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Source link: http://archive.mises.org/14325/wanna-see-krugman-debate-austrian-business-cycle-theory/
Wanna See Krugman Debate Austrian Business Cycle Theory?
Previous post: A Really Big Show
{ 63 comments }
According to Greg Mankiw, the income tax on their bracket is high enough to be a disincentive to accepting offers to debate like these. Mankiw claims he rejects a great many conference lecture offers on account of taxes.
And many of those same individuals support higher taxes.
Which is exactly why we are offering Krugman $0. This will not affect his tax liability in any way.
people hate xtranormal cartoons but they are fun. I made a cartoon version of “our enemy the state” http://www.youtube.com/watch?v=xGkZxgzxTlk on it
I don’t think he’ll accept even if you offered him $10 million (or $50,000 from Enron!!). Problem is that any debate would legitimize Austrian theory, and that’s something he could never countenance. And, he knows Professor Murphy was clean his clock. He wouldn’t be able to ignore the real truth about Hoover and the depression, the 1920 recession and Harding, nor get away with his lies and mischaracterizations of Austrian theory. For him, it’s lose-lose all the way.
Perhaps Pay-per-view??? Somebody call Vince McMahon!!
Do you think the hostility of the Mises institute towards him might dissuade him. I checked – you guys have over 27,000 hits on this website when you do a search on “Krugman”. The New York Times’s website has well under 4,000! How many of your 27,000 mentions do you think Krugman would consider welcoming, much less professional? You have the luxury of not having a research institution out there so dedicated to villifying you. Krugman does not have that luxury, and I’m not sure why you would think he would jump at the chance to go to that institution. Would you want to?
I don’t think Krugman takes the Austrian school seriously enough to be worried about legitimizing it. That, I think, is unfortunate. I have serious reservations about the Austrian school too, but I do think there are important contributions it has to make. The socialist calculation debate is obvious. But also the macroeconomics of the capital structure are important, I think – just not as important as a solid theory of effective demand.
1. When you use the Mises serach for Krugman, it physically counts each and every time the word Krugman is used. It counts everything, including blog comments like these. For fun, put in my screen name and you’ll pull up 8,000 hits. It doesn’t mean that Mises.org is obsessed with me, it just means that my name is being pulled into the search counter, both as a comment header and respondants. Further, the search system isn’t refined enough as it also pulls up every reference of Murray Rothbard. This means that someone who posts as “Krugman Fan” gets 1 search hit for each post purely becuase of the screen name used. Refine the Krugman search to Mises Daily only and you’ll find a grand total of 8 articles.
2. The New York Times has FAR more than 4,000 references to Krugman. I have no idea where you’re getting that number from. The Times search function defaults to the past 30 days, which alone has over 4,000 references to Paul Krugman. Expanding their search function and using their search callup address bar at the top, I’m currently sitting at article 500,010 that references Krugman. I’m at a half-million Paul Krugman related articles and plog posts on the New York Times and I’m still going. Who knows where this will end?
googled: site:nytimes.com Krugman result: About 494,000 results (0.17 seconds)
googled: site:www.nytimes.com Krugman result: About 129,000 results (0.20 seconds)
googled: site:mises.org Krugman result: About 12,700 results (0.17 seconds)
googled: site:blog.mises.org Krugman result: About 8,300 results (0.19 seconds)
I went on the site and googled in their search window. I’m not sure how the mechanics of doing it on site vs. off work, but I’m not just fabricating numbers.
How about this:
1. googled: site:mises.org Krugman result: About 13,700 results (0.50 seconds) – I’m not sure why this is a thousand off yours
2. googled: site:mises.org Hayek result: About 10,300 results (0.40 seconds)Ouch – poor Hayek.
My point still stands – you all are obsessed with Krugman, it’s almost entirely negative, and a large share of it is unprofessional. Why would anyone in that position accept an invitation?
The moderator is not an Austrian, so I don’t see your point. Because some Austrians might be in the audience, there shouldn’t be a debate? Is this a serious line of reasoning? If this is the boundaries, then nobody would ever debate anyone. There will be Keynesians in the audience too I’m sure.
Why is Krugman starving the homeless, Daniel? Is Krugman just going to let them die because he’s afraid there will be Austrians in the audience? A bit cold don’t you think Daniel?
