Sumner Trolls Krugman
A great post from Scott, when he goes after my favorite Keynesian. Here’s the zinger from Scott:
[Scott quoting Krugman:] The one sense in which Ireland has made some progress is that it has somewhat reassured bond investors that its population will continue to sullenly acquiesce in austerity; as a result, Irish 10-year rates, while still at a large premium, are now 60-80 basis points below those of Italy and Spain.
But the repeated invocation of Ireland as a role model has gotten to be a sick joke.
[Scott:] I’m not sure the Irish feel “sullen” about the 9.2% RGDP growth announced last week:
Scott of course can easily handle the Irish success story in his own worldview. Ever since Ireland left the outrageously restrictive euro in 2013, and went to its own central bank that bought and sold futures contracts to ensure expected 5% NGDP growth, the Irish economy has been doing awesome–thereby demonstrating once again that it is a problem of Aggregate Demand that has been holding back the Western nations since 2008.
UPDATE: To avoid confusing my non-cosmopolitan readers, let me clarify that I am kidding. Ireland is still on the euro, and subject to the “eurozone disaster” as diagnosed by Sumner. So my point is, whatever rhetorical device Scott uses to explain why Ireland is capable of 9.2% RDGP growth even though the ECB is doing the opposite of what Scott recommends, is presumably what Krugman would say too. And then, whatever smirk Scott (and I) would use to see Krugman trying to hammina hammina hammina explain his way out of the hole he’d dug for himself, would likewise be applied to Scott’s explanation.
Didn’t they also cut taxes by 25% as well ? That must explain some of the growth.
Well to be fair, Sumnerian critics of the Euro consider it a disaster for not being an “optimum currency area” part of which means the Euro monetary policy is okay for some countries, and very bad for others.
Andrew_FL okay but spell it out. The claims I’ve seen are, e.g., that Spanish wages needed to fall relative to German wages. So are you saying that Irish workers were luckily priced at the right level all along, and Spanish and Greek workers couldn’t compete with them?
Bob, “too be fair” is supposed to be an indication that I think Market Monetarists have a retort to your point, not that I agree with it.
But yes, I would assume that’s what they would say.
NGDP grew at over 11% so I suspect that Sumner might say that just by chance monetary condition were just right for fast (perhaps too fast?) RGDP growth.
Yes, I would agree with that. There’s probably a lot more to it, this is why macroeconomics annoys me a bit… you just cannot summarize a nation down into a handful of numbers.
Ireland was a occupied nation for centuries under the British Empire, this had a bunch of effects, one of which was the Irish took on aspects of the British legal system and parliamentary system, but they never culturally assimilated. There’s still to this day about a dozen specific dialects in what is a fairly small country, which you must admit is pretty weird in the 21st Century.
So Ireland becomes independent for the first time in 1922, then followed with a new constitution in 1937, they were economically in the position of being a rural backwater, having received very little capital investment while under British rule, and pulling out of years of guerilla warfare (what is now known as the Irish War of Independence) that discouraged investment due to the high uncertainty.
They muddled around with various economic policies but only after joining the European Union in 1973 did they find a path for investment and growth. This included bringing in a lot of high-tech companies from overseas, and offering tax advantages, low tariffs and other pro-business policies. They also accumulated a lot of debt, mostly in the banking industry. To be fair, the did achieve excellent growth and modernization.
When the financial SHTF in 2009 the Irish government (for better or worse) decided to bail out the banks at the expense of the taxpayer. Krugman calls this “austerity” based on his continuously rubbery definition of whatever he wants to blame on “austerity” this week. Bailing out the banks hurt, but they pulled through it. Basically, they made a decision, it might not have been the optimum decision, but it worked for them.
Spain on the other hand is a totally different situation. They are what remains of an old empire, with a long history of self rule. Spain didn’t join the EU until 1986, and they have a long history of strong Catholicism, and a long history of either monarchy or strong rulers (like Franco) who functioned like a monarch. They experimented with socialism, constantly struggled with high unemployment. Even during the boom years of the early 2000’s they invested in stupid stuff like solar power. Spain basically has never got it’s act together… and it still hasn’t. They are still dabbling around with socialism, uninterested in entrepreneurship, and running big government deficits year after year.
Supposedly there was “austerity” in Spain, because the massive deficit running at 10% of their GDP in 2012 has been severely cut back down to only 5% of their GDP.
The sort of “austerity” where during 2012, which was the largest government deficit, they had a local mayor organizing supermarket robberies to raid the food stores as a “charitable” act of redistribution.
Behold the power of positivism!
