abskebabs

I want to reply to this post specifically and may come back to reply to others when I have time. First of all you have misconstrued what kind of science economics is. It pays no attention to what factors or characterisations one can make in order to explain why man acts in a certain way. This is the task of psychology, not economics or praxeology. It rather, starts off from the notion that man acts, hence has a set of ends ranked in terms of preference or urgency taken as a given, and wishes to apply whatever means he may find to achieve these ends. This is not controversial and has formed the backbone of Micro-Economics since Lionel Robbins wrote "The Nature and Significance of Economic Science." It investigates the necessary structure of action. More importantly, It is not interested in humans as physiological or psychological beings, but as acting beings. In that sense, economics applies to any kind of acting being, human or not. The same is true for mathematics or computer science. Computer science does not ask whether a computer is a circuit board or a human writing on paper. The rules unfold as they unfold regardless of the nature of the computer. If the rules are violated, the laws break down regardless of the nature of the computer. What you have called a disadvantage,, a reliance on metaphysics is the entire point. Finally, the empirical and nominal notions, you cite as the requirement of establishing what you think would be an actual economic science actually have nothing to do with the real questions economics seeks to answer and elucidate. You have the comics, with episodes 2 and 3 linked above. Can you explain to me how making "measurements" or arranging statistical data would ever solve the diamond-water paradox, or even the imputation problem? Finally, I'll link the piece of work I recommended you to have a look at in my PM. I think others will appreciate it too: http://mises.org/journals/scholar/long.pdf It clarifies how little Misesian Economics has to do with the Cartesian brand of rationalism.

There are numerous advantages, but what I think is the chief one is its consistent application of a logical method of deduction to produce the theorems of Economics from very basic notions implicit in the concept and nature of action in the real world. This naturally may sound very contentious and nonsensical, to those with a positivistic view of science, as it did to myself when I first encountered them. The following is a set of easy to read sources that I think provide a good example of how this method of elucidation is actually utillised. At best, it may give you an idea of where I'm coming from: The first is a series of comics, although not finished, starting from very basic considerations: Human Action Comics #1 Human Action Comics #2 Human Action Comics #3 Human Action Comics #4 I think they also provide an interesting, while amusing glimpse into the intellectual history of the development of Economics. Another great, and more broad source designed for the layman is: Economics for Real People by Gene Callahan The following provides a fairly good overview of the school: http://mises.org/about/3223 Incidentally, unlike much of neoclassical economics, wholly unrealistic assumptions are not utilised, though theoretical constructions are used in a fairly strict way according to the Method of Imaginary Constructions. This is all covered in Human Action. Arguably, and as noted in the Wikipedia article Hayek was closer to the "mainstream" because of his more amicable methodological stance, and for the fact that he was in many ways, or at least tried to be; a general equilibrium theorist. Hence why John R. Hicks, an author I currently am looking at, considers much of his work in Capital and Interest theory to be along the same lines. Knut Wicksell to a lesser extent(since his work was used in Hayek's elaborations of Misesian business cycle theory), and Phillip Wicksteed to a much greater extent can be considered "proto-austrians". I don't think I have the patience or the time to debate these issues any longer, at least not for now; these discussions have taken a surprisingly long amount of time from my studies, which I think I should get back to. You did make a thread to dedicate to the subject however, so I thought these links would be useful for your discussion. Have a good one;)

And I find your responses uneducated and wilfully ignorant. The procedure chosen for the scientific investigation of bodies of knowledge and phenomena has a dependence on the nature of that which is under investigation, not the other way round. Hence the failure of J.S. Mill's attempt to create a foundation of logic as an "empirical science." Hence also the failure of the Milton Friedman's project to establish Economics as an empirical science, since you correctly state there are no measurable constants, and to even think such assumptions of constants and idealisations the Austrians DO NOT IMPLY, like perfect competition and perfect knowledge leads to fundamental and philosophical contradictions taken to their final conclusion. This does not mean however, there is no fundamentally true knowledge that cannot be gained from Economics. If one derives one's statements from little more than what is implicit in the nature of purposeful action, the existence of scarcity and the quantitative relations of cause and effect prevalent in the world, then the entire body of sound economic thought can be deduced. As I said earlier, the validity of these statements is certain but have to be evaluated ET CETERIS PARIBUS when interpreting their empirical consequences. Again, since you are vehemently debating a subject you seem to know almost nothing about and have not studied, I don't expect this conversation to get far either, and these will be my last words on this thread, and perhaps this section of the forum.

Your criticism of the terminology I used is certainly interesting. I used the word "crucial", since I thought by implying that these companies were "too big to fail", you were essentially implying that this was a problem; since due to their size, their survival was crucial to the functioning of the economy. If this is not the case, then am I correct in ascertaining that you are utillising the word "big", in a purely neutral, descriptive sense? If so, then I'm puzzled as to what the problem of letting these firms collapse is. On your second point: You are again correct in pointing out the historical fact that current conditions do not resemble that of a free market/pure market economy. However, neither the nominal conditions that describe the current state of reality, nor their heuristic development have anything necessarily to do with the logical construction of a scientific description of reality. We do start off our analysis of the mechanics of motion down slopes initially with idealistic assumptions like frictionless slopes that are at best only approxiamtely recreated in reality, and step by step introduce other elements like friction and angular momentum after analysing the ideal case in isolation. Although there are important respects in which the theoretical constructions of Economics differ; their logical construction is similiar in this regard. The definition of a market economy is that means of production are privately owned. The case where this true for all means is the pure market economy. All other cases are classified as hampered market economies. When all means of production are owned by the state, this is a socialist commonwealth. The only logically contestable procedure for developing a description of economic phenomena(note this is true for virtually ALL schools of Economics, the Austrians are simply the most consistent in its application), has been the elucidation of all features logically implied by the theoretical construction of a market economy, and only then proceeding to investigating the effects of interventions and regulations over the decisions and voluntary contracts agreed on by acting individuals within its sphere. Indeed you are already contradicting yourself in criticising such a procedure. In asking for regulation, you first depict the alleged disaster that would be brought about by the operation of a free market.

