Re:people are not mathematical equations
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As illustrated by Garrison, mathematical economics cannot properly address causaility; nor can we learn causality from it, despite the fallicious thinking of some sophisticated econometricists.
History does not tell us about economic theory. History is merely a series of facts. We interpret history through economic theory. If history explained economics, the enormous gap between Marxist class analysis and Austrian class analysis could not exist.
The Austrian theory of the business cycle (ATBC) is the only theory which adequately explains modern business cycles (in ancient times, the cause for depression was often obvious: a despot took all of the money). Nor is the ATBC inconsistent with history. Sorry, but you haven't in any way shown this. Of course, you are right -- it doesn't explain 3000 years of history. It explains one thing: the business cycle.
Rather, the ATBC is an interpretation of history. No theory of economics can be proven or disproven by history. (Unless it is so crudely stated as to say something like, "inflation always causes the CPI to increase", in which case we can see that during the 20s boom, consumer prices did not rise; rather, the effects of inflation manifested in the stock market). And even according to econometrics, there is nothing that disproves the ABTC.
You have completely failed to show how the ATBC is somehow inconsistent with history. This is just an assertion on your part. I cannot force you to educate yourself.
regarding granger-causality, sophistication cannot convert fallacy to principle. The same could be said of the entire mainstream economics profession.
Re:people are not mathematical equations
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Do you even know the meaning of the words your using? Praxeology is the study of human action. It thus encompasses -- but is not limited -- to economics, which is a specific subdivisioin of praxeology. Your response illustrates a common fallacy among those dealing with economics, the creation of homo economus.
Prof. Mises did not have a "primary essay". He had a primary treatise on praxeology, simply titled Human Action. He also had treatises before Human Action, such as The Theory of Money and Credit. That you dismiss it as merely a common sense approach shows that you are ignorant. It is based on a set of a priori true axioms. On this, see In Defense of Extreme Apriorism. You should know that those who are the foremost among Austrians are not people who are ignorant of mathematics. Mises, Rothbard, and Hayek had very strong backgrounds in mathematics. Rothbard graduated college at 16, had a BA in mathematics at 19, and a masters in economics at 20. pHD at 30. Mises was also well-versed in mathematics (and his brother Richard Mises, was a mathematician, and member of the Vienna Circle). With a strong background and understanding of econometrics, these men rightly rejected it as nonsense. All current professors in Austrian economics (especially Prof. Walter Block, who's debated with Bryan Caplan on the issue) are well versed in econometrics, and reject it as humbug. This is one reason why I'm not proceeding with a degree in economics: econometrics is a waste of time.
"The Pretence of Knowledge" indeed. You pretend to knowledge and attempt to dissuade others from seeking true knowledge, because if they find it then you have been wrong.
More errors on your part. I believe you mean "pretend to have knowledge". It is a matter of fact that I have a degree of correct knowledge on economics and praxeology. I do not say this with arrogance, any more than I'd consider stating with absolute certainty that 2+2=4. Mainstream economists make unrealistic assumptions and use invalid methodologies. One of my favorite nonsenses is "granger-causality", which is nothing more than a sophisticated mathematical version of the post hoc ergo propter hoc principle (unbeknownst to mainstream economists, this is actually a fallacy).
I can point to the axiomatic a priori basis of praxeology. I can also point to the fact that Austrians are the only ones with a satisfactory explanation of the business cycle, an the only ones who have a good long-term track record with depressions.
Your de novo redefinition of the Golden Rule is typical socialist crap. As briefly mentioned above, focusing on money and nothing else leads to all kinds of nonsense. It is typical of mainstream economists to call people "irrational" for not pursuing a money-maximizing strategy. Yet, this is the fallacy of homo economus. The correct way to go about studying economics is to start from the basics of human action, not making unrealistic assumptions, and proceed from there. The proper language is economics is English, not mathematics.
The heart of the issue is that mainstream economists have ignored causaility, and are concerned almost exclusively with correlation. Were they are concerned with causality, they are fallicious (see "granger-causality"). Quoting from Roger Garrison:
While mathematical economists may not deny that the ultimate cause is to be found in the actions of market participants, they proceed untroubled by the fact that mathematics is inherently silent on the issue of cause and effect. This disadvantage of the mathematical method was Mises's concern [1966, p. 350] when he remarked that [i]ts syllogisms are not only sterile; they divert the mind from the study of the real problems and distort the relationships between the various phenomena.
Garrison also addresses the problems of representing causaility mathematically.
Re:people are not mathematical equations
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Amazing. You have yet again missed the point, or failed to understand it.
The ability to make analogies does not make your case. People are not stars, black holes, or quasars. Astromonists and astro-physicists have gotten along. However, they're not studying human beings with the ability to choose. They're not dealing with the emergent properties of highly intelligent life. They're dealing with physical forces.
