Quotation of the Day…

by Don Boudreaux on August 7, 2011

in Hayek, Hubris and humility, Myths and Fallacies, State of Macro, Video

… is from this short clip of a 1977 interview that my GMU colleague Tom Hazlett (then a student at UCLA) did with Hayek:

Keynes was very capable of rapidly changing his opinion….  He has been so much an intuitive genius, but not much a strict logical reasoner…. I regard him as a real genius, but not as a great economist, you know.  He was not a very consistent or logical thinker.

UPDATE: Tom Hazlett e-mailed me to say that the date of his interview with Hayek likely wasn’t 1977; it more likely was conducted in 1978 or 1979.

And I should have added earlier that in August 1983 Sandy Ikeda, George Selgin, and I interviewed Henry Hazlitt at Mr. Hazlitt’s home in Wilton, CT.  (I recall that he had a vanity license tag on his car that read “HAZ.”)  At one point during the interview, Hazlitt went on a little riff praising Keynes’s genius and intellect and sharpness of wit; Hazlitt paused in the middle of his praise for Keynes to say something like (I forget his exact words) “Of course, Keynes was a poor economist.”

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Chucklehead August 7, 2011 at 1:58 pm

His real genius was giving politicians intellectual excuses and political cover to do what they wanted to do, gain more power by spending. He made it even better by theorizing it didn’t matter how the money was spent. This meant they could raid the treasury and pay off their cronies for the good of the people. Brilliant.

Chucklehead August 7, 2011 at 2:16 pm

Not just raid the treasury, but raid future treasuries too.

Kirby August 7, 2011 at 8:47 pm

Eventually, the Keynesians will attempt to raid potential treasuries and treasuries of the imagination too

Chucklehead August 7, 2011 at 10:23 pm

So bitcoins are next and then extravagent thoughts….

Chucklehead August 7, 2011 at 10:25 pm

extravagant

GP Hanner August 8, 2011 at 11:24 am

I understand why graduate programs in economics might teach Keynesianism. But how the hell can they actually believe the mythology? They’re supposed to be thinkers and observers.

Oh. I forgot. They can believe in whatever they want. And then try to apply it to the real world whenever the opportunity arises.

Eric August 7, 2011 at 2:01 pm

Very similar to something Nassim Taleb said, either in one of his books or on an EconTalk interview… (I lean towards “Fooled by Randomness” but won’t bet on it). I will summarize here: he was a great admirer of Keynes for his statistics book, but felt his economics was bunk.

DG Lesvic August 7, 2011 at 2:11 pm

I knew Hollywood Hazlett at that time too and have been trying to chase him down ever since. So, GMU is where he’s hiding out.

Tom, come out in the open and face DG.

Ron H August 7, 2011 at 6:59 pm

He’s either one of the worst hiders in the world, or you haven’t yet heard of Google. A google search on the name “Thomas Hazlitt” brings up his web page and several references to GMU, among other things, right on the first page.

Or maybe you’re just making that up about not being able to find him..

DG Lesvic August 7, 2011 at 10:58 pm

Give that man a cigar!

Greg Webb August 7, 2011 at 2:56 pm

I think that Keynes’s genius was in promoting himself. He understood the real desires of insecure and “applause” seeking people and gave them the thin veneer of a new theory of economics to cover their theft and desire to control others by reducing the rights of individuals for “the greater good.”

Paul August 7, 2011 at 2:57 pm

There are indeed three themes to which Keynes stuck fairly
consistently throughout all his changes of outlook and interest.
These were:

1. A suspicion of fixed rules, although he sometimes, as his
1938 memoir shows, reluctantly accepted the case for
them.

2. An intense dislike of what he called the money motive. This
was not just a contempt for those who had an anal fixation
on the accumulation of wealth for its own sake rather than
what it could buy. It was a hostility to the whole idea of
material gain as a motive. Indeed, what attracted him to his
first great hero, the philosopher G. E. Moore, was that he
believed that the latter had for the first time disposed of
the Benthamite calculus of pleasure and pain as a guide to
conduct. A contempt for business and money-making was fairly
common among comfortably off Oxbridge intellectuals.
What marks Keynes out was the combination of this contempt
with a strong personal interest in the detailed processes
of money-making in the City, going far beyond anything
possessed by most mainstream utilitarian economists.

3. An interest in non-conclusive inference – that is, the logic of
drawing tentative conclusions from facts or propositions
that could not be known with certainty. It was this that
formed the basis of his work on probability.

Dan J August 7, 2011 at 6:25 pm

When those who invoke Keynes or any other philosophy that finds disgust in materialistic gains rid themselves of all things that represent the materialism, then I will accept that they truly believe it. I will not join them, just believe they walk the talk.

