register or Log in to view the hidden image!

     
  10. Hard Rain Registered Member

    Messages:
    6
    Please don't begin this discussion by misrepresenting my views before they're even stated.
     
  11. w1z4rd Valued Senior Member

    Messages:
    1,541
    My apologies, Ill wait for you to do that then

    Please Register or Log in to view the hidden image!



    jk! Im such a doos

    Please Register or Log in to view the hidden image!

    Ill be interested to see how this discussion goes.
     
    Last edited: Aug 19, 2011
  12. joepistole Deacon Blues Valued Senior Member

    Messages:
    22,910
    Aristotelian deductive reasoning? That would be a big step up for the Austrians.
     
  13. Hard Rain Registered Member

    Messages:
    6
    Thanks for inviting me to discuss here, w1z4rd, although as I point out on the other forum I’d appreciate it if you refrained from smear tactics.

    Firstly, it’s important not to conflate the Austrian School of Economics with a particular political ideology. Yes, many of the proponents of Austrian economics have also been political theorists, but we need to distinguish between these two branches of study in our discussions. For example, prominent Austrian economists such as Ludwig von Mises and F.A. Hayek would not have considered themselves to be “right wing” or “market fundamentalists” or even “libertarians”. Their political ideas are fundamentally of a classical liberal nature and can be contrasted with other economists of the Austrian tradition who are more ‘extreme’, if you like, such as Murray Rothbard, Walter Block etc.

    It seems like w1z4rd would like this discussion to be primarily about the Austrian School and its methodology compared with other economic schools, so I won’t dwell on political matters beyond responding to his original post:

    The definition of “libertarian” is: “a person who advocates liberty, especially with regard to thought or conduct.”

    Thus anarchism is not analogous to libertarianism. There is a broad spectrum of political theory within what is collectively termed “libertarianism”, ranging from the classical liberal tradition of trying to limit the extent government can expand and infringe upon the rights of its citizens all the way across to anarchism where proponents believe the state is undesirable and unnecessary altogether.

    My point: It is incorrect to assume that proposing statelessness and opposing governmental regulation is a full expression of libertarianism. Classical liberals, minarchists and others do not share the same aversion to the state or its regulations as anarchists do. There are merely degrees of concession and agreement.

    I consider myself to be an anarchist, but not of the variety who wish for there to be lawlessness, chaos or who demure all forms of property and authority.

    Secondly, what do we mean when we speak of “regulation”? If we mean: “a law, rule, or other order prescribed by authority, especially to regulate conduct” then I am certainly not against this. What I am against is the proposition that these laws and rules must have their inception and enforcement monopolized by the state. I believe that when the state socializes regulation it is inefficient, crowds-out private alternatives and opens the door to: cronyism, moral hazard, rent-seeking, and the “revolving door”.

    My point: The choice between socialized regulations and total lawlessness is a false dichotomy. The profit-loss mechanism, competition and the market process create the incentives and the environment whereby a centralized power arbitrarily maintaining regulations is not only unnecessary, but undesirable.

    .

    To ponder the question of “essential service” provision we need to consider what exactly an “essential service” is and why we think it best for it to be provided by a government. In doing so we discover the inherently subjective nature of what goods and services we may describe as “essential”. Historically, the basis for a state has been fundamentally founded upon those in power claiming to act in the defence of those they govern. Thus we see that the first and primary “essential” service the state claimed it needed to monopolize and provide is common defence. From this basis springs all other “essential” services to the point where, today, most would consider such things as food, water, education, electricity etc. “essential” services, yet what we deduce is that none of these goods and services were ever actually created by, or necessitated by, state provision in the first place.

    My point: the provision of all goods and services has been fundamentally private in nature. The fact that through the course of history the state has monopolized some and people have come to believe only the government is capable (or obligated) to provide them is notwithstanding.

    I will respond to the statement about Austrian Economics in a new post.
     
  14. w1z4rd Valued Senior Member

    Messages:
    1,541
    Im waiting with bated breath

    Please Register or Log in to view the hidden image!

     
  15. Hard Rain Registered Member

    Messages:
    6
    Day's ending now and I'll be out for the evening, but if I have the energy I'll get a post up later tonight or on Saturday.
     
  16. w1z4rd Valued Senior Member

    Messages:
    1,541
    No worries, dont respond to me, you got an idea of how I am going to respond, engage others responders here.

    You know by default Ill reject anything that isnt able to comply with the scientific method (empirical testable evidence), perhaps others will be more accommodating.
     
