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Economic School of Thought

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  • View Poll Results: Which school of economics do you think most appropriately explains the economy?
    New Keynesian
    25.58%
    Post Keynesian
    11.63%
    Chicago
    9.30%
    Austrian
    25.58%
    Marxist
    27.91%

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    (Original post by Classical Liberal)
    I think the left can be very dishonest.

    A good example is the great lie of national insurance. Bundling up a regressive taxation scheme with a payment system that favours the rich and selling it as if it were one scheme. Or take the national minimum wage. A law that claims to be for the poor but in practice hurts the poor the most. And the real purpose being protecting unions from competition.

    I am more of a post Keynesian anyway, but the left is definitely full of lies.
    Even if we accept your analysis (I don't agree on the minimum wage)--what makes you think the left aren't just stupid?

    And damn, I thought you were a raving Randian/libertarian nut!
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    (Original post by JacobW)
    Even if we accept your analysis (I don't agree on the minimum wage)--what makes you think the left aren't just stupid?
    I think a lot of people on the left are stupid. I think others are smart and just flat out lie to appease the public or to serve some kind of special interest group.

    And damn, I thought you were a raving Randian/libertarian nut!
    I'm still that lol.

    You will notice if you read my posts I use quite a lot of Austrian theories however this is largely because Austrian theories destroy Marxists, which is the standard enemy I face on this site.

    If you look at my discussion with, say Chef Dave, you will start to see the post Keynesian in me
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    (Original post by JacobW)
    You've misinterpreted my comment. I'm inclined to favour Keynesian economics not because I have some personal love of the policies it justifies, but because the Austrian, Chicago, or Marxian schools seem to rely on philosophical assumptions or beliefs about human nature I don't agree with, or else entail radical reform of a I kind I dislike for reasons that lie outside economics. For instance, I don't think praxeology is much use because you'd need a premise so strong and universal from which to deduce anything significant that the empirical justification required would render deduction redundant; I don't like Marxian economics because it relies on a philosophy that claims a huge amount of knowledge of subjects I don't believe we're able to understand. And I'm a dismal, old-fashioned conservative, so I'm deeply suspicious of anything radical.

    I could be completely wrong of course: like I say, I realy don't know.
    I think you're mistaken slightly about the Austrian methodology. Sure, they do stress it quite a lot, but it's really no different than what conventional economists do (outside of Macro, where the serious differences turn up). The premise is that humans act, and I'll admit this seems rather banal as an assessment, but it has some interesting implications. Why do humans act? To satisfy their own subjective needs. And from there, you can derive a system of principles which are logically consistent: eg the theory of opportunity-costs. And most of these theories are already in use by even the most Keynesian economist.

    I understand your conservatism and I'm sometimes quite conservative (small-C) myself, but when it comes to conceptual accuracy, no matter how radical, the correct thing is the correct thing. The real difference between Austrians and the mainstream is in macro, where the mainstream take a Keynesian, Chicago, New Keynesian or Post Keynesian analysis, which are all wrong so far as Austrians are concerned. I mean, Keynes' analysis of business cycles has many good aspects to it (and I see no reason why it could not be amalgamated into the Hayekian/Austrian theory), but is too narrow in it's focus, and therefore the policy implications that follow from that are wrong.

    The less said about Marxian economist the better tbh!
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    (Original post by Classical Liberal)
    Which school of thought do you think most appropriately explains the economy generally?

    Votes are public.

    I know many of the schools merge and I could have added more.
    Why havn't you included the Georgist school of thought? If you don't understand the real estate market then you don't understand how the economy works, it's really that simple. (btw, you also stand to 'earn' a lot of dosh if you're privvy to the economic secrets that guide the economy, don't let ideology get in the way!)
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    (Original post by D.R.E)
    Austrian! Although I don't think they deviate enough from the mainstream to call themselves a 'school of thought', but hey-ho.
    Austrianism is for wimps. Geo-libertarianism, now there's a man's ideology. Don't expect to get an easy ride from either the left or the right if you support a bit of monopoly taxation, but the truth is never easy (unfortunately). You disappoint me D.R.E, I thought you were on board so to speak. Have you even read Progress and Poverty?
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    (Original post by D.R.E)
    I think you're mistaken slightly about the Austrian methodology. Sure, they do stress it quite a lot, but it's really no different than what conventional economists do (outside of Macro, where the serious differences turn up). The premise is that humans act, and I'll admit this seems rather banal as an assessment, but it has some interesting implications. Why do humans act? To satisfy their own subjective needs. And from there, you can derive a system of principles which are logically consistent: eg the theory of opportunity-costs. And most of these theories are already in use by even the most Keynesian economist.
    I shall have to look into it, but too put it mildly I'm very sceptical about how much you can deduce from "humans act".