Invisible Backhand August 7, 2011 at 8:03 pm

I feel the same way about 99% of those who claim to be Christian.

Ken August 7, 2011 at 8:32 pm

IB,

As always, you have the best economic insights.

Regards,
Ken

Invisible Backhand August 7, 2011 at 8:37 pm

As always, you provide the non sequitur.

Ken August 7, 2011 at 9:25 pm

IB,

You keep using that word. I do not think it means what you think it means.

Try this one: clueless. You call my comment a non-sequitur, but I’m guessing you think your comment about Christians was somehow relevant to the post and/or Dan J’s comment. It wasn’t.

Regards,
Ken

Kirby August 7, 2011 at 8:49 pm

Right. Material things like money, or food, or housing, or water. We will simply eat and drink in our mind instead.

Methinks1776 August 7, 2011 at 4:27 pm

Blasphemy.

Malthus0 August 7, 2011 at 4:51 pm

The precise date is November 12, 1978. My original dating in the video title & discription was clearly off. But that was before there was much info about these interviews on the internet. Luckily the full video with exact date is at the UFM Hayek interview archive.

http://hayek.ufm.edu/index.php?title=Tom_Hazlett

Invisible Backhand August 7, 2011 at 5:59 pm

What does he think of what he said back then? Still accurate?
————————————
The policy of inflation, as I have said, is partly imposed for
its own sake. More than forty years after the publication of John
Maynard Keynes’ General Theory, and more than twenty years
after that book has been thoroughly discredited by analysis and
experience, a great number of our politicians are still unceasingly
recommending more deficit spending in order to cure or
reduce existing unemployment. An appalling irony is that they
are making these recommendations when the federal government
has already been running a deficit for forty-one out of the
last forty-eight years and when that deficit has been reaching
dimensions of $50 billion a year.

An even greater irony is that, not satisfied with following
such disastrous policies at home, our officials have been scolding
other countries, notably Germany and Japan, for not following
these “expansionary” policies themselves. This reminds
one of nothing so much as Aesop’s fox, who, when he had lost
his tail, urged all his fellow foxes to cut off theirs.
One of the worst results of the retention of the Keynesian
myths is that it not only promotes greater and greater inflation,
but that it systematically diverts attention from the real causes
of our unemployment, such as excessive union wage-rates,
minimum wage law’s, excessive and prolonged unemployment
insurance, and overgenerous relief payments.

Henry Hazlitt, 1979

Methinks1776 August 8, 2011 at 6:38 am

He probably doesn’t give a damn, seeing as he’s dead.

Economiser August 8, 2011 at 1:55 pm

Lord Keynes, meet Long Run.

Greg Webb August 7, 2011 at 6:12 pm

Invisible B, Tom Hazlett is not Henry Hazlitt. But, thanks for the good and accurate quote from Henry Hazlitt. I enjoyed reading it.

Invisible Backhand August 7, 2011 at 6:21 pm
Greg Webb August 8, 2011 at 12:11 pm

DG, there you go again. My what a pompous ass you are!

DG Lesvic August 7, 2011 at 6:56 pm

If you want some more quotes from Henry Hazlitt, taken from his correspondence with me, and unpublished, except by myself, and upon the most important topic, let me know and I’ll link you to it.

DG Lesvic August 7, 2011 at 6:59 pm

And that will also link you to my recall,but without actual quotes, of Tom Hazlett’s discussion with me, and of many others, including Rothbard and Kirzner. As for Hayek, I received a very kind letter from him but no comments. And, Mises, alas, I knew only through his writings. That’s the big one I missed.

Oh, well, I still have Greg..

DG Lesvic August 7, 2011 at 7:00 pm

The Rothbard and Kirzner are with actual quotes.

DG Lesvic August 7, 2011 at 11:05 pm

Oh, and Don’s teacher, too, Machlup.

Very interesting contrast between his response and Kirzner’s, the one NYU professor complimenting my presentation and the other disparaging it.

So, students, don’t let any one prof get you down.

DG Lesvic August 7, 2011 at 11:08 pm

I have to say that I disliked Machlup and was not surprised to learn that he aroused Mises’ ire.

DG Lesvic August 7, 2011 at 11:15 pm

Why should I leave you wondering. Machlup said my writing was “really not acceptable,” and, while Kirzner didn’t agree with my thesis, he “found it written with keen intelligence.”

Sorry, boys.

Dan J August 8, 2011 at 12:00 am

Desperately, in need of some recognition or acknowledgement, are ya?
I have said that math is not paramount to understanding basic economics. Math is helpful in teaching and accepting economics. But, to convince the obstinate math may be necessary. I cannot comment into advanced Econ.