  17. quadraphonics Bloodthirsty Barbarian Valued Senior Member

    Messages:
    9,391
    It tends to fall somewhere between "wooh" and "irrelevant to reality." I.e., even if done carefully and properly, it can only really describe a very limited set of circumstances, and even then only make very weak assertions about them. More often, it's an exercise in ideology - a collection of unfalsifiably assertions, based on unverifiable axioms - and so really more of a political or ideological prop, than an actual contribution to social sciences.
     
  18. w1z4rd Valued Senior Member

    Messages:
    1,541
    I wont lie, I get some of the strangest responses that my mind cant seem to grasp. In another forum Hard Rain responds to me:

    My response:

    http://mybroadband.co.za/vb/showthread.php/358048-Ron-Paul-remains-media-poison/page8

    As you can see I still have no clue at what he means, so I was hoping someone could help us understand each other

    Please Register or Log in to view the hidden image!

     
  19. quadraphonics Bloodthirsty Barbarian Valued Senior Member

    Messages:
    9,391
    It basically means: "controlled experiments (and extrapolation of their outcomes) is a much thornier issue in the social sciences than in, say, physics. Therefor, I'm just going to save myself the trouble and not worry about doing science at all. Instead, I'll just pass of philosophical musings as economics - which will be easy, because I don't have to extrapolate from fact, nor subject anything to falsification - and throw a lot of obtuse verbiage at anyone who notices, in the hopes of intimidating them into leaving me alone."

    Which isn't to say that the difficulties with empricism in social sciences aren't real - but they don't seem to stop anyone else. You'll notice that Austrian economics takes plenty of heat from serious economists of all political stripes - Milton Friedman disdains them as much as Paul Krugman does.

    Austrian economics is to actual economics what Freudian psychoanalysis is to actual psychology.

    Which isn't to say that Austrian school economists haven't figured out some useful stuff (likewise, Freudians), but when they do it is in spite of their approach and not because of it.

    One upside of all their wooh-wooh approach is that it tends to make them very poor advocates (except when preaching to the choir). They end up going on obtuse rants full of bizarre terms-of-art and so on, and so end up coming off as cranks to general audiences.
     
  20. w1z4rd Valued Senior Member

    Messages:
    1,541
    Dunno about that, their numbers seem to be growing. Over the last year I have seen a three fold increase in the amount of proponents of this type of wooh on our local forum. Unfortunately the average person on the South African forum has about as much science education as you have space walk experience. Meaning close to 0. So they are not readily equipped to tell the difference between wooh and reality.

    A place I find that the austrian school of economics is very harmful to society is that all the austrian supporters on our forum deny climate change, and make it out its some kinda socialist conspiracy to get more taxes. This is harmful to climate change education.

    I kinda feel this origination is astroturfed by rich people who are trying to create a group of people to lobby against taxes that might effect the rich. Though this is just my personal speculation.
     
  21. WilDCaT Registered Member

    Messages:
    11
    First of all, you need to stop trying to ad-hominem your way to a debating victory. You need to first understand your opponents view, and then critique, using your own words or understanding (By all means reference someone else, but if that critique is addressed or already responded too by the Austrians, then you need to respond to the Austrians and reject their response by saying it is inadequate and explaining why).

    If you cannot respond to the questions, criticisms and points made of your opponent in a debate, then by any rational method of determining a debate winner, you lose.

    This video by Hans-Herman Hoppe (Can't post links as my post count must be 20, so youtube "Praxeology: The Austrian Method (by Hans-Hermann Hoppe) - Introduction to Austrian Economics,") is probably the best illustration of why Austrians take the position they do. Furthermore, it specifically refutes the empiricist/positivist approach as propounded by people like Popper. It is a long video, and Hoppe isn't English so get a cup of coffee and have patience.

    Once you have watched the video, you should be able to come here and critique the view. Calling it Pseudo-science is not a critique. It is not empirical, it is logical or deductive reasoning.

    Ever heard of logical absolutes or logic or deduction. I would also point out that Mises does not completely reject empirical methodology, as his brother is a famous physicist, he understand the importance of the method.

    His magnum opus devouts about 800 pages to the problem of epistomology of economic as a social science. (Humans unlike rocks can change their minds and thus the universal consistancies gound in physical science don't apply. Or rather, the only consistancy is that man has his own opinions and acts on them)

    But the main critique by the Austrians of the empiricist approach, is that there are certain things that need to be done according to that approach to verify a theory.

    E.G. You need to be able to perform experimentation (Observations), these need to be reproducable and a theory should be falsifiable.