No matter what happens, you can always be permitted to either put weight on a falsification/confirmation and speak to the unimportance of ommitted variables, if it suits your agenda, or you can put little weight on the falsification/confirmation and speak to the importance of ommitted variables, if that suits your agenda.
Your agends never has to be apodictically wrong because it is shielded by the veneer of “doing science”.
Except good empiricism takes account of cognitive biases.
Under your unhinged epistemology no predictions of any kind can be made:
“There are no predictions in Austrian economics. None. Zero. Nada. …. Austrian theory makes no predictions of what humans will learn and do in the future. In fact, it is precisely Austrianism that argues it is impossible.”
http://consultingbyrpm.com/blog/2014/03/potpourri-188.html#comment-301632
“All predictions of what humans will do in the future are ass pulls”
http://consultingbyrpm.com/blog/2014/03/potpourri-188.html#comment-301508
——
That means you have no justification for thinking any Austrian theory will be empirically true at any time in the future, even 5 seconds from now.
>Except good empiricism takes account of cognitive biases
Cognitive biases…studied using the method of empiricism.
So good empiricism takes into account…itself.
In other words, when the political hack wants to dispute an empirical test, he can refer to ommitted cognitive bias variables, and when he wants to promote the test as it suits his agenda, he puts less, or no, weight on them.
LK, you yourself have NEVER posted any comment on this blog that (being sourced by an empirical study) “took into account cognitive biases”.
You say good empiricism does that, but then that would imply you’re a bad empiricist.
Empiricism that “takes into account” cognitive biases still cannot prevent cognitive biases from manipulating the empiricist claims that take into account anything. The cognitive biases are able to run unimpeded because of the very structure of empiricism. Any study does not say “this is final proof”. I always allows for a person to say ” well we just did not see the expected outcome because of [this].”. This is even with empirical studies that take into account one or more cognitive biases.
It is not the case that any empiricist theory that “takes into account cognitive biases” can protect a test of that same theory from cognitive biases. Whatever the conclusion, the empiricist method itself allows for any conclusion to be pragmatically accepted when it suits a person’s biases and to be questioned when it suit’s a person’s agenda.
And what you are calling “good” empiricism is only being practised by a fringe of the mainstream: the behavioral economists.
The rest is then by your own definition “bad”.
It is the structure of empiricism itself that is the problem, LK. There is NO empiricist experiment that can be done that can prevent deceitful, politically motivated, even psychopathic behavior from putting all, some, or no weight on any empirical test, and yet the whole time be within the bounds of empiricism itself.
>That means you have no justification for thinking any Austrian theory will be empirically true at any time in the future, even 5 seconds from now.
Austrian statements are referring to the logical categories of action as such, and all their implications. They are not predictions. They are applicable and present in the very ACT of predicting anything, for example.
The structure of human action be studied, but it can only be structured introspectively. It cannot be studied by observing. When you learn something through observation you are subject of those very same categories of action. None of this is predicting you will act tomorrow, nor what actions you will indeed take.
Didn’t Karl Marx argue that the capitalist is necessarily a victim of selfish class bias? Obviously good empirical leftist economics should go after bad empirical laissez faire economics. Your duty is to expose the cognitive biases in empirical studies that conclude the less government intervention in production and exchange the better. Go thee LK and “PARTICIPATE!” Lol
“The structure of human action be studied, but it can only be structured introspectively. It cannot be studied by observing.”
I see. So Mises was wrong:
“The disutility of labor is not of a categorial and aprioristic character. We can without contradiction think of a world in which labor does not cause uneasiness, and we can depict the state of affairs prevailing in such a world …. Experience teaches that there is disutility of labor.” (Mises 1949: 65).
You continue to destroy Austrian economics everytime you open your big fat mouth. lol
LK, whether or not any particular person made a argument that has been made in the past, which upon study is deemed as either an a priori category of action, or an a posteriori synthetic one, does not “destroy” praxeology.
The disutility of labor, whether it is to be categorized as a priori or a posteriori (Mises argues it is a posteriori) does not at even address the validity of the argument that there is a distinction and that there are arguments which fall under one or the other category.
OK, so Mises argues the disutility of labor is a posteriori. What relevance is this to action as such? Leisure and labor are both actions. All Mises is saying is that labor is not the only action that people can take. They can choose to work more or work less, to experience less leisure or more leisure. We cannot predict the content of actions.
You are highly confused. You do realize that labor is not action itself right? That it is but one type of action? Praxeology deals with action as such. That includes the categories common to both labor and leisure. Both incur costs. Both are intended to seek gains and avoided losses. Both utilize scarce means.
