Another example of the decline in education. When I went back to my college 40 years after graduating I noticed a math book that looked familiar. I am a pack rat and when I got home I went through my highschool taxt books and found the same book. A freshman in college was learning what I had learned as a junior in highschool.

One of the comments, “I love realizing I’m not that smart”

… right there with you bud.

How about this comment:

“Also, for the record, John Maynard Keynes’ book is wonderful for historical perspective… but most of his ideas have been vastly revised throughout the decades by the likes of Hicks, Arrow, Tobin, etc. and all of these revised ideas constitute undergrad econ. What I’m trying to say is: you might find an intermediate macro textbook more enlightening if you haven’t already read one.

(Also, ignore all the people lauding Hayek and Mises. I guarantee that you’re not going to learn anything useful for graduate economics by reading them, seeing as their ideas are a century old. If you absolutely must read some Mises et al, at least supplement the reading with this critique. Or alternatively, start with this ~2 page critique and decide from there whether it’s worth reading hundreds of pages. If you want a more rigorous and less flawed critique of Keynesian economics, I’m sure there’s something by Robert Barro or Milton Friedman you could read. Milton Friedman has an academic book entitled “A Monetary History of the United States” which is a critique of Keynesianism and to a lesser extent Mises/Hayek, and it’s still occasionally cited today for it has some useful tidbits of information. Not sure what you’d read by Barro, but there might be something; I’m not sure.)”

Sure, ignore Mises and Hayek since their economics is “a century old”. That way, you can continue to apply mathematics to historical data and play on a computer. Funny, that whole discussion had NOTHING to do with economics. Also, to refer someone to Slate for a critique on Austrian economics is a total moron.

This is from the same University that brought you credit derivatives. I am still looking for the mathematical formula for common sense.

I’m starting graduate school in economics this semester at Kansas State U. I’m a bit nervous, as my math background is not very strong. I figure I can work my tail off and play their games until I obtain the Ph.D. Also, I found a prof. here in ag econ (switching to that program next year, hopefully) who is at least sympathetic to Austrian Econ.

Rofl they referred to the Slate “critique”? One of the most ignorant ones out there, one that has been refuted by Austrians over n over? Good job!

Speaking of math in economics (and the how it is used to spin), I was watching CNBC spin the new home sales numbers this morning without regard to the $8k in Obama money, and the fact that the deadline is fast approaching. (it was at least brought up by a later guest)

What made this truly interesting though, was their fascination that not only did the monthly sales number increase substantially, but more importantly, months worth of inventory decreased TOO! Of course, this lead them to claim that “the bottom is in!”

Yet this whole exercise rests upon a one-time distortion of the housing market, measured near the peak month, then annualized.

Do these talking heads think that the housing market is going to continue on this path once the Obama money is gone only a few months into the twelve the annualized July sales rate is based upon?

Of course not, talking heads talk, not think. Once housing sales drop off, and this statistic reverts back to the mean, we will get the opportunity to watch as the talking heads will be totally baffled by the size of the resulting increase in months of inventory (even though they will expect a drop in sales). Or must see TV as I call it.

Matt,
Though your intentions are great, I think you have a bad assumption… that Austrians are mathematically illiterate. This is not the case. It’s a methodological disagreement that causes Austrians to choose praxeology and logical deduction rather than mathematical models as a means for finding truth.

There are several Austrians whom I met this summer at Mises University who are quite strong in math. Not just students, but several of the lecturers as well. Just off the top of my head, these three guys I met:

Walter Block got his PhD from Columbia and encountered plenty of mathematical econ. He said in a lecture I downloaded that Columbia had a 2nd language requirement for phd’s, and he was terrible with languages. Fortunately, they counted ‘math’ as a language and it was by this way that he overcame that 2nd language hurdle.

Jeffrey Herbener was schooled in neoclassical tradition at Oklahoma State where he got his PhD – then after being a professor he came across Austrian economics and was ‘converted’ as he dove deeper into Austrianism.

Robert Murphy got his PhD from NYU —EXTREMELY MATHEMATICAL Program—, he studied game theory, etc. He is, in my opinion (and who the hell am I), one of the most promising young professors in Austrian Economics.

I’m sure their are more mathematically literate (or gifted, even) Austrians, just these are the guys I’m most familiar with. If you want to study Austrianism, go for it! We need all the help we can get! Just don’t assume that Austrians are currently without mathematical ability.

Don’t forget that Murray N. Rothbard was also a math major from Columbia University.

I’m a math teacher who hates math!

But in reality, a lot of the schools for economics post towering math prerequisites on their syllabus, only to cursory glance over them. Anyone with a year in calc and a year in stat should be fine–though not always

I didn’t do a math course in high school actually. I got interested with Austrian economics through one of my online friends, and found myself able to grasp the logic behind economics. But sometimes when I discuss my differences with my mainstream friends, I feel insecure about my lack of mathematical knowledge. But I could clearly see that their logical reasoning was very poor when compared with the solid backing I had from LvMI. And actually I learned more about why maths can’t explain economics usefully. So I am actually confident of my economics more than ever, and can foil any mainstream guys’ attempts to degrade me on my mathematical inability.

I’m glad I studied mathematics as part of my economics degree, at least I can use it when I go on to study something useful. And good maths skills are important in many areas of employment.

Or to put it another way: my degree in Keynesian dogma would have been a complete waste of three years without the maths. I should have asked for a partial refund.

The “critique” is pretty ignorant. Perhaps he should read Hoppe or Long or White and then come back with a more than amateurish knowledge of Austrian method and epistemology more generally?

For the record I never assumed that there weren’t Austrians who understood math. But you can explain history, and predict history in two way. One is in a story of events, the other is through a bunch of data points. Both can explain some things, and both can try to predict things. One thing I don’t see much of is Austrian economics illustrating their economic theories in the same way as mainstream economics. Not that it isn’t possible, or nobody smart enough, did, but nobody has compiled the data in the same way as mainstream. If Austrian economics is valid and useful it should be able to illustrate itself in multiple ways, one way could be related to an extremely heavy mathematical explanation. So it would be in a sense to out math the math wizzes, and not because nobody couldn’t but I don’t think many have spent most of their careers on it. Also there seems to be a vast amount of mathematical areas related to economics the quantitative finances, which gives some insight to questions like, when will the bubble pop, or what should such and such sell at, or game theory ect.

to matt:

sorry to burst your bubble, quants have no more idea about when the game is about to change than the man on the street. the last couple of years should be sufficient proof.

finance is largely built on the flawed premise of efficient markets, something that makes a warren buffet theoretically impossible (or close thereto). lognormal distributions of returns do not correlate with reality.

maths isn’t the holy grail in finance, either.