All you've done is stated a bunch of humbug, and presented it as fact. From the fact that you can pretty accurately predict what happens to me after I fall from a building (assuming I'm unconscious), it does not follow that you can accurately predict future economic phenomena using mathematical modeling.
The modern desktop computer does not have enough power to predict future economic phenomena accurately. Not even a supercomputer does. A quantum computer wouldn't be able to do it. No matter how much power you throw at the problem, you can't accurately predict future events. The reason is simple: human choice. You can't in any way predict my future changes in value-scales (preferences).
Simply because a computer can model transactions doesn't mean such is useful for real life, or has any predictive power. Modelling transactions is not the same thing as modeling human action. When you have a computer program that can respond exactly as I do in any given situation, then maybe you can model economic phenomena accurately (aside from the enormous complexity of adding in 6 billion more complete and unique AI agents).
However, modeling is not the same thing as predicting. Is your model -- with 6 billion AI units -- also going to account for various natural events that change the way people act? Ultimately, you almost need a model of everything.
Another simple logical problem -- which you haven't even bothered to comprehend -- is that you can't know what you are going to know in the future before you know it. If you knew with perfect knowledge what would happen, that would be useless, because you would be unable to change it. But even dismissing "perfect knowledge", if you could somewhat accurately predict future economic events with mathematical models, your "prophecy" would be self-negating. The actions you and others would take to adjust for what you perceive to be the future would alter it.
You have completely and totally failed to comprehend the complexity (and difficulty) of the situation. You've also failed to understand the fundamental differences between social and natural sciences (in praxeology, we know the ultimate foundations; we don't in physics, chemistry, biology, etc). I'd again suggest Mises' essay on Social Science and Natural Science, as well as Hayek's Nobel acceptance speech, The Pretence of Knowledge (which is a lesser critique).
Re:people are not mathematical equations
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Whether or not many people accept something is quite frankly not my concern. A lot of people accepted alchemy, and that the world was flat. So what? Many who were likely very brilliant argued about how many angels could fit on the head of a needle. Hardly means that's useful.
I don't deny that game theory has its uses in studying evolution. Though, as someone who's studied selfish elements in genetics, I'd argue that other methods are much more useful. Game theory, however, has very little actual use in real-life economics. Sorry, but people simply do not act as game theorists think they do. In fact, game theorists spend most of their time criticizing people for "not being rational". But that just shows that they haven't understood human action.
Life is not a game. People can break out of rules. Economic interactions are certainly not a game, either.
The worthlessness of game theory and other mainstream economics in real life can be demonstrated by looking to successful investors who are economists. Oh, wait, there's hardly none. If econometricians really could do what they think they can, they'd be making fortunes investing. They aren't. In fact, an investing group founded with several Nobel Prize winning economists went belly-up.
The utility of understanding Austrian economics can be seen by realizing that (while most Austrians are permi-bears), the few people who did actually expect the various busts that have happened have been Austrian. See Mark Faber and Jim Puplava recently. Mises in the 20s.
Re:people are not mathematical equations
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Scientific rigor is not dismissed. Austrians merely note that there is a difference between social science and natural science, and that the methods of the natural sciences are not appropriate to social sciences.
Your attempt to use the methods of the natural sciences in economics only shows you ignorance of natural sciences. The crap that goes for "work" in mainstream economics could never be published in a journal of natural sciences; that is, any "experiments" in the natural sciences as poor and void of control would be flatly rejected. You cannot do experiments in the social sciences in the same sense that you can in the natural sciences.
What economists hope for is a "natural experiment". The closest thing that there has ever been to this is the split of West and East Germany after the war. Eastern Germany -- heavily socialized -- floundered in poverty. Western Germany -- more or less free-market, under the "economic miracle" of Ernhardt, taking some of the advice of Ruptke -- prospered. Yet, even in this, we cannot draw any conclusions, but must interpret. The socialists can always say there were some differences between the East and West, and that if things had only been different in the East, socialism would have succeeded.
It is not appropriate to compare physical phenomena to economic and social phenomena, because social phenomena are complex events. There can be no experiments in the social sciences. It is flatly incorrect to use calculus for economics, due to the unrealisic assumption of continuity. Furthermore, there are no fixed relations in the social sciences. People can and do change their preferences; the implication of this is that any numerical relations are only historical and transient. Simply because X% of monetary expansion (inflation) resulted in Y% of price increase in consumer goods does not mean that it will do so again in the future.
Econometrics is thus nothing more than childish play. Its only use is in historical study. We certainly cannot learn anything regarding economics from this kind of mathematical play (though we can learn history). Correct economic theory can only be learned through rigorous logical application -- something most mainstream economists are very poor at -- starting from a priori truths (e.g., axiom that man acts, postulate that there's a variety of resources, etc).