You’re not making any sense.
“The structure of human action be studied, but it can only be structured introspectively. It cannot be studied by observing.” “
You claim the “structure of human action … cannot be studied by observing” — which if you are referring to human action in the real world is an insanely false assertion.
Can human action in the real word be studied by empirical evidence? Yes or no?
If we want to discover how many humans chose to name their child “Fred” in the US in any given year can you know the answer a priori or do you need empirical evidence? Yes or no?
>You claim the “structure of human action … cannot be studied by observing” — which if you are referring to human action in the real world is an insanely false assertion.
No it isn’t.
You cannot understand the logic of action by observing physical bodies moving this way and that, in this place or that.
You must engage in understanding, through self-reflection on yourself as an actor.
>Can human action in the real word be studied by empirical evidence? Yes or no?
The logical categories of ALL actions as such, which is what praxeology deals with, is a priori to experience. You can make a zillion observations. Praxeology deals with the logic of the ACT of observing.
The logical structure of ANY and ALL observations qua actions is obviously not contingent upon particular observations.
>If we want to discover how many humans chose to name their child “Fred” in the US in any given year can you know the answer a priori or do you need empirical evidence? Yes or no?
Praxeology deals with the LOGICAL categories of action as such. For humans naming their children “Fred” versus all other names, where praxeology is used is not to predict how many times Fred is the name versus all other names. It is used to understand what is true for BOTH the naming of Fred and the naming of ~Fred.
Naming children is an action. I don’t even need to make any observations of parents naming their children before I can know that in the act of naming their children, parents must use scarce means to accomplish this task. And, they must forgo opportunities. By naming a child one name, they must forgo all other names. They must incur the costs of doing this.
Now you may think this is not really useful, that it is just basic logic, well that is what praxeology looks like. It looks like doing formal logic.
So now all your claim is that the “logic of action” or “logical categories of ALL actions ” are a priori, even though Mises explicitly admits that NOT all axioms of action are “aprioristic”: “The disutility of labor is not of a categorial and aprioristic character…”
And still you’re so unhinged you will not admit that empirical evidence is used to actually get facts about human behaviour in the real world.
LK,
I do not understand why you continue to fail to distinguish between having your false assumptions corrected, and me “so now” changing my story.
If you realize something you did not know before, it is not necessarily a result of the other person changing what they said. In this case it is your false assumptions being corrected.
It is not “so now I’m saying”. It is what I have been saying.
“…the “logic of action” or “logical categories of ALL actions ” are a priori, even though Mises explicitly admits that NOT all axioms of action are “aprioristic”: “The disutility of labor is not of a categorial and aprioristic character…”.
The disutility of labor is not an axiom of action!! That is what Mises meant when he wrote that the disutility of labor can only be known via experience. It is not a logical category of action, since we can without contradiction imagine both gains and losses being experienced by someone who performs labor, as opposed to leisure or idleness.
You are misunderstanding what Mises wrote.
“…empirical evidence is used to actually get facts about human behaviour in the real world.”
No, it can only get you historical knowledge of what people chose to do in the past.
It cannot tell you the logical categories of action itself. That is only done introspectively.
The “real world” INCLUDES action and all the logico-deductive categories of it, such as means, ends, profit, loss, costs, etc, which are not empirical, not falsifiable by experience, not capable of being disproved by any test, since all of them are in the testing process itself.
The disutility of labor is a HISTORICAL fact, not a logical category of action. It is therefore outside the scope of praxeology. It is not economics, it is history.
You may believe you’re doing economics LK, but you’re really not. You are a historian, and political hack. You are not an economist because you do not engage in economic thinking. You engage in historical thinking that suits your politics. You don’t understand the science of introspection.
In other words, you will not answer the question, because if you did you be totally refuted and shown to be utter fool you are.
And the disutility of labour axiom is NOT “outside the scope of praxeology”: it is one of the fundamental theorems.
LK, you are evading the arguments I made. The burden is on you to justify your claims.
You asked me if Mises was right or wrong about labor disutility being a posteriori. What I think about it is not relevant to whether or not there are a priori statements about all actions as such.
Of course if I had to guess, because I cannot see any logical contradiction in arguing that a person could experience no disutility of labor, or they could experience disutility of labor, that leads me to suspect that Mises was right.
Labor is a particular action. I think it is possible for a person to experience no disutility from working until they are completely exhausted and physically and biologically cannot perform more labor.
Whether disutility of labor is a logical category of action or not, does not engage the argument that such categories exist.
