Renowned local economist explains controversial Austrian theory (Loyola U.)

http://www.nbc33tv.com ^ | October 24, 2013 | David Lippman

[redpoll]

I agree with these ideas ideologically... but as for the unforeseen results... well, it would be interesting. At least there would be more liberty than the current situation.

[rottndog]

Some people also claim that allowing the economy to move unchecked allows for greater volatility and longer recessions.

The current recession/depression clearly disproves that fallacy.

[Red Badger]

"An awful lot of it is predicated on fighting over turf," he claimed, "and if two gangs disagree over something, they shoot it out and kill innocent people. Whereas if two tie manufacturers had a dispute, they'd go to court. They don't shoot it out!"

But no matter who wins, it's still a 'tie'......................

[bamahead]

bfl

[Zeneta]

Must watch/listen if you haven’t done so already.

Economics rap song !!!

Fight of the Century: Keynes vs. Hayek Round Two

http://www.youtube.com/watch?v=GTQnarzmTOc

[KarlInOhio]

The Austrian School of economic thought was devised by a handful of economists in Austria in the 15th century; otherwise, it has nothing to do with the country.

I question that date. That was well before Adam Smith and the Wealth of Nations. Wikipedia (yes, I know the warnings) says:

It originated in late-19th and early-20th century Vienna with the work of Carl Menger, Eugen von Böhm-Bawerk, Friedrich von Wieser, and others. (citing Joseph A. Schumpeter, History of economic analysis, Oxford University Press 1996).

[cdcdawg]

An honest application of this way of thinking will arrive at the conclusion that there are some things that government can do more efficiently than the market. Those things will encompass far less than most people on the Left or Right will believe. The U.S. Constitution (as written) is a pretty good example of limiting government to its efficient ends.

[Uri’el-2012]

Austrian Economics
A Primer
Dr Eamonn Butler 

[Zeneta]

Any honest examination of Keynesian economics would conclude that the rich will get richer relative to the poor that they are trying to help.

It relies on the idea that people are too stupid to make their own decisions.

The Keynesian model is fundamentally “Racist”, as it is being applied here in America.

[WayneS]

A common belief is that conservatives caused the government shutdown, while liberals are the ones who want to legalize marijuana..

Do you walk to school or carry your lunch?

[WayneS]

According to Austrian theory, the market alone should decide the value of products and services.

Okay. It's Capitalism.

[cdcdawg]

I’m not sure what that has to do with what I said, but:

“It relies on the idea that people are too stupid to make their own decisions.”

That belief is probably held by many who espouse Keynesian economics, but I don’t think it relies on that idea. My understanding of it is that it relies on the idea that government can prod economic growth by using its power to stimulate demand via redistribution. That is wrong, perhaps even stupid, but I don’t see how it is racist.

[fortheDeclaration]

The Austrians understand the 'boom-bust' cycle and know that it is the Gov't (Fed) that causes it.

Austrian economics is pure free market!

[freedomfiter2]

There’s a difference between capitalism and free market although the terms are frequently interchanged.

[GeronL]

What part is controversial?

Besides trying to apply it to social issues

[Uri’el-2012]

PO45>According to Austrian theory, the market alone
should decide the value of products and services.

Okay. It's Capitalism.

"Capitalism" is a pejorative term used by
Marxists to describe freedom and liberty.

[ICU812]

You're right that Menger is considered the founder of the Austrian School. I think his reference to the 15th century is a reference to the "Late Scholastics", catholic theologians and acolytes of Thomas Aquinas that tried to reconcile economics with christian dogma during that time period. But they were mostly Spaniards. The name "Austrian" was first applied to the school in a mocking, belittling way by the the Historical School after Menger criticized them in a pamphlet called "The Errors of Historicism in German Economics" which launched the so-called Methodenstreit between the two schools of thought.

[103198]

Austrian ECON Ping

[mjp]

Some people also claim that allowing the economy to move unchecked allows for greater volatility and longer recessions.

Longer recessions and high unemployment during recessions are due to government intervention which establishes an improper relationship between money wage rates and the aggregate demand for labor in the economic system.Specifically, government intervention keeps wage rates and prices too high.If, during a recession, government allowed average money wage rates and prices fall to equilibrium levels dictated by the free market in labor and goods, recessions would end more quickly like it did in 1920, when average wage rates dropped 19% and the recession was extremely short-lived as a result.(This is an example where empirical data confirm the logic of the theory.)