The difference between the social sciences and the natural sciences is something you -- and mainstream economists -- have completely failed to grasp. In praxeology, we are in the fortunate positions of knowing the ultimate foundations. We can thus proceed in a chain of logical reasoning. However, because social phenomena are complex, no experiments can be done (and even if they could be done, it would be completely unethical to do them, for reasons that I hope are obvious even to mainstream economists). In natural sciences, we do not know the ultimate foundations. However, we are in the fortunate position of being able to do experiments.
Re:people are not mathematical equations
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Except, mainstream economists mostly don't use those methods. For a perfect example of some of the absurd assumptions (precisive abstraction), see "perfect competition". And even if they did, it still wouldn't redeem them. Economic phenomena are not continuous. Actors can choose. Preferences can and do change, making indifference curves humbug.
Your mathematical description of the effects of inflation may be true, but so what? It aids in nothing. There are no constant mathematical relationships in human action. Your little mathematical description only expresses in mathematical terms what I said in words. It, however, falls far short of the lofty and unrealistic ambitions of mainstream economists, which is to predict how much prices will rise given a certain amount of inflation. The problem is that because circumstances can and do change -- and more problematic for these "measurers" that people can change their preferences, time-preferences, and time-preference schedules -- while increasing the monetary base by X% may have resulted in Y% price-increase in the past, it isn't sure to do so in the future, even if all measureable things are the same.
Re:people are not mathematical equations
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nice job of selectively picking out only the things that help your point. The big difference between human beings and animals is that we are economic creatures, and can choose. We have societies, moralities, laws, cultures, histories, etc. I'm not denying that John Nash was brilliant: I'm just saying that game theory is almost useless for an understanding of human action. As I said, Friedrick von Hayek did win a Nobel Prize -- something you conveniently ignored -- and agrees with his mentor, Ludwig von Mises on the subject (whom the Nobel committee would have had no choice to give a Nobel, had he been alive when Hayek received his).
The school of Austrian economics accurately praxeology without using any of the absurdly unrealistic assumptions that game theory uses. (for a brief overview, see What is Austrian Economics?).
By the way, pre-empting an argument is not refuting it, but is rather agreeing with it.
Re:people are not mathematical equations
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all mathematical models of human behaviour assume continuity. Yet, social phenomena are complex and are not continuous. Human beings do not consider things in infinitesimally small steps, nor are all transactions even continuous (1TV, 2TVs, 3TVs, etc).
Re:people are not mathematical equations
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You can draw a line through any set of points and call it a trend-line. That doesn't mean that the straight line is particularly appropriate.
The real issue here is one over the two kinds of abstraction: precisive and non-precisive. Mainstream economists use precive abstraction, and thus specify the absence of things that actually exist. This is wrong (unless we are doing art or something like such). The meaningful abstraction is non-precisive, which, rather than specifying the absence of something, simply does not specify it. Quoting from Prof. Long's Realism and Abstraction in Economics: Aristotle and Mises versus Friedman:
precisive abstraction is one in which certain actual characteristics are specified as
absent, while a non-precisive abstraction is one in which certain actual characteristics are absent
from specification.
For an example, consider the following abstractions. (1) Precisive. Inflation, an increase in the monetary base, will cause prices to be higher. (2) Non-precisive. Inflation, an increase in the monetary base, will cause prices to be higher, ceteris paribus. The second statement is true, while the first is not. The second statement is saying that inflation will cause prices to be higher than they otherwise would be, or that prices will be higher (if all else is equal). It thus does not ignore the reality that all else will not be equal. The first statement ignores that reality.
It is the difference between a physicist not accounting for friction in his calculations and specifying that friction does not exist.
Re:people are not mathematical equations
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The Nobel prize is awarded by a bunch of socialists, so who cares what they say? They also gave the Nobel Prize to Friedric von Hayek in 1973 (a student of Ludwig von Mises) for his work on the business cycle, which was essentially an extension of Ludwig von Mises' work on the business cycle ("coincidentally", they gave it to him right after Mises died). Hayek would be in complete agreement with the authors I cited, and Mises, on the matter of the poorness of game theory. In fact, you can refer to his Nobel Prize acceptance speech, The Pretense of Knowledge.
Summarily, citing the fact that one person's a Nobel prize winner and someone arguing against him isn't is meaningless, and is a non-argument. You haven't in any way refuted the arguments presented. You were also selective in the author you singled out for ridicule. Ludwig von Mises -- most certainly the greatest economist of the last century -- also made the same point. For background on Mises, he developed the Austrian business cycle theory, which allowed him to predict the Great Depression before anyone else had. He was also one of the only economists arguing against communism as worthless rubbish before the USSR failed.
I'm not interested in the behaviour of parrots, or in any of the other absurd unrealistic assumptions of game-theory and of many modern economists.
people are not mathematical equations
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· Score: 2, Informative
There are many problems with mathematical modeling of human behaviour. Firstly, economic phenomena (and we can broadly characterize all phenomena as such) are not infinitesimal. They are discrete. Thus, various operations of calculus are completely invalid, as the reality of human action is not continuous, but discrete.
