Re:A Virtual Weimar: Hyperinflation in a Video Game World
by nhaehnle on Tuesday May 21, 2013 @03:54AM
(#5742390)
Absolutely. It is a matter of quantity, and it would be nice to understand how much and how fast production can increase. But since Austrians usually outright deny the possibility that production increases at all, the path to a fruitful discussion is usually closed.
In practice, even the more ambitious types of policies that are debated do not actually increase spending that much.
Re:A Virtual Weimar: Hyperinflation in a Video Game World
by jacques_chester on Tuesday May 21, 2013 @05:56AM
(#5742716)
Rothbard-school Austrians make the same error as classical Keynsians. They freeze the structure of production, treat it as a homogenous gas, and then modify some exogenous variable.
The Austrians modify money supply; the Keynsians modify the aggregate demand.
It's the same error of over-simplification. Economies are not smooth curves, they are lumpy and have heterogeneous networks of heterogeneous agents.
armchair economist here, but i woudl say that when the increase in money supply outstrip the increase in production (becase there is a limit to the rate of increase of production, but there is no real limit to the rate of increase of printing more money - just put an extra zero at the end, you don't even need more paper/plastic!).