DG Lesvic August 8, 2011 at 1:55 am

Dan,

You couldn’t resist the dig, but that’s alright, for one of you bastards has finally halted the ad hominens long enough to actually get into economics. And that’s a miracle out of scripture.

OK, Danny Boy, give me an example and I will promise to remain in Cafe Hayek forever.

The rules, for those of you who need to be told:

First, the object of the inquiry is truth, not falsehood. That means that the example has to be true, not false. If false, it’s not an example. It’s an attempt at an example, but not an example. For it to be an example, it has to be more than an attempt at one, it actually has to be one.

You must start out in English. For that’s our first, native language, and we could not evaluate your translation into the foreign language of mathematics without knowing what you were translating from.

So you state both the problem and the conclusion in English, and the point along the way at which you would switch to math, and the reason for doing so, before actually making the switch.

For, to start out with the math was not to prove but assume its superiority, and not answer but beg the question.

Who decides whether your example was true or false? Since we don’t have God to do it for us, nor any human being we can be sure is both competent and disinterested, I will decide for myself, you for yourself, and everybody else for themselves.

And we agree to disagree like gentlemen, not Nazis. Understanding that honest men may disagree, we don’t take disagreement as a sure sign that the other fellow is dishonest, but afford him the benefit of the doubt, thank him for his efforts, and continue as best we can fighting our real enemies, and not just ourselves.

If that’s alright, let’s get on with it, but, if it’s asking too much, don’t start with me.

I have been predicting for many years now that no one could up with the example, and so far, no one has. If you succeed, you will be the first. And whether I acknowledge your triumph or not, it will be here for all to see. And I am sure you that will receive fairer treatment than I did, and all the fruits of your victory.

May the better economics win.

Dan J August 8, 2011 at 2:24 am

Oh, you are incorrigible. In teaching a student basics of economics who requires the lecture and Q&A to grasp the concepts the mathematics is useful in advancing their understanding and/or reinforcing concepts. I understand this concept is your life and cannot rest until there is recognition. A bit on the insane side, but…… You are too far removed to recognize the assistance that mathematics in learning provided.

DG Lesvic August 8, 2011 at 3:57 am

Dan,

Thank you for your courtesy.

DG Lesvic August 8, 2011 at 4:15 am

From the Summary of my book:

As the introduction of mathematics into economics and of redistribution into public affairs have been the twin roots of all political evil over the last hundred years, their expulsion will be the twin roots of redemption. But it will not be achieved by Libertarianism and the Austrian School of Economics. They are terminally sclerotic and have gone as far as they can go. The task has fallen to a new generation and vanguard of liberty, Voluntarism and No School Economics.

John Sullivan August 8, 2011 at 2:15 pm

Tell me about your book, if you don’t mind?

Do you write much?

DG Lesvic August 8, 2011 at 4:19 am

Also, new ideas are only for the young, for they rebuke the old.

DG Lesvic August 8, 2011 at 4:31 am

Also,

Intellectuals cannot stand being outshined, especially within their own group, and must diminish its brightest light.

So thanx for the compliment, fellas.

John Sullivan August 8, 2011 at 9:21 am

The contribution of Keynes was Machiavelian, of sorts. One of the posts above accurately described his contribution as political, which is how he’ll ultimately be remembered.

For the politician seeking to pay back his constituencies, or those he does his bidding for, or who own him, he first needs access to the printing presses, then can proceed to execute his dirty work. Unfortunately, the stealing he does may lead to overall economic consequences (booms and bust cycles) that might awake the public as to what is going on, to cause alarm, and to possibly jeopardize his political career. His objective, therefore, is to figure out ways upon which to steal without being detected.

So, the politician has two choices. He can stop stealing and inflating and try to win reelections based on other criteria, or he can try to figure out a way to smooth out the recessions and depressions so that the poltical repercussions will be minimized. The first remedy is rejected out of hand. Enter Lord Keynes, the economic witch doctor, who shows the politicans how to spead out the losses to the population so that the theft isn’t really discernable.

DG Lesvic August 8, 2011 at 11:44 am

John,

You’re right.

I would add this. Another of Keynes’ contributions was obfscation, impenetrable, intimidating language, and especially the foreign language of mathematics, which is nothing but a means to the trade unionization of economics, a barrier to entry, and license to practice economics.

Keynes carried the mystification and alienation of economics to its highest point. And that is what made him the worst man of the century. Hitler and the others were merely the outgrowth of the groundwork he laid.

Why did he succeed when there was no rational basis for his work? We’ve seen the answer right here before our own eyes. He told the economics profession what it wanted to hear, and intellectuals believe what they want to believe. Just as all the Ya me too people here want to believe that the one No, not me too person is a non-person, they wanted to believe that economics was their exclusive domain.