Secondly, human beings can choose. The reality of game theory is that it is a bunch of humbug which is often wrong, and when it's right, doesn't do any better than common sense would. In real-life situations, the only people who behave as game-theorists predict are actual game-theoreticians.
That's nothing more than an appeal to power, consequentialism. "If you don't do what these powerful men want you do, they will use coercive force against you." So what? That's neither a legal nor a moral argument. All you've shown is that the political class exercises power. So what? That doesn't say anything about law, justice, or morality.
There are moral facts, just as surely as there are physical and mathematical facts. The arbitrary expressions of those in power can't make something right or wrong anymore than they could make 2+2=5. An argumentatively indisputeable principle of law is that of non-aggression, for one cannot argue against that principle without self-contradiction. Hans-Hermann Hoppe explains this well, referring to the a priori of argumentation, namely that you cannot consistently argue for anything that violates that premises you assume by arguing in the first place. You cannot argue that Mises' action axiom (man acts) is false, because arguing is itself an action. You cannot argue against Rand's consciousness axiom, because by the act of arguing, you demonstrate conscience. And you cannot argue against the non-aggression axiom, because by entering an argument in the first place, you're assuming it.
Legislation is merely an expression of power. You can't legislate morality, justice, or law. Your power can either be in recognition of natural law (and morality) or against it, but it cannot change it.
If someone steps on your property and refuses to leave, you have the right by natural law to use whatever force is necessary to remove them. If someone's threatening you, you have the right to use proportional force in response to the degree of the threat. Someone burglarizing one's home poses a lethal threat, and lethal force is justified in response. See Law, Property Rights, and Air Pollution. Rothbard, Murray.
The "MP3-players" that play the most formats are the most useful to users, because users can download/obtain/burn music in many formats. I think the iRiver H340 is a great MP3 player because it can play MP3, WMA, ASF, and (most importantly) OGG music files.
As Austrian economists have been saying over and over again, simply because on event (e.g., fall in music-industry profits) follows another (e.g., online sharing of music) does not mean that the earlier event caused the later event. This is the post-hoc ad-hoc fallacy. See this analysis from Mises.org.
You don't know what you're talking about. Politicians don't "cause" economic growth and prosperity; the best they can do is to get out of the way. They can cause economic ruin by intervening in the free market, regulating, inflating the monetary supply, taxing, and telling others how to run their lives; but they cannot cause economic prosperity.
Democrats and Republicans are the two sides of the same coin: the Welfare/Warfare State. Both support various socialist interventions into the free market (it's just a matter of whether those interventions are Communist, such as welfare, or Fascit in nature, such as corporate subsidies at the taxpayer's expense).
The fact that these people are distant relatives of Bush is completely irrelevant. They have added nothing to the discussion that hasn't already been said in a more intelligent fashion elsewhere. All I see is a poorly designed website that's like a run-on sentence with no organization.
don't spout ignorance. Standard Oil was a very good company which was actually cutting prices and increasing output before crazy Teddy decided to pursue them.
Your post illustrates the problems of aggregation. "They" were mostly not the people we killed. We murdered far more civilians than terrorists and terrorist-collaborators in the war on Afghanistan. As for Iraq, you should read up on what's going on over there. We've been ruining that nation. We've socialized oil, resulting in enormous waiting lines; one ignorant military commander ordered his soldiers just to fill up everyone who came, so as to "quickly reduce the line"; the result, as anyone with even one ounce of understanding of economics would know, is that the lines became even longer! We disarmed citizens and then used that as an excuse to say we needed to "enforce law and order", when these now defenseless citizens couldn't protect themselves against criminals (because we'd taken away their means to do so).
Regarding what I suggest, and why it would work -- as well as why US-imposed socialism and interventionism in Iraq has failed and must always fail -- see:
Go look at what Republicans actually do, as opposed to what they talk about -- two completely different things (aside from one case, Ron Paul, who's actually a libertarian). The Republican party endorses the socialization of various industries; you don't hear them calling to eliminate medicare, medicaid, social security, anti-"price-gouging" laws, or the rest. And of course, War is the most anti-free-market thing you can do, and Republicans have historically been all about war-monger. The Republican party is true to its roots, though, in Abraham Lincoln, who was a fascist protectionist in the mold of Hamilton and Clay. Under Republicans, the State expands even more than under Democrats.
I was thinking exactly the same thing. Not only did this communist nutcase criticize Bush from the far communist perspective, but he also messed up on the issue of foreign policy and the wars (we shouldn't have been in the wars, and our foreign policy should be one of military isolationism, like G. Washington suggested, and completely unhampered free trade). It is rare that one finds one's self "defending" Bush against attacks of not being enough of a fascist/socialist/big-spender. The normal libertarian position is to criticize Bush for being a lying worthless human being who spews free-market-rhetoric but is all about State-action, regulation, socialization, and interventionism (both at home and abroad).
oh please, these debates are meaningless politic-babble. Bush and Kerry are essentially the same: lots and lots and lots of government telling people how to run their lives. The difference between Bush and Kerry is that Bush think's Bush should run everyone elses' lives, while Kerry thinks Kerry should run everyone elses' lives. Let's look at some of Kerry's idiocies: he's said that Bush was mistaken on the war in Iraq, but that he's going to continue the very same mistaken policy. He's also wrongly supported the war on Afghanistan. What a pathetic cop-out.