This is what you refuse to engage.
(1) Mises:
“Economics too can make predictions in the sense in which this ability is attributed to the natural sciences. The economist can and does know in advance what effect an increase in the quantity of money will have upon its purchasing power or what consequences price controls must have. Therefore, the inflations of the age of war and revolution, and the controls enacted in connection with them, brought about no results unforeseen by economics.” (Mises 2003: 129).
(2) M_F:
“There are no predictions in Austrian economics. None. Zero. Nada. …. Austrian theory makes no predictions of what humans will learn and do in the future. In fact, it is precisely Austrianism that argues it is impossible.”
“All predictions of what humans will do in the future are ass pulls”
——
You are simply a charlatan who knows virtually nothing of real Austrian economics.
LOL, I use the term prediction differently than Mises did in those passages.
Mises was not predicting a rise in the quantity of money. I would argue Mises was not making a prediction in those passages the way I use thie term.
When I said we cannot predict future actions, I meant that which includes the fact we cannot predict there will even be an increase in the quantity of money.
The argument “If there is an increase in the quantity of money, then ceteris paribus the purchasing power of money is lower” is not an empirical prediction.
lol.. oh, you use it differently from every other human being in history.
In other words, we must enter the Major_Freedom lunatic asylum of idiosyncratic language in order to even debate with you. In your world, war is peace, freedom is slavery and ignorance is strength.
It just means you have difficulty with having your straw men exposed.
The argument that with an increase in the quantity of money there is, ceteris paribus, a decrease in the purchasing power of money, is not even a testable theory LK. It is not a prediction even according to your own positivist definition of it.
The economy is a world of complex, unique events. You’re tilting at windmills.
So when your straw men are exposed, you have trouble dealing with it. Gotcha.
“lol.. oh, you use it differently from every other human being in history.”
Are you telling me that NOBODY understood the following exchange from the movie, Minority Report?:
“John Anderton: Why’d you catch that?
“Danny Witwer: Because it was going to fall.
“John Anderton: You’re certain?
“Danny Witwer: Yeah.
“John Anderton: But it didn’t fall. You caught it. The fact that you prevented it from happening doesnt change the fact that it was *going* to happen.”
Because this is precisely what Austrians mean when they speak of Praxeology’s ability to “predict”.
John Anderton was 100% right, even though the ball didn’t end up falling.
We’re not predicting events – that can’t be done. We can “predict” what will logically follow from certain economic interventions.
M.F, do you use the words “refuted”, “humiliated”, “exposed”, “shown-up”, “crushed”, ” destroyed” and “pwned” differently from others too?
(1) Robert Murphy and Gabriel 2008: 47–48:
“Praxeology can make certain predictions about the future, but they are necessarily qualitative. For example, it can tell us that (other things equal) a fall in the demand for apples will lead to a lower price of apples.”
(2) (2) M_F:
“There are no predictions in Austrian economics. None. Zero. Nada. …. Austrian theory makes no predictions of what humans will learn and do in the future. In fact, it is precisely Austrianism that argues it is impossible.”
“All predictions of what humans will do in the future are ass pulls”
———–
I predict M_F will claim he’s using “prediction” in a different sense from Murphy!
You say:
There are no predictions in Austrian economics. None. Zero. Nada
That rules out any predictions in ANY SENSE.
Yet Austrian economists say that their theory can make qualitative predictions about the future:
“Praxeology can make certain predictions about the future, but they are necessarily qualitative.”
(Robert Murphy and Gabriel 2008: 47–48).
You lose yet again.
LK,
You haven’t shown me to have “lost” anything a first time, so saying “again” makes no sense.
What I argued is not refuted by playing he said she said.
That is obviously how you operate, because you’re a historian only.
The argument that praxeology makes no predictions is not refuted or even engaged by pointing to anyone saying something differently. You can only prove it does by explaining HOW it does, not merely just claiming someone said it does.
You have to do better than this, LK. Your claims are too weak to even be labelled as challenges.
“The argument that praxeology makes no predictions is not refuted or even engaged by pointing to anyone saying something differently. “
lol.. So when Mises and Murphy say that Austrian economics can make predictions through praxeology, you don’t care less what any Austrian economist actually says.
Conclusion: you are clearly a total lunatic utterly severed from actual Austrian economics.
You’re not engaged in Austrian economics, but live in a bizarre world of personal delusion.
LK
“So when Mises and Murphy say that Austrian economics can make predictions through praxeology, you don’t care less what any Austrian economist actually says.”
I already told you I use the term prediction differently than Mises.