DG Lesvic August 8, 2011 at 12:46 pm

Of course that wasn’t exactly right. You could hardly blame the rise of Hitler on a book published in 1936. Keynes merely carried the bastardization of economics to its highest point. But it began long before him, with Marshall, with Jevons? With the mathematization of economics, certainly. That, and the introduction of redistribution into public policy are the twin roots of all political evil in our time.

And while it appears that the Austrian School doesn’t know that, what it really doesn’t know any more is Mises, even the Mises Institute doesn’t know him. He would hardly have censored dissent.

It is hard to see what separates at least some segments of the so called Austrian School today from the Chicago School.

DG Lesvic August 8, 2011 at 1:50 pm

By the way, the aforementioned Tom Hazlett was, at least during the time I knew him, one of the so called Austrian School economists who had never troubled to read Human Action. The Austrian School without Human Action. Some Austrian School.

John Sullivan August 8, 2011 at 2:30 pm

Anyone who understands praxeology knows that human action can’t be quantified. The logic of a priori reasoning is equivalent to math, such as is demonstrated by Mises’s quantity theory of money, but historical human action is unique and can’t be explained by mathematical equations, econometrics, etc. But isn’t math useful to explain that if the money supply is increased without a concurrent increase in the goods and services available for consumption, that prices will rise? The errors occur when economists seek to quantify by how much each thing will rise.

However, that doesn’t mean that econometrics is useless as a means for economic calculation. All economic planning and capital investment are based on speculation, since nothing is ever certain in the economic sphere, but that doresn’t mean we should make educated guesses and assumptions based on historical data.

I don’t think it’s wise to treat Keynes as if he was a dictator, such as the way it’s been done to innocents such as Nietzsche and Wagner, and besides, from a different perspective, what’s wrong with dictatorship anyway? The dictator is the last person who should be blamed for dictatorship. The passive masses should be the ones blamed.

John Sullivan August 8, 2011 at 2:32 pm

Sorry, I meant that “it doesn’t mean we shouldn’t”

Sam Grove August 8, 2011 at 7:11 pm

But isn’t math useful to explain that if the money supply is increased without a concurrent increase in the goods and services available for consumption, that prices will rise?

Seems to me that is a logical exercise.
Math is used to quantify and produce results from quantifying, but in economics not all factors can be quantified.

vikingvista August 8, 2011 at 11:16 pm

“in economics not all factors can be quantified.”

And in medicine, not all diseases respond to treatment. Using this great DG Logic, we can therefore conclude that treatments have no place in medicine.

Sam Grove August 13, 2011 at 5:40 pm

In medicine, math can be used to predict the statistical probability of a treatment being effective, however, you don’t need math to understand if a treatment has been effective, or even if the treatment will be effective in any particular case.

Logic is as fundamental as mathematics.

In John’s comment, the deduction that an increase in the money supply without a concurrent increase in the availability of goods and services will result in an increase in prices is logical.
You would use mathematics to predict how much prices would rise, at least theoretically.

vikingvista August 8, 2011 at 11:44 pm

“But isn’t math useful to explain that if the money supply is increased without a concurrent increase in the goods and services available for consumption”

You don’t need even that high a level of economic conception. Math is useful to describe the effect of ordinality of two traders’ values, or the diminishing marginal utility people experience, or the concavities of supply and demand curves, or–the eternal mystery in DG’s life–the meaning of price.

These are some of the ways that both Mises and Rothbard used mathematics to explain economic concepts. Wherever exist quantities, even if only ordinal, mathematics is relevant. And a great deal of economics deals with quantities.

This is juxtaposed to the DIFFERENT notion of “mathematical economics” that Mises wrote about.

Greg Webb August 9, 2011 at 12:07 am

Good analysis and explanation, Vikingvista!

DG Lesvic August 8, 2011 at 3:14 pm

John,

What a pleasure to be able to discuss these things with someone who actually knows what he’s talking about and is willing to discuss them civilly.

I am afraid we are a vanishing breed, the vanishing economists.

I agree substantially but not completely with what you say.

You wrote:

“But isn’t math useful to explain that if the money supply is increased without a concurrent increase in the goods and services available for consumption, that prices will rise?”

I fail to see how.

You wrote:

“However, that doesn’t mean that econometrics is useless as a means for economic calculation.”

Surely you’re not going to confuse econometrics with economics, its passing data with its eternal truths. While economics explains economic calculation, it doesn’t engage in it. While of course the calculator himself needs math, the explainer of it does not.