Not afraid there will be Austrians. What is there to be afraid of? I’m simply suggesting that I doubt he’d want to indulge people that are so hostile to him and rarely take his arguments seriously.
Would you?
Would you bother to invest the effort? I wouldn’t under normal circumstances, and if I had the schedule of a Nobel laureate I almost certainly wouldn’t. He’s not depriving anyone of anything – if you want to, give your money to the homeless. Nobody is making you withhold it unless he comes.
“Nobody is making you withhold it”
Ha! This worm just found the hole in this entire plan.
And I’m still confused about why you feel so vindicated by 1920.
By the way, did you get a chance to read Romer’s paper since the RAE review? I was shocked neither you nor Woods even mentioned her work on it.
Sorry!!!!! That second comment was intended for Bob Murphy!
If you’re really Daniel Kuehn, why aren’t you linked to his blog?
This video would be far more effective if GWAR was in it.
I second that!
Indeed, the video should be more like this one:
http://www.youtube.com/watch?v=5ElFtCnhSR0
I’m curious to know more details on the debate format, or is that TBD with Krugman should he accept?
I agree wholeheartedly with the cause, but what is that video? Who were we trying to grab with that exactly? Libertarians have the best product on the market, but the worst salesmen.
I thought it was obvious. They are attempting to get people who want to see Murphy mop the floor with Krugman to pony up some cash. I thought the video was rather funny and am considering putting up some money for this. Just because it didn’t work for you doesn’t mean it was a bad advertisement.
I feel like Krugman would have to accept this. I mean, he did write “Conscience of a Liberal”, after all.
I feel like Krugman would have to accept this. I mean, he did write “Conscience of a Liberal”, after all.
Except that book was a lie. An accurate “Conscience of a Liberal” would have no pages.
The self-depreciating humor is hilarious.
I appreciated it
.
That video was absolutely hilarious! It would be so exciting to see a debate between Murphy and Krugman.
Just a question before I decide to contribute. Will the debate be recorded and available for download to contributors?
I would like to contribute but don’t think I will if it is something I could not watch and study from, also I most likely would not be able to make it to the actual event, whenever it would be.
I would think it would be recorded and made available to any, like many of the videos of the Mises Institute.
It would be a legendary disaster if you managed to get Krugman to debate Bob and then ruined the whole thing by letting a moron like Ezra Klein have any role in the matter aside from getting the wind knocked out of him after reading about Krugman getting smacked down in the WaPo the day after.
The video is pretty entertaining, to those who comprehend.
But yeah, “non-believers” will not be attracted…
There are some amusing in-jokes, but it’s not all that. And the computer generated voices are annoying as all hell. I agree, not all that much here to attract those who are not already “initiated”.
I think a debate against Krugman would be pointless, anyway (except perhaps as a way of embarassing Krugman, which he so deserves). After all, it wouldn’t be a debate against Austrian theory on his side, but a debate against what he mistakenly thinks Austrian theory is. Better to get somebody who has a clue about Austrian theory, if it’s intended to be a learning experience rather than just an intellectual slap-down.
That was hilarious. I loved the self depreciating humor as well but I’m with Taylor when it comes to Ezra Klein.
I understand when someone says that Libertarians have the “best product” but we are not dealing with a marketing battle. Beta was a far better product than VHS (these are video terms for those too young to follow, LOL) but VHS was easier to handle and flooded the market. An analogy can be drawn to Libertarian vs. Statist politics. People cannot simply be “sold” on Libertarianism the same way they cannot be sold a new religion.