You are not engaging the argument. You have nothing.
LK,
Repeating the fallacy of a populum and the fallacy of authority over and over will never make them something other than fallacies.
You cannot refute an argument by doing everything you can to show nobody else agrees. That is not how truth of reality becomes known. It does not become known by vote or popularity.
You have not engaged the argument. It stands quite easily to your ramblings.
It is not an argument from authority to point out that Austrian economists say that predictions can be made using praxeology and that you can cite no Austrian economist who agrees with you that “All predictions of what humans will do in the future are ass pulls”.
We are dealing here with straightforward empirical facts about what Austrian economists think and assert.
If you said that Austrian economics defends the orthodox Marxist labour theory of value, and I pointed out that this is untrue because none of them do and all of them reject it, that would not be an argument from authority. It is plain empirical fact.
So now we see you are reduced to pathetic ramblings now.
Logic can be “used” for making predictions, but that does not mean logic is a prediction science.
When others say “praxeology can be used to make predictions” they mean the logic can be used to constrain possible outcomes that exclude a definite set of impossible outcomes.
LK,
“It is not an argument from authority to point out that Austrian economists say that predictions can be made using praxeology and that you can cite no Austrian economist who agrees with you that “All predictions of what humans will do in the future are ass pulls”.”
Actually it is if you mean to say that what I said is wrong.
That is exactly what it means.
“We are dealing here with straightforward empirical facts about what Austrian economists think and assert.”
No, that is what you are slipping in to this thread as if the wholedebate was about who is right about what so and so said in such and such text.
“If you said that Austrian economics defends the orthodox Marxist labour theory of value, and I pointed out that this is untrue because none of them do and all of them reject it, that would not be an argument from authority. It is plain empirical fact.”
No I would say no theory “defends”. People defend.
If I said praxeology does not consist of the labor theory of value, then you could not refute this by saying “Mr. X says it does, so you’re wrong.”
You have not only not even responded to the arguments I made above about the improper place of empiricism in economics, but you are not even engaging the subsequent arguments either. You are chronically unable to even engage any argument.
Al l you have is he said she said.
LK,
In no post here on this blog have you actually explained how the human action axiom enables people to predict.
No, saying “B-b-but Mr. X said it can!” is not a response. I never claimed “Mises claimed praxeology cannot be used to predict future human actions”. If I said that, THEN your ramblings would at least engage what is being said.
But your ramblings are irrelevant.
The only way you can refute what I said LK, is to show me the steps that you would take to make a prediction by engaging in the self-reflective, logico-deductive method that is praxeology and showing how those steps are a prediction of what people will do in the future.
LK,
You quote Bob Murphy:
“Praxeology can make certain predictions about the future, but they are necessarily qualitative.”
What, to you, does “necessarily qualitative” mean in that sentence, and why does he make this qualification at all?
M_F
I think you’d benefit from reading this paper: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2229570
Thanks Levi.
“Austrian statements are referring to the logical categories of action as such, and all their implications. “
So there are no empirical statements anywhere in Austrian economics? hahaha
How is that funny? That is the characteristic feature of praxeology. Are you actually still clueless about it? Wow.
Praxeology deals with the LOGICAL categories of ALL possible conceivable actions that could potentially be taken. It deals with actions as such. It does not arrogate itself to be able to predict which specific actions will be taken. It tells us what is true about all actions.
As usual you completely missed the point.
And you also totally retreated by the way. You did not stay on topic. You never bothered to defend empiricism applied to actions above. You only quoted Mises arguing something about labor specificslly and pretended this even engaged anything that was said. Hilarious!
“That is the characteristic feature of praxeology.”
What, that praxeology never makes any empirical statements?
“The theorems attained by correct praxeological reasoning are not only perfectly certain and incontestable, like the correct mathematical theorems. They refer, moreover, with the full rigidity of their apodictic certainty and incontestability to the reality of action as it appears in life and history. Praxeology conveys exact and precise knowledge of real things.” (Mises 2008: 38–39).
Mises’s praxeological statements and deductions are supposed to **synthetic* a priori, so they are supposed to be empirical, not analytic.
You know jack about praxeology.
“What, that praxeology never makes any empirical statements?”
Praxeology does not consist of empirical statements.
Making empirical statements is an act. People make empirical statements. Whether people make empirical statements or whether they make non-empirical statements, is outside the scope of praxeology.
Praxeology will deal with what is true for both making empirical statements and making non-empirical statements.
It deals with actions. The part you bolded is just saying action is a real world phenomena. Real world phenomena includes that which is understood a priori.
