
Down the Rabbit Hole That Is Austrian Economics – Simply Explained - acob
https://achainofblocks.com/2018/09/01/austrian-economics-explained-beginners/
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sharemywin
Is there a simple explanation for Keynesian economics.

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wahern
2/3rds of that article, including everything under "Deep Dive Austrian
Economic School Principles", could equally describe Keynesian economics.

Economic laws are the same no matter your ideology and aren't disputable. But
there's a whole universe of dynamics that are poorly understood. I think what
distinguishes the Austrian school is an ideology that considers state
intervention invariably negative; and separately that we should all use a gold
standard. (I'm not sure how they square the passive, descriptivist perspective
wrt market volatility on the one hand, with the prescriptivist preference for
a gold standard.) But the arguments behind these policy preferences aren't
falsifiable.

The basic argument for Keynsian interventions is reflected in Keynes' famous
line, "In the long run we are all dead."[1] From a policy perspective, it
doesn't matter that a free market will eventually return to equilibrium (or is
by definition in a stable cycle regardless of volatility) if in the short term
people are starving and will never live long enough to see better days. Keynes
was railing against the gold standard and effectively deflationary monetary
policy which _manifestly_ was causing severe deprivations in Britain.

The Austrians counter that volatility is _induced_ by interventionism. No
doubt that _can_ be true and _has_ been true, but it's _also_ true that
intervention _can_ reduce volatility; indeed, all forms of human organization
have sought and ultimately succeeded in reducing extreme volatility. Austrian
vs Keynesian seems more like a debate about normative social policies than
concrete economics.

[1] Longer quote: "The long run is a misleading guide to current affairs. In
the long run we are all dead. Economists set themselves too easy, too useless
a task if in tempestuous seasons they can only tell us that when the storm is
past the ocean is flat again."

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rurban
I have the impression that he conflates the Chicago School of economics with
Austrian Economics. Austrian school was an influence, but more on market
incentives, less state and esp. less taxes. whilst the Chicago school took it
to the extremes explained in the post.

Hayek was a crazy radical ("its all the socialists fault") , much more than
Friedman ("it's all the cartels fault"). But Austrian Economics should not be
conflated with Hayek only, it mostly refers to the pre-modern Laissez Faire
Habsburg states, and not the neoclassical coperatism and neoliberalism.