Thank you again for the sheer pleasure of discussing economics with someone knowledgable and reasonable. Next to seeing my grandchildren, that is this old man’s greatest pleasure. What a shame that so many here cannot share it and will never know it, that to them reason, science, and economics is nothing but an insult and outrage.

John Sullivan August 8, 2011 at 4:13 pm

In monetary theory, the prices of the goods and services are a mathematical function of the available money stock, or one couldn’t claim that the addition of more money means that prices would rise. This mathematical relationship exists at the same time that it is impossible to quantify, do to human action being unpredictable as to what the resulting supply and demand for everything will be. Everything is in a constant state of flux, so nothing is measureable or quantifiable, but the statement that the addition of more money into the economy will cause prices to rise in relation to what they would have been without the injection of money still holds. There would be no Austrain Theory on this topic without the underlying mathematical relationship between the quantity of money and the available stock of goods and services. If you increase money, prices go down, and if you leave the money alone but increase goods and services, prices come down.

Further, math is used to establish economic principles all the time. Look at Ricardo’s theory of cost advantage to see an example. Study the law of returns too. I’m sure you are aware of this. I’m not suggesting you aren’t. But the point that Mises was making about math was that it was the use of ordinal numbers, a ranking process, that was learned from human action, rather than a measurement process. We might know that A preferred one thing over another by his action, but we could never measure by what amount he preferred it. The attempt to measure in that regard was the fallacy.

Let me clarify my thinking on econometrics. I see it as a highly useful application for economic analysis for private businesses with regards to forecasting, but it is not in the category of economic theory, and shouldn’t be confused for it, just as cost accounting isn’t economics either. Economic calculation is not economics, but that doesn’t mean it can’t be valuable.

Math is logic, and so is the reasoning of economic theory, although future human action can’t be reduced to mathematical equations descriptive of past events.

I don’t see where we have a difference anywhere as much as a misunderstanding.

John Sullivan August 8, 2011 at 4:15 pm

sorry, anothewr correction from the end of 1st paragraph—if you increase money, prices go up.

DG Lesvic August 8, 2011 at 5:07 pm

John,

It sounds to me like you’re trying to have it both ways, math is and isn’t useful in economics. It’s useful in real life, but economics isn’t real life, it’s about real life, but not real life. It teaches us at least a part of what we need to know about the market, but isn’t the market, and what is useful in the market is not necessarily useful in the science of it, economics.

Math is of no use in the science of the market, economics.

You wrote,

“In monetary theory, the prices of the goods and services are a mathematical function of the available money stock.”

The prices of which goods and services? And just what is the amount of the function? If you increase the money supply by 10%, does that mean that the prices of all goods and services will rise by 10%. I don’t have to tell you that they will not, that the newly injected supply of money will affect the prices of some goods and services before that of others. Does it mean that the overall price level will rise by 10%? I don’t have to tell you that the effect of the increase in the money supply will be complex, that it will affect not just the absolute number of dollars in circulation but the velocity of their circulation, and thereby the effective as well as nominal quantity of dollars. So where is there any constant relation, or “mathematical function,” between the amount of money added to the money and supply and the prices of goods and services? All that an economist can say is that, ceteris paribus, an increase in the money supply will tend to bring about an increase in prices. And he doesn’t arrive at that conclusion through any mathematical operations but only by conception and deduction.

Then you wrote,

“This mathematical relationship exists at the same time that it is impossible to quantify.”

If it can’t be quantified, what makes it a mathematical rather than “logical” relationship. What separates math from logic other than its quantitative relationships?

Then, with your good cop and bad cop routine, you switch into the good cop mode, saying “Everything is in a constant state of flux, so nothing is measureable or quantifiable.”

Exactly. But then here comes the bad cop again:

“There would be no Austrian Theory on this topic without the underlying mathematical relationship between the quantity of money and the available stock of goods and services. If you increase money, prices go down, and if you leave the money alone but increase goods and services, prices come down.”

Right, but where is the mathematics in that, where are the actual quantities?

We’re told that there is a non-numerical as well as numerical, qualitative as well as quantitative mathematics. But while the theory and formulas are literary or symbolic rather than numerical, there are no applications of them without cardinal numbers.

Where any cardinal, calculable numbers in economics, and any actual mathematical operations?

Bad cop again:

“Math is used to establish economic principles all the time. Look at Ricardo’s theory of cost advantage to see an example. Study the law of returns too. I’m sure you are aware of this.”

Actually I’m not aware of the Law of Returns. But I fail to see any math in Ricardo’s Theory of Comparative Advantage. Where are the numbers, other than for purposes of illustration?

You may certainly illustrate a point by means of cardinal numbers. I have done so. But the illustrations are merely incidental to the proof, and economics is defined by what is essential and not merely incidental to it.