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As illustrated by Garrison, mathematical economics cannot properly address causaility; nor can we learn causality from it, despite the fallicious thinking of some sophisticated econometricists.
History does not tell us about economic theory. History is merely a series of facts. We interpret history through economic theory. If history explained economics, the enormous gap between Marxist class analysis and Austrian class analysis could not exist.
The Austrian theory of the business cycle (ATBC) is the only theory which adequately explains modern business cycles (in ancient times, the cause for depression was often obvious: a despot took all of the money). Nor is the ATBC inconsistent with history. Sorry, but you haven't in any way shown this. Of course, you are right -- it doesn't explain 3000 years of history. It explains one thing: the business cycle.
Rather, the ATBC is an interpretation of history. No theory of economics can be proven or disproven by history. (Unless it is so crudely stated as to say something like, "inflation always causes the CPI to increase", in which case we can see that during the 20s boom, consumer prices did not rise; rather, the effects of inflation manifested in the stock market). And even according to econometrics, there is nothing that disproves the ABTC.
You have completely failed to show how the ATBC is somehow inconsistent with history. This is just an assertion on your part. I cannot force you to educate yourself.
regarding granger-causality, sophistication cannot convert fallacy to principle. The same could be said of the entire mainstream economics profession.
Prof. Mises did not have a "primary essay". He had a primary treatise on praxeology, simply titled Human Action. He also had treatises before Human Action, such as The Theory of Money and Credit. That you dismiss it as merely a common sense approach shows that you are ignorant. It is based on a set of a priori true axioms. On this, see In Defense of Extreme Apriorism. You should know that those who are the foremost among Austrians are not people who are ignorant of mathematics. Mises, Rothbard, and Hayek had very strong backgrounds in mathematics. Rothbard graduated college at 16, had a BA in mathematics at 19, and a masters in economics at 20. pHD at 30. Mises was also well-versed in mathematics (and his brother Richard Mises, was a mathematician, and member of the Vienna Circle). With a strong background and understanding of econometrics, these men rightly rejected it as nonsense. All current professors in Austrian economics (especially Prof. Walter Block, who's debated with Bryan Caplan on the issue) are well versed in econometrics, and reject it as humbug. This is one reason why I'm not proceeding with a degree in economics: econometrics is a waste of time.
"The Pretence of Knowledge" indeed. You pretend to knowledge and attempt to dissuade others from seeking true knowledge, because if they find it then you have been wrong.
More errors on your part. I believe you mean "pretend to have knowledge". It is a matter of fact that I have a degree of correct knowledge on economics and praxeology. I do not say this with arrogance, any more than I'd consider stating with absolute certainty that 2+2=4. Mainstream economists make unrealistic assumptions and use invalid methodologies. One of my favorite nonsenses is "granger-causality", which is nothing more than a sophisticated mathematical version of the post hoc ergo propter hoc principle (unbeknownst to mainstream economists, this is actually a fallacy).
I can point to the axiomatic a priori basis of praxeology. I can also point to the fact that Austrians are the only ones with a satisfactory explanation of the business cycle, an the only ones who have a good long-term track record with depressions.
Your de novo redefinition of the Golden Rule is typical socialist crap. As briefly mentioned above, focusing on money and nothing else leads to all kinds of nonsense. It is typical of mainstream economists to call people "irrational" for not pursuing a money-maximizing strategy. Yet, this is the fallacy of homo economus. The correct way to go about studying economics is to start from the basics of human action, not making unrealistic assumptions, and proceed from there. The proper language is economics is English, not mathematics.
The heart of the issue is that mainstream economists have ignored causaility, and are concerned almost exclusively with correlation. Were they are concerned with causality, they are fallicious (see "granger-causality"). Quoting from Roger Garrison: Garrison also addresses the problems of representing causaility mathematically.
Amazing. You have yet again missed the point, or failed to understand it.
The ability to make analogies does not make your case. People are not stars, black holes, or quasars. Astromonists and astro-physicists have gotten along. However, they're not studying human beings with the ability to choose. They're not dealing with the emergent properties of highly intelligent life. They're dealing with physical forces.
All you've done is stated a bunch of humbug, and presented it as fact. From the fact that you can pretty accurately predict what happens to me after I fall from a building (assuming I'm unconscious), it does not follow that you can accurately predict future economic phenomena using mathematical modeling.