But they have to be sold at some point. Good ideas don’t always sell themselves, otherwise we’d all be a helluva lot freer right now. You’ve never seen a terrible commercial and been turned off on an otherwise outstanding product? I’m not saying there weren’t mildly funny parts, but as my original question stated, who is this aimed at? Who is going to watch what we just saw and get excited about it, except for those of us who have been waiting for something like this for a while? Jon Stewart could be talking about plankton and simply widen his eyes a little and he’s already got everyone in the room. How in the world can we compete with that? We can’t even come close. I don’t know. It just gets depressing after a while when you’re standing around throwing rocks at the Death Star. They even accidentally blew it up themselves and we still aren’t winning the battle for explaining how that took place exactly, so of course they’re just gonna build another one…
I disagree to some point. Here’s my humble “conversion” experience: I came across this blog some years ago with some confused ideas about psychology and legislation – and no economy education. I started arguing strongly about unavoidable repression of drug abuse in society … and was baffled by the reactions of the bloggers. Not the usual “legalize it” story. They were just so… strange – a bit like this cartoon I guess (definitely not selling me drugs anyways, nor complaisant in any way, but civilized). Some reactions I disagreed with, but you could feel between the lines there was something passionate and deep about it. Soon I discovered the scope of the publications around “Austrian” philosophy, and the fact that economy actually was much less boring a science (apologies here) that I thought. That study couldn’t be just ignored. Even the IP refutation about which I initially developed a strong allergy, has brought me a lot further.
I admire Jon stewart’s humor, but I m not sure what he’s selling either, except just wit perhaps.
And… that video is hilarious.
Why does the video imply that it’s unlibertarian to donate money to hungry people?? That’s ridiculous, and just makes us look cold and heartless.
Private charity is a-OK. This is a voluntary endeavor, not a coercive government welfare program.
It’s playing on caricatures of libertarians. That is why it’s funny. She’s not debating the other guy because her point is to sell the merits of donating to the debate itself.
This is outrageous. The Point’s website only supports very few countries as billing addresses. They don’t support my country! Outrageous. I was about to donate $50 to the campaign! Well, you can blame yourselves if you get less donations than expected. You do have supporters outside of US, UK, Canada and Australia, just so you know.
I would have pledge some money too. Cards issued in Bahamas are not accepted.
It really kills me that some people aren’t getting the humor here…..sigh. Great vid – viva la Murphy!
It should kill you worse that most consumers won’t get the subtleties of the humor. Classic marketing mistake.
I love the idea! Before I pledge, will there be a live audience and how much would it cost to be there?
Sure, let’s see Krugman debate Robert Murphy. And, while you’re at it, you can debate the question why *leading* Austrians don’t even think that ABCT is a universal theory of the cycle. Israel Kirzner on Mises.org:
KIRZNER: I’ve never felt that the Hayekian business cycle theory was essentially Austrian. In fact, Mises, who was the originator of this whole idea in 1912, didn’t see it as particularly Austrian either. There are passages where he notes that people call it the Austrian theory, but he says it’s not really Austrian. It goes back to the Currency School and Knut Wicksell. It’s certainly not historically Austrian. Further, I would claim that, as developed by Hayek, there are many aspects of it that are non-Austrian. I don’t believe that to be an Austrian you have to buy into the Hayekian view of business cycles …. I think the way Hayek developed it was not quite consistent with the way Mises laid it out in 1912
http://mises.org/journals/aen/aen17_1_1.asp
Mario Rizzo:
“The first thing to keep in mind is that while [ABCT] … embodies “Austrian” characteristics it is not an official Austrian theory. What do I mean by that? Eminent Austrian economists have made important criticisms of the bare-bones theory. For example, Israel Kirzner has criticized the theory for not taking entrepreneurship seriously. Where are the alert entrepreneurs either in the boom phase or the recession phase? There are profits to be made from avoiding mistakes. Another eminent Austrian economist, Ludwig M. Lachmann — one of the main contributors of the development of the idea of capital heterogeneity which is an important constituent part of the cycle theory — criticized the ABCT for assuming that agents simply expand their investment whenever interest rates fall. And Ludwig von Mises agreed that we need to take account of what the agents expect about the future course of interest rates. Second, the ABCT is only a partial theory of the cycle — specifically of the upper turning point. We should also not expect it to explain all business cycles — just those which are generated by excessive credit expansion to businesses.”
http://thinkmarkets.wordpress.com/2010/04/13/austro-wicksellian-theory-of-the-business-cycle-an-informed-view/
Also Schumpeter in Business Cycles ( McGraw-Hill, New York, 1939. p. 296, 303), who rejects it as a universal theory.
My advice to Krugman: criticise ABCT on the same lines as Lachmann and Schumpeter.
Ah, someone knows how to google. No suggestion to read Huelsmann’s paper on error cycles? You are familiar with that one, yes?
