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Southern Economic Journal: Simply Atrocious Misreprsentation of Mises

December 7, 2005

Tags Media and CultureAustrian Economics Overview

I just ran accross this article by Murray Rothbard: Ludwig von Mises and Natural Law: A Comment on Professor Gonce. "Professor" Gonce's paper, published in the prestigeous Southern Economic Journal, made several absurd assertions, all of which anyone with even a passing familiarity with Mises would recognize as such. Rothbard thoroughly debunks these claims about Mises. Here are Gonce's claims about Mises:

1. Gonce claims that Mises' economic system is grounded in the "ideaology" of natural law.

2. Gonce claims that Mises 'assumes' perfect competition in product and factor markets, assumes 'perfect knowledge' (at least for Crusoe), and ignores 'the problem of transaction costs.'

3. Gonce makes the astonishing assertion that Mises holds 'money, banks, and credit...contain no seeds of instability,' and further claims that Mises' trade cycle theory 'shows that the free market mechanism will automatically adjust prices to preclude serious trade cycles.'

Rothbard rightly concludes that:

We are forced to conclude that either Professor Gonce has willfully distorted Mises' position to support his own "ideological" dislike of Mises' classical liberal views, or that he is woefully ignorant of the polar difference between natural law and its mortal enemy, utilitarianism...

Gonce is no more capable of comprehending a writer's economic theory than he is his social philosophy. The fact that Gonce's article was published in a distinguished economic journal says much about the parlous state of the discipline.

It is difficult to attribute these mischaracterizations of Mises to anything other than extreme incompetence or extreme malice. Either intentional misrepresentation was carried out, or the author was abysmally incompetent and ignorant. It takes little more than a glance at Mises' work to realize that he was opposed to natural law and was a strong critic of the fantasies of "perfect competition" and "perfect information". Since the Southern Economic Journal published this tripe, they too share in the blame: either extreme incompetence, or purposeful and malicious misrepresentation.

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