>Mises’s praxeological statements and deductions are supposed to **synthetic* a priori, so they are supposed to be empirical, not analytic.
Bwahahahahahahahaha
Synthetic a priori statements are not empirical statements.
Not all statements of the real world are empirical as if by definition. Synthetic a priori statements are true statements about the real world, but that doesn’t make them empirical.
Empirical statements are statements that can only be known as true through historical observation.
“Synthetic a priori statements are true statements about the real world, but that doesn’t make them empirical.”
Yes, it does. They are true statements about the real world — that is empirical. You are confusing “empirical” with a posteriori.
Once again you demonstrate your profound ignorance.
No, if a statement is a priori, it is not empirical. This includes synthetic a priori statements.
A priori statements exclude a posteriori statements and are therefore not empirical statements.
Empirical statements are dependent on experience.
Since a priori statements are not dependent on experience, they cannot be empirical.
You are confusing statements that say something true about things, namely people, to be empirical statements if those things can also be observed through experience.
Your understanding of basic epistemology is shoddy.
If a statement is a priori anything, it is not empirical.
Empirical statements depend on experience.
A priori statements do not.
Synthetic a priori statements are not empirical statements because they are not known to be true based on experience.
If the knowledge of any statement does not depend on experience before it can be known as true, which is the case with the synthetic a priori statements in praxeology, it is not empirical.
The reason they are not empirical is the same reason they are not a posteriori.
In other words, a statement is called an empirical statement because of its a posteriori character.
It is preposterous to call any a priori statement an empirical statement.
“If a statement is a priori anything, it is not empirical.
“Empirical statements depend on experience.
“A priori statements do not.”
Truths derived *deductively* from empirical observations also count as a priori, not empirical.
(1) Robert Murphy and Gabriel 2008: 47–48:
“Praxeology can make certain predictions about the future, but they are necessarily qualitative. For example, it can tell us that (other things equal) a fall in the demand for apples will lead to a lower price of apples.”
(2) (2) M_F:
“There are no predictions in Austrian economics. None. Zero. Nada. …. Austrian theory makes no predictions of what humans will learn and do in the future. In fact, it is precisely Austrianism that argues it is impossible.”
“All predictions of what humans will do in the future are ass pulls”
———–
I predict M_F will claim he’s using “prediction” in a different sense from Murphy!
You imply that praxeology makes no predictions or assertions about the real world. Now you say it does. You are totally incoherent.
“It is preposterous to call any a priori statement an empirical statement.”
Philosophers regard **synthetic** statements as being empirical, because they assert things of the real world. You are so stupid you do not understand this.
Synthetic a priori statements assert things about the real world. In that sense they are empirical, but not a posteriori.
Even Kant thought so:
“All empirical propositions are synthetic and vice-versa.”
Immanuel Kant, Notes and Fragments, 3744.1764-66 M 3.
“You imply that praxeology makes no predictions or assertions about the real world. Now you say it does. You are totally incoherent.”
Predict | Definition of Predict by Merriam-Webster
http://www.merriam-webster.com/dictionary/predict
“Full Definition of predict
“transitive verb
“to declare or indicate in advance; especially : foretell on the basis of observation, experience, or scientific reason”
Praxeological “prediction” is not clairvoyance; It is deductive in nature.
It’s the same thing as “predictions” derived from “scientific reason”, which is also not clairvoyance.
“Philosophers regard **synthetic** statements as being empirical, because they assert things of the real world.”
So … just pretend that we said that Praxeology makes empirical statements because we’re claiming it makes assertions about the real world … *and then deal with the assertions on their own merits*.
Because whether or not Praxeology is empirical in nature, it still follows logically from the Action Axiom that there can not logically be, in any conceivable configuration of reality, such a thing as a lack of aggregate demand.
Value *comes from* individuals’ assessment of an item’s utility in satisfying their preferences.
Therefore, consumers set the highest nominal clearing price of all goods (given their respective conditions of scarcity).
Which means that it should be expected that the act of production *necessarily* carries with it the risk of changing consumer demand.
So, even if producers operated on the basis of “animal spirits”, or consumers, all of a sudden, just changed their demands – the economic losses that would occur from that would always be the fault of the producer because:
Production is *for* consumption. You’re not supposed to produce something that consumers won’t want.
There is nothing to regulate, here. Learn economic logic, and you won’t distort price signals, sent from consumers, by attempting to impose centrally planned valuations on subjectively valued resources.
That makes no sense. “Scarcity” isn’t a problem – it just means that there are more desired uses for a resource than there is supply.