The modern desktop computer does not have enough power to predict future economic phenomena accurately. Not even a supercomputer does. A quantum computer wouldn't be able to do it. No matter how much power you throw at the problem, you can't accurately predict future events. The reason is simple: human choice. You can't in any way predict my future changes in value-scales (preferences).
Simply because a computer can model transactions doesn't mean such is useful for real life, or has any predictive power. Modelling transactions is not the same thing as modeling human action. When you have a computer program that can respond exactly as I do in any given situation, then maybe you can model economic phenomena accurately (aside from the enormous complexity of adding in 6 billion more complete and unique AI agents).
However, modeling is not the same thing as predicting. Is your model -- with 6 billion AI units -- also going to account for various natural events that change the way people act? Ultimately, you almost need a model of everything.
Another simple logical problem -- which you haven't even bothered to comprehend -- is that you can't know what you are going to know in the future before you know it. If you knew with perfect knowledge what would happen, that would be useless, because you would be unable to change it. But even dismissing "perfect knowledge", if you could somewhat accurately predict future economic events with mathematical models, your "prophecy" would be self-negating. The actions you and others would take to adjust for what you perceive to be the future would alter it.
You have completely and totally failed to comprehend the complexity (and difficulty) of the situation. You've also failed to understand the fundamental differences between social and natural sciences (in praxeology, we know the ultimate foundations; we don't in physics, chemistry, biology, etc). I'd again suggest Mises' essay on Social Science and Natural Science, as well as Hayek's Nobel acceptance speech, The Pretence of Knowledge (which is a lesser critique).
Whether or not many people accept something is quite frankly not my concern. A lot of people accepted alchemy, and that the world was flat. So what? Many who were likely very brilliant argued about how many angels could fit on the head of a needle. Hardly means that's useful.
I don't deny that game theory has its uses in studying evolution. Though, as someone who's studied selfish elements in genetics, I'd argue that other methods are much more useful. Game theory, however, has very little actual use in real-life economics. Sorry, but people simply do not act as game theorists think they do. In fact, game theorists spend most of their time criticizing people for "not being rational". But that just shows that they haven't understood human action.
Life is not a game. People can break out of rules. Economic interactions are certainly not a game, either.
The worthlessness of game theory and other mainstream economics in real life can be demonstrated by looking to successful investors who are economists. Oh, wait, there's hardly none. If econometricians really could do what they think they can, they'd be making fortunes investing. They aren't. In fact, an investing group founded with several Nobel Prize winning economists went belly-up.
The utility of understanding Austrian economics can be seen by realizing that (while most Austrians are permi-bears), the few people who did actually expect the various busts that have happened have been Austrian. See Mark Faber and Jim Puplava recently. Mises in the 20s.
Scientific rigor is not dismissed. Austrians merely note that there is a difference between social science and natural science, and that the methods of the natural sciences are not appropriate to social sciences.
Your attempt to use the methods of the natural sciences in economics only shows you ignorance of natural sciences. The crap that goes for "work" in mainstream economics could never be published in a journal of natural sciences; that is, any "experiments" in the natural sciences as poor and void of control would be flatly rejected. You cannot do experiments in the social sciences in the same sense that you can in the natural sciences.
What economists hope for is a "natural experiment". The closest thing that there has ever been to this is the split of West and East Germany after the war. Eastern Germany -- heavily socialized -- floundered in poverty. Western Germany -- more or less free-market, under the "economic miracle" of Ernhardt, taking some of the advice of Ruptke -- prospered. Yet, even in this, we cannot draw any conclusions, but must interpret. The socialists can always say there were some differences between the East and West, and that if things had only been different in the East, socialism would have succeeded.
It is not appropriate to compare physical phenomena to economic and social phenomena, because social phenomena are complex events. There can be no experiments in the social sciences. It is flatly incorrect to use calculus for economics, due to the unrealisic assumption of continuity. Furthermore, there are no fixed relations in the social sciences. People can and do change their preferences; the implication of this is that any numerical relations are only historical and transient. Simply because X% of monetary expansion (inflation) resulted in Y% of price increase in consumer goods does not mean that it will do so again in the future.
Econometrics is thus nothing more than childish play. Its only use is in historical study. We certainly cannot learn anything regarding economics from this kind of mathematical play (though we can learn history). Correct economic theory can only be learned through rigorous logical application -- something most mainstream economists are very poor at -- starting from a priori truths (e.g., axiom that man acts, postulate that there's a variety of resources, etc).
The difference between the social sciences and the natural sciences is something you -- and mainstream economists -- have completely failed to grasp. In praxeology, we are in the fortunate positions of knowing the ultimate foundations. We can thus proceed in a chain of logical reasoning. However, because social phenomena are complex, no experiments can be done (and even if they could be done, it would be completely unethical to do them, for reasons that I hope are obvious even to mainstream economists). In natural sciences, we do not know the ultimate foundations. However, we are in the fortunate position of being able to do experiments.