I wouldn’t rule out numbers, symbols, and shorthand altogether. I have used them myself, as in “engineers earned $50M and janitors $10M and “you and I exchange my A for your B and your B for my A…”

The problem is not their use but abuse. Economics is always simple, but a single factor of change in an otherwise unchanging world, A and B, but not A and B and the rest of the alphabet, or $50M and $10M, but not $50M and $10M and exponents of them, and only to illustrate a point, not prove it.

You wrote,

“ Economic calculation is not economics, but that doesn’t mean it can’t be valuable.”

Who said it can’t be valuable? I just said, as you have, that it was not economics.

You wrote,

“I don’t see where we have a difference anywhere as much as a misunderstanding.”

But that’s what differences are, between honest men.

Anyways, keep those fallacies coming, you miserable lying sonofabitch.

John Sullivan August 8, 2011 at 5:31 pm

Sticking with the first issue, about there being a mathematical relationship between the stock of money and the stock of goods and services, I’ll say there is, but that we can never know it. Now, the existence of a mathematical relationship does not mean that there it is an equation. And just because humans can’t calculate something due to not having enough information, doesn’t mean that the relationship doesn’t exist.

If the available stock of goods are measured in money terms, then if you increase the quantity of money without increasing the stock of goods, the prices for the goods will rise. That’s the relationship. Do you agree or diagree?

Now this is logic. If goods A, B, and C are measured against each other in terms of a monetary unit of a given supply, and then you simultaneously doubled the supply of money by giving everyone double the quantity that they held, the prices would double for the goods.

In practice, the reason why the prices wouldn’t double is because the new money doesn’t enter the economy equally for everyone, but it tends to work in that direction.

I can bring Mises into this if you like. if you don’t believe me, you might believe him when I quote him essentailly saying what I just wrote.

DG Lesvic August 8, 2011 at 6:05 pm

No need to rouse Mises from his slumbers. Let him be. I agree with everything you said after the first paragraph.

In the first you said there were mathematical relationships but we can never know them. Then of what use are they?

Then you said that there could be mathematical relations without equations. I don’t see how. Mathematical laws and formulas necessrilly imply constant relations between magnitudes.

You said that “just because humans can’t calculate something due to not having enough information, doesn’t mean that the relationship doesn’t exist.”

What difference does it make whether it exists or not if we can’t make any use of it?

John Sullivan August 8, 2011 at 6:38 pm

The Austrians argued against there being a ‘proportionality’ with respect to price increases with regards to there being an increase in the money supply. That is different than what I’m saying.

Money is used to describe exchange ratios between goods and services. If only the quantity of money is changed, the prices will change to reflect it. It is logic. If A = 2b, then 2A =4b. I call it a mathematical relationship. It’s surely logic. Money is defined as that which expresses exchange ratios between the available goods in an economy. One is a function of the other; each is defined by the other, a priori.

Without a mathematical relationship between the amount of money and the amount of goods, one couldn’t make the claim that printing money led to inflation.

The relationship is a general a priori principle. Each component is in the definition of the other. You can’t refute it. Money has a mathematical relationship to the exchange ratios it expresses.

But because prices are only historical data and because the exchange ratios as expressed by money are in a constant state of change, any attempt to use mathematical formulas to say what prices will be are futile–unless that person were omnipotent and knew what the future valuations and behavior of everyone would be.

You can look up Ricardo and the Law of Returns. My point is that math is used, as logic, to support some of the Austrian therories. It is even required to make an argument for the division of labor and the combination of labor being more productive than solitary labor. One needs to use the logic of math to make points.

Math is logic. The Austrian’s claim their theories to be logic, so they use math as a tool to explain their theories. However, they don’t make specific predictions using math equations. They just use general relationships that use ordinal numbers–rankings. The don’t use of cardinal numbers. For example, they would argue that price controls cause shortages. This has a mathematical element in it. There is a mathematical relationship of which can merely understand the general meaning of, without knowing the details.

As far as me being a miserable lying sonofabitch, you’re probably right about that.

DG Lesvic August 8, 2011 at 7:27 pm

John,

You wrote,

“If A = 2b, then 2A =4b.”

In mechanics yes, in economics, no.

You wrote,

“I call it a mathematical relationship. It’s surely logic.”

When you make up your mind, let me know.

You wrote,

“Without a mathematical relationship between the amount of money and the amount of goods, one couldn’t make the claim that printing money led to inflation.”

Give me an example of the mathematical relationship, such as $100 and 100 lbs. of butter.

You wrote,

“Money has a mathematical relationship to the exchange ratios it expresses.”

Yes, but you told me so in English, not mathematics.

Now, finally, the good cop emerges.