And if there’s only a single unit of a resource, but nobody wants it, then it’s not economically scarce, at all.
That’s why you can’t get rid of scarcity – even with central planning. Scarcity is the logical result of humans attempting to alieviate unease.
When they run into a limited supply of a resource, they either use a substitute, or they attempt to alieviate their next highest-ranked preference.
So, the market self-regulates. There’s nothing to solve.
“just pretend that we said that Praxeology makes empirical statements because we’re claiming it makes assertions about the real world”
lol…. it makes statements about the real world but it isn’t empirical in any sense?
“lol…. it makes statements about the real world but it isn’t empirical in any sense?”
Irrelevant for my purpose at hand: The point is to get you to address the assertions on their own merits.
LK,
No you’re wrong about empirical statements. Empirical statements are statements that are in principle falsifiable by experience.
A priori statements, synthetic or analytic, are not empirical because they are not falsifiable by experience.
I use the Popperian meaning of empirical statements. That is why I have been critiquing empiricism in economics for years while you have been defending it for years, and yet you don’t even realize that we have already agreed to what we both mean when we say empiricism and empirical statements.
The action axiom is a apriori synthetic but it is not empirical because it is not in principle falsifiable. You cannot in principle falsify it, because a falsifying attempt would itself be an action, necessarily so.
I use empiricism and positivism interchangeably, and you have understood this for years without questioning the presupposed meaning of these terms.
But this is all neither here nor there. You are not even engaging the topic at hand, which is the criticisms of empiricism as a method in economics. All of my arguments have remain totally and completely unchallenged by you. You are citing other people as if it had any bearing on what I am saying.
LK,
“You imply that praxeology makes no predictions or assertions about the real world.”
I do not merely “imply” it. I explicitly and directly state as much.
Citing others who disagree does not constitute a refutation of this. Praxeology is not a system of particular people’s opinions or ideas. It arises out of them, but the study of action is logico-deductive.
To give a logico-deductive account of history, to explain the business cycle from praxeology, does not constitute a prediction of inflation in the future.
As mentioned, I do not consider ABCT to be a prediction. It is an explanation of what has happened. This does not equate to predicting the future.
Even if there is inflation in the future, we cannot predict what a free market in money WOULD have resulted in. We can at best only guess. It is almost certainly the case that a free market would have resulted in less since 1913, but this is not predictable.
So no, we cannot predict future human actions, period. I don’t care if you cite a million people who disagree. You would not be engaging the argument on its own merits.
LK,
“. it makes statements about the real world but it isn’t empirical in any sense?”
Statements about the “real world” are not by definition empirical. Statements about the real world that are in principle falsifiable are empirical.
Empiricism does not have a monopoly on “the real world” if that is what you hilariously want to convince me (yourself?) of.
Action and all of its a priori categories say things about “the real world” but they are not empirical statements.
Now if you want to define statements that say anything about the real world as empirical, go right ahead. You would only be engaging in semantics.
In other words, by denying that Austrian economics makes any predictions you are a charlatan who only speaks for yourself.
You do not speak for Mises, nor Rothbard nor Murphy.
Whenever you speak about “Austrian economics” we must read: the idiosyncratic economics of Major_Freedom’s personal insane asylum.
Even if all the Austrian economists in the world told you that Austrian economics can make predictions, you’d scream that only you understand Austrian economics, and that everyone else is wrong. You are a delusional fantasist.
LK,
“…you…speak[…]…for yourself.”
We all speak for ourselves.
Everything you say, LK, is from you and nobody else.
If what you meant to say is that an argument is refuted on the basis of its popularity, then that would be the fallacy of ad populum.
I am not speaking for Murphy, or Rothbard, or Mises. Unlike you who monickers himself after a dead economist, which is kinda creepy, I think for myself.
See your problem is that you are unable to debate an argument on its own merits. You view arguments as having to be accepted by others and then you go off on tangents about what those other people have said, then you race back here and pretend that you are actually engaging what has been said.
“You do not speak for Mises, nor Rothbard nor Murphy.”
This may shock you to learn but nobody speaks for them except themselves.
You do even speak for JM Keynes. You speak only for you.
“Whenever you speak about “Austrian economics” we must read: the idiosyncratic economics of Major_Freedom”
You mean a theory should never evolve?
Hahahaha, whatever Mr. “POST” Keynesian wannabe…
Whenever you say anything, am I to take it that you are only ever trying to repeat what others have said?
