tag:blogger.com,1999:blog-1740670447258719504.post5388257612033240281..comments2024-03-18T06:41:03.841-04:00Comments on Facts & other stubborn things: Unlearningecon on Hayek and BastiatEvanhttp://www.blogger.com/profile/12259004160963531720noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-1740670447258719504.post-59078434951544882542012-10-24T16:40:22.755-04:002012-10-24T16:40:22.755-04:00"The point of Hayek's "Uses of Knowl..."The point of Hayek's "Uses of Knowledge in Society" is to restate points made by earlier marginalist economists without leaving open obvious problems by making too many assumptions. Most importantly, he makes the point about prices signaling without depending on overall general equilibrium, on perfect markets or on the labour theory of value. As I understand it earlier statements of the same idea are either quite woolly or depend on one or the other of these ideas."<br /><br />I think this is especially important important given that many textbook authors think that what authors like Hayek and Smith have been saying has been impeccably stated and summarised by the Welfare theorems of General Equilibrium Theory and thus their veracity naturally subject only to the very same strong assumptions regarding market structure and agent's perfect knowledge and "rationality." This is ironic given the efforts of authors like Vernon Smith to show just how far a mis-interpretation this is, and rather how Smith's and Hayek's vision of a market coordinating actions and allowing for the emergence of prices among mutually mal-informed traders in sparsely populated markets nevertheless actually has a far greater congruency with the findings of experimentalists over the past few decades. He makes this point very well I think in his paper on what he calls the Hayek Hypothesis. ( See Smith, Vernon L. “Markets as Economizers of Information: Experimental Examination of the “Hayek Hypothesis”.” Economic Inquiry XX (April 1982): 165–179.)<br /><br />That many Austrians have not picked up on this (Peter Boettke is a notable exception) very much perhaps can be explained by an unfortunate reluctance to look into the experimental literature influenced by their belief in the praxeological method (though I see no reason why this should necessarily be the case).Abhinoreply@blogger.comtag:blogger.com,1999:blog-1740670447258719504.post-48006277094717325342012-10-17T13:13:43.431-04:002012-10-17T13:13:43.431-04:00The point of Hayek's "Uses of Knowledge i...The point of Hayek's "Uses of Knowledge in Society" is to restate points made by earlier marginalist economists without leaving open obvious problems by making too many assumptions. Most importantly, he makes the point about prices signaling without depending on overall general equilibrium, on perfect markets or on the labour theory of value. As I understand it earlier statements of the same idea are either quite woolly or depend on one or the other of these ideas.Currenthttps://www.blogger.com/profile/08645195276844244481noreply@blogger.comtag:blogger.com,1999:blog-1740670447258719504.post-55696001560839779812012-10-17T04:43:10.579-04:002012-10-17T04:43:10.579-04:00Daniel, did you read Blaug’s article “Hayek Revisi...Daniel, did you read Blaug’s article “Hayek Revisited”? He might have a similar point to yours:<br /><br />“(…) why did his interest in the concept of spontaneous order and the history of the doctrine of unintended social consequences undergo very little development after the 1960s? All of his political writings are in fact amazingly repetitious, exploring a small number of big themes which, however, are not further refined or extended in new contexts. As organizing concepts, Hayek himself failed to realize them.” (p. 53)<br /><br />http://www.tandfonline.com/doi/abs/10.1080/08913819308443288#previewCannoreply@blogger.comtag:blogger.com,1999:blog-1740670447258719504.post-33225153061599796482012-10-17T04:37:38.581-04:002012-10-17T04:37:38.581-04:00My point, at least, is that Hayek doesn't seem...My point, at least, is that Hayek doesn't seem to have been developed on.Unlearningeconhttps://www.blogger.com/profile/13687413107325575532noreply@blogger.comtag:blogger.com,1999:blog-1740670447258719504.post-83968807556359559522012-10-16T23:59:22.779-04:002012-10-16T23:59:22.779-04:00"They write about important issues, to be sur..."They write about important issues, to be sure. But from the perspective of an economist, they write about issues that are pedestrian insofar as they already form the core of an economists' view of things. "<br /><br />Same with Keynes. Same with Menger. Same with Walras. Same with Fisher. Same with etc etc. All dead economists who contributed in their day have been absorbed into the discipline and now seem pedestrian. I'm not sure why you single out Hayek. JP Koninghttps://www.blogger.com/profile/02559687323828006535noreply@blogger.comtag:blogger.com,1999:blog-1740670447258719504.post-35232283693790360632012-10-16T21:14:02.327-04:002012-10-16T21:14:02.327-04:00Well, I think both "What Is Seen and Unseen&q...Well, I think both "What Is Seen and Unseen" and "The Use of Knowledge in Society" are great. "The Use of Knowledge of Society" is the good markets-are-powerful Hayek--as opposed to the bad markets-are-feeble-and-can't-adjust business cycle Hayek or the very bad let's-shoot-lots-of-people-in-stadiums Pinochet-loving Hayek. And Bastiat--he believes in expansionary fiscal policy to cure high unemployment...<br /><br />Brad DeLongbradhttps://www.blogger.com/profile/04548019979157668776noreply@blogger.comtag:blogger.com,1999:blog-1740670447258719504.post-85075527880618275882012-10-16T15:57:21.945-04:002012-10-16T15:57:21.945-04:00Hayek's thesis in "The Use of Knowledge i...Hayek's thesis in "The Use of Knowledge in Society" was unique at the time he wrote it, so this sentence is completely misleading,<br /><br />"Bastiat at least had the advantage of coming well before the modern work on opportunity cost, but Hayek's point had been made many, many times."Jonathan M.F. Catalánhttp://www.economicthought.net/blognoreply@blogger.com