Except, mainstream economists mostly don't use those methods. For a perfect example of some of the absurd assumptions (precisive abstraction), see "perfect competition". And even if they did, it still wouldn't redeem them. Economic phenomena are not continuous. Actors can choose. Preferences can and do change, making indifference curves humbug.
Your mathematical description of the effects of inflation may be true, but so what? It aids in nothing. There are no constant mathematical relationships in human action. Your little mathematical description only expresses in mathematical terms what I said in words. It, however, falls far short of the lofty and unrealistic ambitions of mainstream economists, which is to predict how much prices will rise given a certain amount of inflation. The problem is that because circumstances can and do change -- and more problematic for these "measurers" that people can change their preferences, time-preferences, and time-preference schedules -- while increasing the monetary base by X% may have resulted in Y% price-increase in the past, it isn't sure to do so in the future, even if all measureable things are the same.
To clear up your confusion, I suggest Logical Catallactics Versus Mathematical Catallactics by Ludwig von Mises. A lesser critique of this idiocy can be found in Hayek's The Pretense of Knowledge
nice job of selectively picking out only the things that help your point. The big difference between human beings and animals is that we are economic creatures, and can choose. We have societies, moralities, laws, cultures, histories, etc. I'm not denying that John Nash was brilliant: I'm just saying that game theory is almost useless for an understanding of human action. As I said, Friedrick von Hayek did win a Nobel Prize -- something you conveniently ignored -- and agrees with his mentor, Ludwig von Mises on the subject (whom the Nobel committee would have had no choice to give a Nobel, had he been alive when Hayek received his).
The school of Austrian economics accurately praxeology without using any of the absurdly unrealistic assumptions that game theory uses. (for a brief overview, see What is Austrian Economics? ).
By the way, pre-empting an argument is not refuting it, but is rather agreeing with it.
all mathematical models of human behaviour assume continuity. Yet, social phenomena are complex and are not continuous. Human beings do not consider things in infinitesimally small steps, nor are all transactions even continuous (1TV, 2TVs, 3TVs, etc).
You can draw a line through any set of points and call it a trend-line. That doesn't mean that the straight line is particularly appropriate.
The real issue here is one over the two kinds of abstraction: precisive and non-precisive. Mainstream economists use precive abstraction, and thus specify the absence of things that actually exist. This is wrong (unless we are doing art or something like such). The meaningful abstraction is non-precisive, which, rather than specifying the absence of something, simply does not specify it. Quoting from Prof. Long's Realism and Abstraction in Economics: Aristotle and Mises versus Friedman:
For an example, consider the following abstractions. (1) Precisive. Inflation, an increase in the monetary base, will cause prices to be higher. (2) Non-precisive. Inflation, an increase in the monetary base, will cause prices to be higher, ceteris paribus. The second statement is true, while the first is not. The second statement is saying that inflation will cause prices to be higher than they otherwise would be, or that prices will be higher (if all else is equal). It thus does not ignore the reality that all else will not be equal. The first statement ignores that reality.
It is the difference between a physicist not accounting for friction in his calculations and specifying that friction does not exist.
The Nobel prize is awarded by a bunch of socialists, so who cares what they say? They also gave the Nobel Prize to Friedric von Hayek in 1973 (a student of Ludwig von Mises) for his work on the business cycle, which was essentially an extension of Ludwig von Mises' work on the business cycle ("coincidentally", they gave it to him right after Mises died). Hayek would be in complete agreement with the authors I cited, and Mises, on the matter of the poorness of game theory. In fact, you can refer to his Nobel Prize acceptance speech, The Pretense of Knowledge.
Summarily, citing the fact that one person's a Nobel prize winner and someone arguing against him isn't is meaningless, and is a non-argument. You haven't in any way refuted the arguments presented. You were also selective in the author you singled out for ridicule. Ludwig von Mises -- most certainly the greatest economist of the last century -- also made the same point. For background on Mises, he developed the Austrian business cycle theory, which allowed him to predict the Great Depression before anyone else had. He was also one of the only economists arguing against communism as worthless rubbish before the USSR failed.
I'm not interested in the behaviour of parrots, or in any of the other absurd unrealistic assumptions of game-theory and of many modern economists.
There are many problems with mathematical modeling of human behaviour. Firstly, economic phenomena (and we can broadly characterize all phenomena as such) are not infinitesimal. They are discrete. Thus, various operations of calculus are completely invalid, as the reality of human action is not continuous, but discrete.
Secondly, human beings can choose. The reality of game theory is that it is a bunch of humbug which is often wrong, and when it's right, doesn't do any better than common sense would. In real-life situations, the only people who behave as game-theorists predict are actual game-theoreticians.
I suggest this article on John Nash and Game Theory. I also suggest this article by Prof. Murphy, and this excellent chapter on game theory by Ludwig von Mises.
Because you haven't explained yourself, that doesn't make any sense.
