What Are Some Criticisms Of The Austrian School Of Economic Thought?

It depends upon which Austrian school you’re asking about.

1) the Christian Austrians, including Menger and the Marginalists whose work has been fully integrated into mainstream economics with the exception of their certainty of the influence of the business cycle.


2) the Jewish Austrians, including Mises alone, and perhaps Rothbard, who stumbled upon Operationalism in economics, but instead of comprehending that a truthful proposition must be BOTH externally correspondent, and existentially possible to construct via a series of rationally testable operations, attempted to somehow conflate Jewish Law, and Mathematical Logic and instead, created the pseudoscience of ‘praxeology’ under which they claim all economics must be produced by a sequence of operations.

This left Mises respected but a laughing stock without a position. Unfortunately he did not understand what he had stumbled upon, and he could have reformed economics. But he failed. He failed because he was committed to his dogma, and committed to his error.

The only reason we discuss mises at all is because the Mises Institute copied the techniques of the marxists of (a) heaping undue praise, (b) creating long lists of straw man arguments by which to criticize empirical science but never producing anything more than amateurish justificationary pseudo-scientific arguments, (c) using the new medium of the internet as an inexpensive propaganda device, (d) marketing to the well intentioned fools (the young males), and entrepreneurs who, because of their success in the market, overrate their comprehension of political economy.

So why doesn’t anyone take ‘Austrian Economics’ seriously? They do. They take mengerian economics seriously: marginalism. They take the austrian project seriously: an attempt to develop a social science of political economy by which we remove obstacles to cooperation – NOT as the chicago school has done, a science of MONETARY economy, to insure against shocks to cooperation, and NOT as the saltwater (Jewish Left) school has done, which is a science of the maximum interference that is possible such that the maximum consumption is pursued, so that the maximum capital is moving, and the minimum capital is held in reserve against the most severe of shocks.

If you understand these few paragraphs you know more about the problems of the economics profession than most professors will ever dream of.


Leave a Reply