There are numerous critics of the Austrian School of economics, but when their disparagements are closely examined, the so-called experts themselves are wrong. Austrians can do a better job of setting the record straight.
As we wade through the intricacies of modern society, it becomes all the more imperative to go back to the works of Ludwig von Mises.
Critics of Austrian economics often claim that real economic events are too complex to be dealt with via free markets. However, because Austrian economics is based upon understanding human action, it better explains why economic intervention routinely fails.
Central to the paradigm of Austrian Economics is the action axiom. People act, and they act purposefully. That knowledge alone permits us to construct an entire set of theories that explains economic life.
When people speak of “old school economics,” they generally mean the application of economic thinking that involves what we might call “common sense.” That would include permitting a price system to work, protecting private property, and so on. But there is more.
Keynesians are known for using obscure and jumbled jargon to explain their fallacious ideas. The hope being that, the more confusing the language, the greater the perceived scholarship. Good economics can and should be clearly logically explained.
Marx built his infamous labor theory of value on the premise that labor itself was a commodity. However, as Mises and other Austrians have noted, Marx failed both at understanding the complexity of labor and subjective value theories.
Modern egalitarians play down the idea of free will, claiming that free will is relevant only if individuals have no interference with their choices. Murray Rothbard, on the other hand, recognized that self-ownership and one's ability to engage in reason is enough to recognize free will.
The Mises Institute is creating lessons for young economists to better help them evaluate and interpret economic events. Of course, these lessons also apply to anyone else wanting to be better educated on economics.
Keynesians are known for using obscure and jumbled jargon to explain their fallacious ideas. The hope being that, the more confusing the language, the greater the perceived scholarship. Good economics can and should be clearly logically explained.
