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10 sats \ 5 replies \ @Bell_curve 28 Dec 2024 \ on: What Makes Austrian Economics Unique? econ
Economics taught in college today is free markets lead to market failure. Therefore we need regulators to prevent or fix market failure.
Students are taught that regulations prevent or fix market 'failures' but they never discuss the deleterious effects of regulations. Regulators have good intentions ergo we can ignore outcomes.
from John Cochrane:
Econ 101 seems awfully stuck in a rut. A week of market perfection, with eyes rolled. Nine weeks of theoretical “market failures” remediable by the all seeing benevolent regulator. No time on the experience of actual government policies, evaluating how well the parable explains them, or alternative parables of government failures.
https://www.grumpy-economist.com/p/conceptualizing-regulation
The whole reason for this phenomenon is that Keynesianism has taken over most of academic economics. Keynesianism just bolsters the state and statism where interference and regulation is the only thing holding the economy together. Also, for them there is no individual actions, only aggregates. What unadulterated BS!!
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1970s stagflation debunked Keynes and his disciples. One of many instances of Keynes being wrong empirically
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A lot of different instances have shown Keynes to be incorrect in his reasoning. However, his theories are still being taught because the current authors studied Keynes when they were in school, and did their Ph.D.s based upon his theories. Hayek admits he made a big mistake when he did not take up the offer to debate Keynes. He may have changed Keynes' way of thinking. But then again, Keynes was a Fabian.
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Keynes died in 1946
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Hayek was invited to debate Keynes in the '30s. Many of the currently popular economic textbook authors took their training from direct Keynes followers and wrote their books from that point of view. They are the current textbooks.
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