Worth Reading #2: What's Wrong with Austrian Economics (March 17, 2010)
John Quiggin:
John Quiggin: What’s wrong with Austrian Economics: In my email today I got an invitation to a conference on Austrian Economics in the 21st century, to be held in Argentina. Details here for those interested. What struck me was the list of topics, namely - Economics - Epistemology - Methodology - Political Philosophy - Readings on the Austrian School of Economics. That is, 80 per cent of the conference is to be devoted to meta-economic issues of one kind or another, and only 20 per cent to the entire field of economics (much of which will probably also be taken up with meta-discussion). A focus on meta-issues is a characteristic problem for heterodox schools of all kinds, but Austrian economics takes it to an absurd extreme. At some point, surely, they need to stop worrying about methodology and history of thought and start actually doing some economics. Leaving aside the obvious silliness of worrying about epistemology in the context of a massive financial crisis, there’s the irony of holding the conference in Argentina, something of a poster child for failed free-market policies (admittedly, before that it was a poster child for failed protectionist policies). Surely the conference could manage a theme on what went wrong in Argentina and how Austrians would do things better next time.