“attempt to use mathematical formulas to say what prices will be are futile–unless that person were omnipotent and knew what the future valuations and behavior of everyone would be.”

Now you get the ceegar.

No, give it back. You wrote:

“My point is that math is used, as logic, to support some of the Austrian therories.”

For instance?

“ It is even required to make an argument for the division of labor and the combination of labor being more productive than solitary labor.”

Show me.

“One needs to use the logic of math to make points.”

But not math, just logic, the logic of economics, not math.

The theory and formulas of math, or the logic of math, is that of cardinal numbers. That of economics is of ordinal numbers. You can calculate by means of the cardinal numbers of math. You cannot do so by means of the ordinal numbers of economics. There are only ordinal and not cardinal numbers in the theory of economics, hence only logical and not quantitative analysis. You may illustrate the principle with an example from real life, but no example from real real life can prove or disprove a theorem of economics..

“Math is logic.”

And strawberry ice cream is vinegar and vinegar is strawberry ice cream.

You wrote, the Austrians “would argue that price controls cause shortages. This has a mathematical element in it.”

What is it?

“There is a mathematical relationship of which (you) can merely understand the general meaning of, without knowing the details.”

The devil is in the details.

“As far as me being a miserable lying sonofabitch, you’re probably right about that”

You’re the best economist here, well the second best, and a distant second at that.

Don, of course, is the best.

John Sullivan August 8, 2011 at 8:02 pm

You seem to miss the point. I understand where math begins and ends in economic theory and I am fully aware of everything you’ve said about Austrian theory on this topic.

I’ll repeat my point one more time. Math is used as logic in ordinal ways–such as saying something will be greater or lesser, higher or lower, more or less valued, rather than precisely measured. Yes, you know this too.

But you were asserting that math wasn’t used in Austrian theory. I am saying it is used to prove every point they make. This is because I understand math to be logic, and I’m not usre what it means to you.

One more example: The creation of wealth

How can you demonstate how wealth is created without reference to math as logic?

Here is a typical method of how wealth is created. A producer produces something for consumers cheaper than what it cost before. No matter what the savings, it represents a creation of wealth. The sum is then available for additional consumption or investment. Now, if in lowering the price, the producer laid off excess workers who sadly lost their jobs, some people would argue that no wealth had been created.

How can the question of whether wealth had been created be resolved? Only through the use of math would this be possible. The consumer savings, of course, leads to increased consumer demand in other things, which considering the scarcity of labor, will lead toward the reemployment of anyone who lost their jobs. But this doesn’t answer the question.

The question was already answered. The savings is the new weath and it is calculated in money terms using math. The money represents purchasing power and is not the wealth itself. The wealth is the additional amount of goods the consumers can buy with the money. The fact that labor changes from one thing to another is irrevelant to the question.

But the concept of ‘savings’ and ‘wealth’ use math as logic. That was my only point. Every thing else you wrote about was merely your misinterpretation of my original post.

You are the one who referred to me as an economist, not me. I’m not, and if I were, I’d be getting paid for my opinions rather than goofing around here between endeavours of more importance to me. But whether or not someone is a professional economist doesn’t make them right and the non professional wrong. All cases still need to be debated on their merits rather than on the status of the people involved.

DG Lesvic August 8, 2011 at 10:41 pm

John,

I just gave your latest a cursory glance, but it seems to me that what it boils down to is your confusion of logic with math. Logic is math. Economics is logical. Therefor it is mathematical.

To put it simply, there are three divisions of reason:mathematics, logic, and praxeology. It is mathematics that tells us that two and two is four, logic that you may prefer A to B or B to A, but not both, and praxeology that quantity demanded goes down as price goes up. While mathematics and logic are out of time and space, praxeology is within it, the science of human action, always through time and space. With semantic license, we may simply say logic when we mean praxeology. But there is a difference. For praxeology is specifically the science of human action, and economist its “best elaborated part.”

Human Agony, P 3

While we have been talking about logic, what we really meant was praxeology, which differs from logic and math by the fact that it is always through time and space, I repeat, through time and space, whereas logic and math are out of time and space.

Even if you can’t see the difference between logic and math, can you at least see the difference between praxeology, through time and space, and math, outside of it?

You seem to think that because you are not a professional economist you are not an economist. I would put it the other way, that because one was a professional economist he was not an economist but a businessman, with the exception of the very few honorable amateurs, which literally means lovers of the science.

DG Lesvic August 9, 2011 at 2:59 am

I said honorable amateurs.

I meant honorary.