Also, you don’t think Krugman would be caught dead in the same room as you, do you? No need to proffer advice to him.
No suggestion to read Huelsmann’s paper on error cycle
Yes, it has a fantastic opening:
First, we challenge Mises’s [sc. business cycle] theory by arguing that it is not generally and apodictically valid. Therefore, it cannot be part of economic theory which, as Mises himself stated, is a purely logical science of action.
That’s a quote to bring up everytime someone claims that Mises praxeology has *never* been refuted.
And typically Hulsmann drags up all the discredited arguments against FRB, which even other Austrians and libertarians have rejected. He claims that if it wasn’t for the evils of FRB (along with government interventions), then the business cycle wouldn’t happen.
But regrettably for the Hulsmann, FRB wasn’t imposed by government, cannot be considered fraud on a free market, and the arguments against it don’t work. Again, Austrians cant even agree amongst themselves.
I have to say, Bala’s very harsh responses to you are quite justified; you really are a tool.
Ha! Ha! Ha!
“That’s a quote to bring up everytime someone claims that Mises praxeology has *never* been refuted.”
Who claims that? You’re pretty fucking stupid, I must say. Even as a troll, you’re obvious from a mile away. I’m just surprised Tucker allows you to spam this blog with your moronic habit of quoting Austrians who you don’t even really understand.
Hayek’s business cycle theory has been incredibly improved since Kirzern’s and Lachmann’s criticisms, by the way. Many of the issues have to do with Mises’s theory of interest, which have been criticized by Austrians such as Hülsmann and Reisman. It does not mean the Austrian business cycle theory on a whole falls apart; it means that it is refined and made more accurate.
And the fact that ABCT postulates repeated errors and stupidity by business people who somehow fail to realise that interest rates will rise?
And that fact ABCT becomes less and less relevent as loans are made for consumption purposes?
Or as Rothbard said:
To the extent that the new money is loaned to consumers rather than businesses, the cycle effects [of ACBT] … do not occur. Rothbard, Man, Economy, and State 2004 [1962]: 995–996.
Which is precisely what has been happening to the cycle over the past 20 years, in the neoliberal/Greenspan era of reckless lending to consumers? (ridiculous easy access to credit cards, consumption loans, liars loans, NINJA loans etc). So logically ABCT has become less and less relevant?
“And the fact that ABCT postulates repeated errors and stupidity by business people who somehow fail to realise that interest rates will rise?”
Rehash of a refuted “criticism”.
“And that fact ABCT becomes less and less relevent as loans are made for consumption purposes?”
Abject nonsense.
“To the extent that the new money is loaned to consumers rather than businesses, the cycle effects [of ACBT] … do not occur. Rothbard, Man, Economy, and State 2004 [1962]: 995–996.”
On which Rothbard is wrong. It will still have the effects by virtue of redirecting production to particular lines of activity. And you’re wrong: the so-called” consumer goods being purchased with this credit were in another capacity treated as “investments”. They were interest-sensitive, durable “consumers’” goods. For all we know, Rothbard means non-durable ones, in which case he isn’t wrong, just not descriptive enough. Please shut the hell up when you’ve not even thought through what you’ve read.
“Which is precisely what has been happening to the cycle over the past 20 years, in the neoliberal/Greenspan era of reckless lending to consumers? (ridiculous easy access to credit cards, consumption loans, liars loans, NINJA loans etc). So logically ABCT has become less and less relevant?”
Substitute: Keynesian era of reckless lending to consumers.
You should try harder, your arguments are like sandcastles against a tsunami.
Now, tell me what the point of all of this was?
” Now, tell me what the point of all of this was? ”
No point. Keynesians don’t have any points to make.
“And that fact ABCT becomes less and less relevent as loans are made for consumption purposes?”
The boom isn’t restricted to earlier stages of production. In fact, Roger Garrison argues that the mid stages of product are raid of their factor of product, and relatively less well off during the boom phase.
You and I clearly share a personality, this assclown annoys the snot out of me.
“And the fact that ABCT postulates repeated errors and stupidity by business people who somehow fail to realise that interest rates will rise?”
This demonstrates that you did not in fact read the Huelsmann paper, as he essentially accepts the rat-ex crititique of conventional ABCT, and indeed is one of the ways he corrects the conventional theory.
