Re:Paul Krugman Goes for a Knockout Against Scrappy Austerians
by overgard on Wednesday June 24, 2015 @02:45AM
(#9770037)
Yeah I think that's mostly true. I find myself agreeing with the austrian's diagnosis of present economics, but the medicine they suggest does not always seem appealing or correct, and I think worshipping hayek is basically as dumb as worshipping keynes. Don't get me wrong, big ideas worth reading about, important people, but I strongly suspect they were both significantly wrong about some big things.
Still though, when I hear commentary by someone like Peter Schiff, I find it very hard to ignore. Perhaps his ideas are "out there", but so were the people that suggested that the sun does not revolve around the earth. I guess that's a long winded way of saying I don't think they're obviously batshit insane wackos, they have ideas that should be heard.
And that's not surprising, because most 'Austrian' economic tenets are a part of micro-economics. Opportunity cost, marginalism, consumer preference, and other concepts that form part of neoclassical economics originally come from the 'Austrian' school. No one disputes that, and these all are taught in economics courses.
The problem with modern 'Austrian' economists is that they generally don't have a coherent macro-economic model, with the more modern 'Austrian' economists (do any real ones exist?) veering into ideology, philosophy and politics. Most reject the advances made into econometrics, mathematic models, and modern neoclassical macro theory.
And that's not to say there's no disagreement in the neoclassical camp. But pretty much everyone who actually attempts to practice economics as a science, generally falls into the neoclassical camp.
Edit - there's a reason Hayek is more frequently cited by right-wingers and libertarians than by economists. Most of his writings were political, and many of his predictions false.