23 Mar 2016

Ludwig von Mises’ Contributions to Economic Science

Economics, Shameless Self-Promotion 2 Comments

A talk I gave at the International Students for Liberty Conference in DC a couple of months ago.

2 Responses to “Ludwig von Mises’ Contributions to Economic Science”

  1. Reader says:

    This is awesome (and funny). Thanks for sharing it!

  2. Adrian Gabriel says:

    Great lecture Dr Murphy, you are always insightful and entertaining. In regards to mathematics in economics Rothbard wrote some great stuff that was very concise on the topic. Realistically speaking, math is theory. Mathematicians build models to try to explain events in the real world. In finance or economics mathematics makes estimates within a certain confidence interval based upon historical data. All of finance essentially is a really good educated guess. Sure it may be useful to help in making estimates, but essentially the basic principles of an economy are more useful.

    I have a close friend in NYC that received a Masters in Applied Mathematics at NYU (a top 10 school in Mathematics in the world), and stepped into the world of trading. He now works at an investment bank setting up hedging positions. Hence, this guy has years of experience in the financial sector with financial and mathematical models. When discussing these things with him I derived some basic explanations to the use of math in finance and economics:

    1) Math models are all computer generated and the formulaic work is pretty much done for you. All you need to do is insert the appropriate variables to return a model with your decisive estimates.

    2) Math is not useful.

    According to my friend, it all comes down to supply and demand, extensive math and overblown calculations will not make you a better trader, nor will it prevent large losses during a downturn. One must not forget that even the Quant Traders lost lots of money during 2008. Rothbard had it right.

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