    (Original post by D.R.E)
    I understand your conservatism and I'm sometimes quite conservative (small-C) myself, but when it comes to conceptual accuracy, no matter how radical, the correct thing is the correct thing.
    Absolutely! But where there's no decisive proof either way, a dose of Burkean prejudice has got to be a good thing!
    (Original post by D.R.E)

    The real difference between Austrians and the mainstream is in macro, where the mainstream take a Keynesian, Chicago, New Keynesian or Post Keynesian analysis, which are all wrong so far as Austrians are concerned. I mean, Keynes' analysis of business cycles has many good aspects to it (and I see no reason why it could not be amalgamated into the Hayekian/Austrian theory), but is too narrow in it's focus, and therefore the policy implications that follow from that are wrong.

    The less said about Marxian economist the better tbh!
    Again, I'll definately have to look into it sometime. At present, I'm hardly qualified to judge, given that I haven't even completed my economics a-level yet!
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    (Original post by JacobW)
    Again, I'll definately have to look into it sometime. At present, I'm hardly qualified to judge, given that I haven't even completed my economics a-level yet!
    Fair enough, I think it's something to definitely look into at the minimum.

    (Original post by chefdave)
    Austrianism is for wimps. Geo-libertarianism, now there's a man's ideology. Don't expect to get an easy ride from either the left or the right if you support a bit of monopoly taxation, but the truth is never easy (unfortunately). You disappoint me D.R.E, I thought you were on board so to speak. Have you even read Progress and Poverty?
    I haven't read Progress and Poverty yet, but I do support the land value tax, and also consider myself to be a 'geo-libertarian' of sorts. I don't understand why you seem to think there is a conflict between the Austrian methodology of economics and geo-libertarianism.

    It's possible to believe in both.
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    (Original post by chefdave)
    Why havn't you included the Georgist school of thought? If you don't understand the real estate market then you don't understand how the economy works, it's really that simple. (btw, you also stand to 'earn' a lot of dosh if you're privvy to the economic secrets that guide the economy, don't let ideology get in the way!)
    I knew you would point that out.

    To be honest I do not it has a methodology that is unique enough to be considered its own school, even though it is has radical policy proposals. Georgism largely takes up the Austrian approach of just using your head lol.
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    (Original post by Classical Liberal)
    What do you like about the Marxist school of thought?
    Watch this video and find out. The actual lecture begins @ 7:15.


    From early childhood until my early teen years I was a Radical-Leftist. At around age 12 or so, I had considerable Commie/Socialist tendencies. It was at that time that I first discovered this lecture -- A Communist was born *red and gold everywhere*
    During High School (16-18 yrs old) I began to 2nd guess my leftist views for the 1st time. I saw all the hypocrisy and fallacies on the left, and soon my views did a complete 180 and I rejected the left for good... After that I explored Libertarianism, Anarchism, Austrian Econ, Rothbard, and other stuff on the"F**k the state, taxes are theft, collectivism is slavery, f**k your central plans, free market capitalism ftw!!!" area of the political spectrum... and that's where I am today.
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    (Original post by Classical Liberal)
    I knew you would point that out.

    To be honest I do not it has a methodology that is unique enough to be considered its own school, even though it is has radical policy proposals. Georgism largely takes up the Austrian approach of just using your head lol.
    Hehe, you can read me like a book!

    I didn't know us Georgists had a 'methodology', our analysis differs from the Austians, Keynesians and Chicago economists because of our emphasis on the unique importance of land (actually all natural resources) and the rents they generate. Rather than agree with this position all the other schools have done their best to erase terms such as 'land' and 'rent' from the social lexicon, thus covering up the genuine source of the problem with banker bashing and bogus theories on the money supply.

    I just don't see the comparison. Arguably Marx was just as close to Friedman in 'getting it', but they're both way off the mark.
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    (Original post by D.R.E)
    I haven't read Progress and Poverty yet, but I do support the land value tax, and also consider myself to be a 'geo-libertarian' of sorts. I don't understand why you seem to think there is a conflict between the Austrian methodology of economics and geo-libertarianism.