That's nothing more than an appeal to power, consequentialism. "If you don't do what these powerful men want you do, they will use coercive force against you." So what? That's neither a legal nor a moral argument. All you've shown is that the political class exercises power. So what? That doesn't say anything about law, justice, or morality.
There are moral facts, just as surely as there are physical and mathematical facts. The arbitrary expressions of those in power can't make something right or wrong anymore than they could make 2+2=5. An argumentatively indisputeable principle of law is that of non-aggression, for one cannot argue against that principle without self-contradiction. Hans-Hermann Hoppe explains this well, referring to the a priori of argumentation, namely that you cannot consistently argue for anything that violates that premises you assume by arguing in the first place. You cannot argue that Mises' action axiom (man acts) is false, because arguing is itself an action. You cannot argue against Rand's consciousness axiom, because by the act of arguing, you demonstrate conscience. And you cannot argue against the non-aggression axiom, because by entering an argument in the first place, you're assuming it.
Legislation is merely an expression of power. You can't legislate morality, justice, or law. Your power can either be in recognition of natural law (and morality) or against it, but it cannot change it.
If someone steps on your property and refuses to leave, you have the right by natural law to use whatever force is necessary to remove them. If someone's threatening you, you have the right to use proportional force in response to the degree of the threat. Someone burglarizing one's home poses a lethal threat, and lethal force is justified in response. See Law, Property Rights, and Air Pollution. Rothbard, Murray.
The "MP3-players" that play the most formats are the most useful to users, because users can download/obtain/burn music in many formats. I think the iRiver H340 is a great MP3 player because it can play MP3, WMA, ASF, and (most importantly) OGG music files.
As Austrian economists have been saying over and over again, simply because on event (e.g., fall in music-industry profits) follows another (e.g., online sharing of music) does not mean that the earlier event caused the later event. This is the post-hoc ad-hoc fallacy. See this analysis from Mises.org.
You don't know what you're talking about. Politicians don't "cause" economic growth and prosperity; the best they can do is to get out of the way. They can cause economic ruin by intervening in the free market, regulating, inflating the monetary supply, taxing, and telling others how to run their lives; but they cannot cause economic prosperity.
Democrats and Republicans are the two sides of the same coin: the Welfare/Warfare State. Both support various socialist interventions into the free market (it's just a matter of whether those interventions are Communist, such as welfare, or Fascit in nature, such as corporate subsidies at the taxpayer's expense).
are stupid. Both parties are filled with a bunch of worthless liars. The only good one I can think of off the top of my head is Ron Paul ("Dr. No").
The fact that these people are distant relatives of Bush is completely irrelevant. They have added nothing to the discussion that hasn't already been said in a more intelligent fashion elsewhere. All I see is a poorly designed website that's like a run-on sentence with no organization.
PS: Vote Badnarik (Libertarian).
don't spout ignorance. Standard Oil was a very good company which was actually cutting prices and increasing output before crazy Teddy decided to pursue them.
Regarding what I suggest, and why it would work -- as well as why US-imposed socialism and interventionism in Iraq has failed and must always fail -- see:
A Plan for Iraq: Leave. Rockwell, Llewellyn H., Jr.
The Military Option. Blackstock, Robert.
For an overview of our idiotic and misguided foreign policy in the Middle East, see:
A History of Folly. Young, Adam.
Click on the relevant links for a search for more articles using sound economic theory and understanding to analyze Iraq and Afghanistan.
Go look at what Republicans actually do, as opposed to what they talk about -- two completely different things (aside from one case, Ron Paul, who's actually a libertarian). The Republican party endorses the socialization of various industries; you don't hear them calling to eliminate medicare, medicaid, social security, anti-"price-gouging" laws, or the rest. And of course, War is the most anti-free-market thing you can do, and Republicans have historically been all about war-monger. The Republican party is true to its roots, though, in Abraham Lincoln, who was a fascist protectionist in the mold of Hamilton and Clay. Under Republicans, the State expands even more than under Democrats.
I was thinking exactly the same thing. Not only did this communist nutcase criticize Bush from the far communist perspective, but he also messed up on the issue of foreign policy and the wars (we shouldn't have been in the wars, and our foreign policy should be one of military isolationism, like G. Washington suggested, and completely unhampered free trade). It is rare that one finds one's self "defending" Bush against attacks of not being enough of a fascist/socialist/big-spender. The normal libertarian position is to criticize Bush for being a lying worthless human being who spews free-market-rhetoric but is all about State-action, regulation, socialization, and interventionism (both at home and abroad).
oh please, these debates are meaningless politic-babble. Bush and Kerry are essentially the same: lots and lots and lots of government telling people how to run their lives. The difference between Bush and Kerry is that Bush think's Bush should run everyone elses' lives, while Kerry thinks Kerry should run everyone elses' lives. Let's look at some of Kerry's idiocies: he's said that Bush was mistaken on the war in Iraq, but that he's going to continue the very same mistaken policy. He's also wrongly supported the war on Afghanistan. What a pathetic cop-out.