Then what good are you? I can just go to what those others have said. The internet has made people like you irrelevant. We do not need a person whose sole contribution is to Google what others have said and then post them here with no corresponding analysis or original thinking, only off topic red herrings.
“Even if all the Austrian economists in the world told you that Austrian economics can make predictions, you’d scream that only you understand Austrian economics, and that everyone else is wrong.”
I wouldn’t scream, I would politely argue that every single one of them is wrong.
“You are a delusional fantasist.”
Then so was JM Keynes, because he wrote what at the time nobody else wrote about.
I win, you lose.
“I wouldn’t scream, I would politely argue that every single one of them is wrong.”
Exactly. Only a lunatic would claim that they are defending Austrian theory when what they believe is not accepted by any actual Austrian economists.
QED.
LK,
“Exactly. Only a lunatic would claim that they are defending Austrian theory when what they believe is not accepted by any actual Austrian economists.”
But what I think is accepted by other Austrian economists, (not that it even matters). You are just not well read enough to know otherwise.
The way I view praxeology is for example consistent with Hoppe, again, not that this even matters.
Your arguments are untenable so all you can do is continue to commit the fallacy of ad populum.
It was not a coincidence empiricism was adopted by states the world over, from Communist tyrannical states to mostly free liberal ones. It suits all of their agendas. They just have to minimize or maximize the importance of ommitted variables when it suits their goal of power over others.
LK,
I’m not sure cognitive biases are the primary concern. Can you tell me who said the following?
“In point of fact, no conclusive disproof of a theory can ever be produced; for it is always possible to say that the experimental results are not reliable, or that the discrepancies which are asserted to exist between the experimental results and the theory are only apparent and that they will disappear with the advance of our understanding. If you insist on strict proof in the empirical sciences, you will never benefit from experience and never learn from it how wrong you are.”
I’ll give you a hint, his name rhymes with “hopper.”
Perhaps there are times when epistemology is a distraction and the truth can be arrived at via witty rhetoric:
http://www.redstate.com/repair_man_jack/2014/02/21/barack-obama-karl-popper-john-maynard-keynes-non-falsifiable-recovery/
Also, a rule to live by: the side using ad-hominem is probably wrong.
1. Regardless of what anyone has said or written on the topics, there is an inherent logic to both AnCap and praxeology. If at some point Rothbard made an incorrect analysis of the logic, the underlying logic still holds. If at some point, I allegedly misunderstand a specific economic term or concept, the inherent logic of AnCap and praxeology still holds. Even with our individual explanations refuted, the underlying logic remains true and immutable.
2. “Lord Keynes” does not understand either concept. His M.O. is to attack poorly stated Austrian analysis which does not impact the underlying logic and reality.
3. I am not in the mood to differentiate the philosophical difference between observing that all humans engage in economic calculation vs. the actual process of a particular person engaging in economic calculation (which no one else can ever really know). Nevertheless, the process of economic calculation is ubiquitous and precedes the outcomes of the actions of humans. In a sense, it is SUPER EMPIRICAL, to coin a phrase.
From “In Defense of ‘Extreme Apriorism’” By Murray N. Rothbard:
Whether we consider the Action Axiom “a priori” or “empirical” depends on our ultimate philosophical position. Professor Mises, in the neo- Kantian tradition, considers this axiom a LAW OF THOUGHT and therefore a categorical truth a priori to all experience. My own epistemological position rests on Aristotle and St. Thomas rather than Kant, and hence I would interpret the proposition differently. I would consider the axiom a LAW OF REALITY rather than a law of thought, and hence “empirical” rather than “a priori.” But it should be obvious that this type of “empiricism” is so out of step with modern empiricism that I may just as well continue to call it a priori for present purposes. For (1) it is a law of reality that is not conceivably falsifiable, and yet is empirically meaningful and true; (2) it rests on universal inner experience, and not simply on external experience, that is, its evidence is reflective rather than physical7; and (3) IT IS CLEARLY A PRIORI TO COMPLEX HISTORICAL EVENTS. p. 6 Emphasis added, especially to the phrase “complex historical events”.
4. A detailed analysis of both AnCap and the implications of praxeology require a meticulous examination of the influence of violence upon the actors and the level of physical security for the actors and their property. None of our opponents will ever think through these matters. Their mocking of us demonstrates their fear that we are right. They are so afraid we are right that they dare not engage us in detail on the merits.
5. BTW, when did the market fail historically requiring the Keynesian cure? How did the analysis strip apart the voluntary market aspect of the historical evidence from the violence and Central Bank interventions? I’ve personally been waiting years for these simple answers. More proof that there are no such answers.
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