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."
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.
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[ 3.3 ms ] story [ 21.3 ms ] threadEconomic 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."
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.