    If you cannot reproduce an experiment, according to the scientific method, the theory or idea cannot be confirmed. Cold Fusion is the best example.

    However, the empiricists in economics do NOT APPLY THIS. (Hoppe explains why in the video), I.E. according to the empiricists, none of their theories are be falsified by evidence, despite evidence that contradicts their theory. (There is always an excuse or variable for the contradiction, thus the theory is NEVER rejected or refined)

    A perfect example would be the Keynesian theory that more spending (Contrary to common sense) is what is required to get out a recession.

    The Keynesians said this, the US government should inject hundreds of billions into the economy to boost spending and get out the recession. When this didn't work (I.E. Evidence that contradicts the theory), their theory, unlike in the physical science wasn't rejected or refined.

    They merely responded, the theory is 100% correct, however the level of spending wasn't enough. This resulted in more money, QE2 being injected into the system. Now there are some people anticipating QE3. Which means QE2 spending didn't work (Again contradicting their theory).

    However, we just need more spending. Accordingly, we could get QE100, and they will still be able to use the excuse that their theory is correct, however the level of spending by the state was not adequate. This is a big problem in economics because of the amount of variables at play in an economy.

    No matter what theory is given, no matter how absurd that theory is, according to the empirical approach, all theories are regarded as having the same merit, and all theories should be verified by experiments and thus all theories are given the same weight as all other theories (As Hoppe explains in the video).

    I want to give a little history of economic thought here: (Cant post links as post count not 20 so please look at the Austrian School Wiki for History)

    Oh yes, BTW, like Einstein, Mises and his brother were educated in "Gymnasium" schools, which were schools for the intellectual elite in Vienna I believe. "At the age of twelve Ludwig spoke fluent Yiddish, German, Polish, and French, read Latin, and could understand Ukrainian."

    He was highly educated, agnostic with a brother as a famous world class physicist. He is not a practioner of "pseudo-science".

    Hulsman's biography of Mises can give insight into his early years, and influences which Wizard has repeatedly tried to misrepresent on the other forum.

    Apparently, Mises being an agnostic classical liberal, holding the rights of ALL individuals to the highest standard, and one of Nazi Germany's greatest intellectual foes, is apparently for Wizard, "a right-wing Muslim hating "Nazi-esqu" Christian radicalist" , in the vein of the Norwegian Shooter.

    No he isn't.

    Deal with the arguments please. Or run to another forum like you have done here.
     
  22. Me-Ki-Gal Banned Banned

    Messages:
    4,634
    Life is so so strange . I meet a girl named Mary last night at band . She is Jerry's new girl friend . She is of Austrian heritage ,. Your Time is impeccable Austrian thinkers . So strange so so strange , There was something else that made strange that is slipping Me mind . It was to strange simultaneously for my mind to rap around . The Mary stuck out as Me life is being surrounded by these Mary Characters. O.K. I will check it out , but I am a slow thinker so bare with me if I get left in the dust . I have tendency to catch up while you all sleep . or laze around the T.V. .

    My 2 cents right now as a free enterprise person ( I am free) The public determines the good product from the bad by the things they buy . Government only knows lowest cost of delivery , but the public knows best quality for the the best price . That is what drives the market . Government sub standards don't even come into the picture of free markets . Now the world has been made disposable by planed obsolescent. This is to keep the consumer addicted to the product once they are in the position to develop wants for the product . Markets are collapsing world wide cause things not as important for survival are being tossed to the side , our thrown to the ground as Paul Kruggman would say . This is cause deflation of those particular items. People are looking for value and disposable products are going to start disappearing as the the consumer shifts its choices . You can already hear the marketers in the know changing there rhetoric to compensate for this change in consumer attitudes.

    Wake up silly people . Wakey Bakey Life is now , When your dead your gone from the Living
     
  23. Me-Ki-Gal Banned Banned

    Messages:
    4,634
    Dw,
    Check this out . I know you are my main hope of understanding cause you read so fast. Truly unique individuals are hard to find and dear you fit the bill .
    O.K. let Me hpoe I get the post right
    http://en.wikipedia.org/wiki/George_Mason_University

    look at the emblem too just for shits and giggles . Freedom and Learning ? I like that . There Evangelism symbolized is irresistible . Sound like Mason stuff too . G.M.s oh to funny . The Temple is laughing big time

    Bailey's crossroads no less . I got a book written by one of the Baileys . Tittled "The Stulls of Millborough"

    No brag just fact . I am in the book. Me son is too. I'm Alive
     
    Last edited: Aug 20, 2011

Share This Page