No, of course not, I cited moral hazard as an extra causal factor not the main one, and I replied to iNow in your earlier thread because he misconstrued what i said. The main factor is the distortionary effect that credit expansion through the Federal Reserve and the fraudulent fractional reserve banking system have on the development of capital structure and industrial organisation. I published an article on this forum back in February explaining both that you might want to have a look at: http://www.scienceforums.net/forum/showthread.php?t=42329 Many of these Wall Street banks that you consider too crucial to fail do not even serve much of a social function, and definitely would not survive on a free market since they do not even lend their own capital and simply utillise Fed credit to arbitrage the market.That is how they are making record profits even though the general economy is declining. You can't even claim they fulfill any social function.

If you're talking about the bailiuts and the redistrbutional Cantillon effects benefitting bankers and their main industrial clients as the ones who first receive new credit; for once I can entirely agree with you. This should never have been allowed to occur and at once we should get rid of central banks and legal tender laws to get rid of this facist favourite picking system.

Interesting, especially since you're often the first to often correctly claim that current conditions do not in any way resemble that of a free market, yet you still use our experiences of government intervention in the monetary sphere as your obvious "proof" of the failure of the free market. How "scientific" of you.

Not sure what you mean. Apart from the situation of states and "public property" that is effectively owned by no one, companies are exclusively owned by entrepreneurs or exclusive ownership is split into portions delineated among shareholders. Disputes are then settled between parties accordingly by the settlement according to contractual agreements between individuals, i.e. between creditors and stockholders. Individuals may act in groups but catallactic action like all others is vitiated by individuals, and dealt with accordingly. There is no mythical "group right", and I think you mistake the concept of property rights with your own arbitrary egalitarean whims for the redistribution of wealth.

Libertarians support the defense of individual property rights and prevention of the violation of voluntary contracts. If that means coming on the side of the employer, employee or consumer so be it.

I think I possibly should have said the "continental" meaning of the word as opposed to the specific spanish, thoug valid reference. My point was that the word liberal having socialist or social democratic connotations is only a comparitively recent phenomenon, hence the distinction between its orignal conception that is labelled classical liberalism and what is often referred to as social liberalism. Liberalism originally was a doctrine advocating the defence of individual and property rights in the form of advocating freedoms both economic and social, from arbitrary trespass on the part of the state. Hence it used to be more properly associated with thinkers like Richard Cobden, Frederic Bastiat, Gustave de Molinari etc. In the 20th century this has been significantly narrowed and diluted to only a defense of social freedoms, if that. Hence your false left-right dichotomy. For reference check out: http://en.wikipedia.org/wiki/Movimiento_Libertario http://en.wikipedia.org/wiki/Liberal_Party_(Denmark) http://en.wikipedia.org/wiki/Italian_Radicals http://en.wikipedia.org/wiki/Liberal_Democratic_Party_(Serbia_2005) Admittedly the word liberal is one with changing connotations, and I don't doubt that the current western connotations are being adopted in other countries.

Interesting that Libertarian is positioned as a characteristic of the left, I would have thought it to break the entire left-right paradigm since libertarians reject both the warfare and the nanny state. Also unsurprising is the lack of acknowledgement that liberal actually means quite the opposite of what is meant in the UK and US in the Spanish speaking world, and also the English speaking world of the past(check out Bastiat, Molinari and the classical liberals).

Depends what you mean by science. If you mean it has nothing relevant to say about the real world that is nothing more than the collection of arbitrary opinions on a certain subject, I entirely disagree. I can only slightly sympathise, as this was my opinion before engaging in a study of the subject myself. The concepts of psychic profit, loss and marginal utillity are defined in the very concept of action in the real world in the first place, in the sense we cannot reason it to occur without them. Again without reading the subject, it's very easy to dismiss it out of hand. I urge you again to read the essays I linked.

Equally, I find your responses to demonstrate very little critical reasoning or thought with regard to the concepts under discussion. You're right we entirely disagree. I brought up mercantillism precisely to respond to your claims about credit being the alleged lifeblood of the economy; a treacherous half-truth at best. You seem to miss the point that liquidation would have brought about massive deflation erasing much of the previously created artificial credit, so losses in real terms would not have actually been that high, given the drop in money supply. Indeed this is part and parcel of the entire correction process as had occured in 1921, and other recession recoveries. In any case, if you read the set of essays I linked and would like to discuss the matter further, possibly in another thread, send me a PM. I also would like to apologise for being rude eariler. The nature of what I've seen discussed on this forum lately, from defenses of marxism to utter blindly naive defenses of current economic policy has really ruffled my feathers.