    It's possible to believe in both.
    I'm no Austrian scholar having only really researched Georgism in any depth but my working knowledge has led me to conclude that Austrians and Georgists hold competing thoeries that are both jostling to accurately describe the economic truth. The Austrians -to my displeasure- are winning the public debate but empirically they're no match for Ricardo, Smith, George and their ideological descendants. The Austrians are analysing the secondary indicators of real estate bubbles -the money supply- so while they're in the right area they havn't yet come to terms with what is happening to the economy and why. Their adherence to Austrianism clouds their judgement.
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    (Original post by chefdave)
    I just don't see the comparison. Arguably Marx was just as close to Friedman in 'getting it', but they're both way off the mark.
    How dare you. Take that back.
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    (Original post by Classical Liberal)
    How dare you. Take that back.
    Sorry CL but I can go one better, arguably the Labour Party are closer to understanding the true nature of the economy than Friedman ever was. Tragic I know. For all Friedman's merits (and there were many) he still believed that land distribution was the result of luck rather than recognising it for the state backed cartel it really is. It would be like handing out a finite number of bonds worth £10,000 p/a and then rejecting all economic and moral criticisms of this wealth transfer as void because they're dripping in envy and jealousy. That's not a credible argument to an obvious and avoidable social problem.
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    (Original post by chefdave)
    I'm no Austrian scholar having only really researched Georgism in any depth but my working knowledge has led me to conclude that Austrians and Georgists hold competing thoeries that are both jostling to accurately describe the economic truth. The Austrians -to my displeasure- are winning the public debate but empirically they're no match for Ricardo, Smith, George and their ideological descendants. The Austrians are analysing the secondary indicators of real estate bubbles -the money supply- so while they're in the right area they havn't yet come to terms with what is happening to the economy and why. Their adherence to Austrianism clouds their judgement.
    You're overstating this land thing far too much. I accept that this isn't something that's been particularly high on the list of priorities for Austrian analysis, but it's also a discussion that can be had within the confines of the Austrian methodology. You seem to be talking of LVT as a kind of silver bullet that would solve every economic problem, this is not the case. I like the LVT, and I think there is a serious discussion to be had about it's merits, but this is not the thread for it.

    This thread is essentially about macroeconomic methodology (judging by the poll choices, apart from the Marxist option). Sure, Henry George had some interesting things to say, but we're not debating that here.
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    (Original post by chefdave)
    For all Friedman's merits (and there were many) he still believed that land distribution was the result of luck rather than recognising it for the state backed cartel it really is. It would be like handing out a finite number of bonds worth £10,000 p/a and then rejecting all economic and moral criticisms of this wealth transfer as void because they're dripping in envy and jealousy. That's not a credible argument to an obvious and avoidable social problem.
    Where does he say this?
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    (Original post by D.R.E)
    You're overstating this land thing far too much. I accept that this isn't something that's been particularly high on the list of priorities for Austrian analysis, but it's also a discussion that can be had within the confines of the Austrian methodology. You seem to be talking of LVT as a kind of silver bullet that would solve every economic problem, this is not the case. I like the LVT, and I think there is a serious discussion to be had about it's merits, but this is not the thread for it.

    This thread is essentially about macroeconomic methodology (judging by the poll choices, apart from the Marxist option). Sure, Henry George had some interesting things to say, but we're not debating that here.
    It's not the Silver Bullet eh? Are you sure about that D.R.E?

    As a student of economics I hope CL see's the value in debating one of the greatest economic heists of all time, the privatistion of communally generated land rents for the benefit of the few is the single universal injustice that almost all other economic and social injustices flow from. I'm not trying to be sensationalist when I make that claim: those are just the facts as I see them, and the international housing bubble and resultant credit crunch add some weight to this viewpoint (though of course we all say that so I'm careful with this statement).

    LVT and Georgism won't solve every economic problem, that would be ridiculous, but what it would do is clear away the man-made structural constraints that unfairly redistribute wealth and hold society back ultimately leading to decay as well as a state of social confusion and despair. Our public institutions need to be reformed so that a) everyone can get a fair slice of the pie, and b) they're no longer a deterrent to wealth creation and entrepreneurial activity, only Georgism provides the methodology required to ensure that the economy can operate justly and at full capacity (if it chooses to).
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    (Original post by Classical Liberal)
    Which school of thought do you think most appropriately explains the economy generally?

    Votes are public.

    I know many of the schools merge and I could have added more.
    Why did you vote for Post Keynesian?
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    (Original post by Classical Liberal)
    Where does he say this?
    In one of his books (I can't remember which as I read them a couple of years back) he used an analogy about an island that somebody had 'found', his argument was that the inital finder got first dibs on the island with all the extraordinary and exotic fruits it had to offer while the johnny and sally come latelys had to make do with a less fertile plot and lifetime of unjustified envy and resentment. If you scale that up the finders-keepers model soon comes into conflict with basic human rights, the owners of the land are granted absolute liberty whereas the non-owners are entitled to nothing and can only exist with the explict permission of the aforementioned owners, in other words they have no rights. Friedman was a propontent of Royal Libertarianism.
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    (Original post by TheIronist)
    Why did you vote for Post Keynesian?
    I think they analyse, it is a very broad school, credit markets correctly.

    What I am not is a fan of Keynes.
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    I went for Marxism, although I think Marxist economics is largely inaccurate. Then again I find pretty much all of economics as a body of social scientific thought inaccurate - International Political Economy (IPE) offers much more satisfactory models of economic behaviour IMO (even the ones I disagree with still flesh out their ideas of human behaviour better than most of the economics literature I've written).

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