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A Rose By Any Other Name

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Tags Austrian Economics OverviewPhilosophy and Methodology

03/05/2007

Daniel B. Klein proposes that economists of the "Smith-Hayek" variety ought to distinguish themselves from the mainstream economists who have usurped the title to prop their econometric orthodoxy.

Perhaps ten percent of economists in the United States share the broad character represented by Smith, Say, and Bastiat. Would it make sense for them to distinguish their character in some way? Would it make sense for them to cultivate a suitable identity? In this essay, I explore the heterogeneity of character types in economics, delineate the "Smith-Hayek" character, and explain why it might be beneficial for that character to establish an identity that functions in both the professional and public cultures.

As one commenter noted on Cafe Hayek's blog, the characteristic which best captures the divide between the two--

... is a heavy reliance on deductive reasoning, while the mainstream form of model building and GDP forecasting relies to a much greater extent on inductive reasoning. Would the brand "Deductive Economics" be out of place?

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