I had suspected LK was a dishonest participant here based on evasive answers he’s given on questions regarding money, and those suspicions are confirmed.
Fantastic idea.
Some suggestions:
1. Don’t get an economist or academic to chair it. Get someone who is skilled in meeting procedure, like a senior Toastmaster, with agreed points of order like no personal argumentation, no appeal to absent authority, no assuming what is in issue, no misrepresentation.
2. Don’t make it three rounds like a standard debate. Make it, each one gets so much time, say four minutes, and then the other, for as long as it takes.
3. Consider doing it in writing in blog form.
4. Consider opening the thread to the questions and comments of readers.
The best format would be in blog form. Blog form would be the best way to deal with “appeal(s) to absent authority” which are almost a certainty.
But, I think that it should be just Murphy vs. Krugman with no questions or comments. Make it a debate, not a town hall-style meeting.
WTF is the creepy movie about? It’s like some hybrid of The Office and the video for “Money for Nothing.”
I would actually enjoy the event if it was a real, live debate just because I’d love to see Bill Anderson front row center at the gig.
You can’t pledge if you live outside of US, Canada, Australia and UK. Just so you know.
Peter Schiff may not be an Austrian economist, but he is an abysmal debater who can’t go 10 seconds without chuckling like an asshole at his opponent.
“I haven’t been this flummoxed since I last smoked crack.”
Daniel Kuehn:
The entirety of Austrian School theory rests on a structure of consequent logical relationship. In order to refute some provisional conclusion, it would be necessary to identify and refute, logically, the false or improper prior syllogism which had given rise to the error.
Apparently, you are willing to accept Mises’ discovery of the “impossibility of economic calculation in the socialist commonwealth” but, even accepting that, wish to deny validity to further provisional conclusions which are consequent; I should think it incumbent on you not merely to identify the provisional conclusion with which you disagree but the (prior) logical error underlying. Were you to do that, you would identify (and distinguish) yourself not only as a thinker but as an economist, regardless of your actual vocation.
It is true that many here and in other Austrian-influenced venues are volubly “hard” on Krugman. They’re Austrian School enthusiasts and often young, somewhat immature, and Krugman’s handy.
Where else are you going to find a guy who (on 9/11 or the day thereafter) says, in a TV news interview, that the destruction “will prove an enormous boon to the U.S. economy” (a la the “broken window” fallacy lampooned by Bastiat)? Don’t quibble with me on that one, either–I heard it myself (and, though in another room, recognized Krugman’s voice immediately). The very best he could do about that “blooper” would be to plead a temporary insanity, triggered by the catastrophic event.
But I’ve never demeaned Krugman here (other than stating the above fact), though I’m an at least desultory commenter. I’m older (and wiser enough to know) that Krugman’s importance will last just as long as those who make him important wish that condition to last. That’s just the way “things” are. Krugman’s part of the socialist claque and they’ve been in semi-ascendancy for the better part of the past century. It’s been said that “people get what they want–good and hard” and Krugman’s just goes along with everything else they get (and pay for, in one way or another).
It might be worth your reflection that Mises’ original insight (the calculation problem) is not limited merely to an entity trying to “make a go” of a socialist commonwealth; it’s an inherent deficiency (you might think of it as an “anti-efficiency”) of any entity faced with a problem of allocating resources without a market for their assets. Wherever there’s a question of that nature (and every government expenditure of any kind–and likewise for non-profit organizations of every kind–. is a specimen of that nature). Absent such information (and the P & L statement that would enable calculating ROI), nothing can be known about their efficacy other than from expressions of opinion (whether by themselves, commenters in the media, or among the general public). If such were generally understood, it would go a long way toward persuading large numbers of people that the larger the government and the more areas of life in which government is involved, the worse “things” must be. It ain’t rocket science (even a street-corner pretzel vendor is in a better position to know “how’m I
doin’?” than any government economist or even the CBO). Don’t get me wrong. Austrians couldn’t “run the show” any better–they’d be up against the same obstacle; what they’d know that would be of benefit would be, simply, that “(most of ) THE SHOW MUST (not) GO ON!”
The challenge has stalled at $52,000! Is this really just going to die?
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