“All professions conspire against humanity,” and all professional economists against economics, with the exception of the honorary amateurs. I’m sure there are many, and while I certainly don’t want to get into the business of passing judgment on individuals, I must mention a few who, whatever my differences with them, I am indebted to, especially White, Boettke, Roberts, Boudreaux, and Ebeling, my honorary amateurs. And a very special thanks to Horwitz, my bitterest foe, and, in his way, biggest booster.

However flawed, as we all are, these are great, great men.

God bless ‘em.

DG Lesvic August 9, 2011 at 12:15 am

John,

As to the difference between logic and math.

Math is simply counting, indirect counting, a short-cut method of counting, an “abridged form of counting.,” but still nothing but counting.

Economics is not counting but thinking. Acting man in the market counts, but the economist analyzing his action does not. What matters to acting man is the countable objects of his action.
What matters to the economist is not the objects of it but the action itself.

The countable objects of action are the data of the market. But that is constantly changing. How could you derive what never changes from what constantly changes, the eternal truths of the market from its passing data?

How could you construct an economic theorem upon the shifting sands of statistics?

How could you observe the Invisible Hand, and, if you couldn’t observe it, measure, count, or calculate it?

DG Lesvic August 9, 2011 at 2:46 am

John,

You asked about my book. You can access the whole thing, entitled Dumb Jews, online, by clicking on my name here in blue.

DG Lesvic August 9, 2011 at 3:02 am

I hope you all noticed my correction above, where I had said

honorable amateurs, which meant nothing

I meant honorary amateurs, which of course refers to the rare professionals who truly love the science like amateurs.

DG Lesvic August 9, 2011 at 3:06 am

Sam,

Above you wrote,

“Math is used to quantify and produce results from quantifying, but in economics not all factors can be quantified.”

That’s hitting the target but missing the bullseye.

There is no quantification at all in economics. What’s to quantify?

Since statistical measurements are always of past events, never exactly repeating themselves, they are irrelevant to the eternal and immutable laws of economics, always exactly repeating themselves.

DG Lesvic August 9, 2011 at 3:09 am

I don’t know of anyone who ever said it better than Henry Kaufman, the famous Wall Street investment titan.

Since “history never exactly repeats itself…the real challenge is to identify what is different in the current situation from the past. Mathematical equations based on historical data are unable to make such judgments.”

DG Lesvic August 9, 2011 at 3:34 am

Viking,

Sorry that I missed your comments above.

It seemed to me you were confusing ordinal with cardinal numbers, and thereby mathematics with economics. Math refers to the action of counting, economics to that of choosing and setting aside, of preferring A over B, B over C, C over D, A first, B second, C third. The ordinal numbers, first, second, third, are the only numbers in economics. But they are not mathematical. You cannot count with them, add, subtract, multiply or divide with them. They have nothing to do with mathematics The presence of ordinal numbers in economics is not the presence of mathematics in economics. And since there are no cardinal numbers in it, no ones, twos, threes, no countable, calculable numbers, there is no mathematics.

yet another Dave August 9, 2011 at 4:22 pm

So DG, are you saying ordinal numbers are not part of mathematics?

DG Lesvic August 9, 2011 at 9:51 pm

Dave,

I had posted a response to you quite a while ago, but it hasn’t shown up yet. It may yet do so, but just in case, here’s a different one.

When I said that ordinal numbers had nothing to do with mathematics, I was referring to the actual operations of the science, and not to its development. Whether they played a role in its development or not I do not know, but I know that they play no role in the actual operations of the fully formed science itself.

DG Lesvic August 9, 2011 at 11:20 pm

And I would add that the development is not the science, any more than a blueprint of it is the actual product. While logic was essential to the development of mathematics, the end result of the process, mathematics itself, went beyond the method of its development, from logical to quantitative thinking, of which ordinal numbers are no part.

DG Lesvic August 10, 2011 at 12:29 am

Dave,

Thanx to your prodding, I have added this to my book.

They tell us that there is a non-numerical as well as numerical, qualitative as well as quantitative, mathematics. That is to confuse the development of the science with the science itself, and the theory with the practice. While its development was carried out through logical thinking, the result was quantitative thinking. And while its formulas are symbolic, there is no application of them without actual numbers. And it is precisely its ultimate numerical and quantitative nature that distinguishes it from its non-numerical, non-mathematical logical roots.

And I hope that this will be a lesson to those who can’t stand being challenged, that that is precisely what makes us better.

DG Lesvic August 10, 2011 at 7:48 am

Here is a little better way of expressing it.

They tell us that there is a qualitative as well as quantitative mathematics. That is to confuse the development of the method with the method itself, and its formulas with their applications. While the formulas are literary or symbolic, there is no application of them without actual numbers. And while their development was qualitative, their end results are quantitative. There are not two different methods of mathematics, qualitative and quantitative, but merely different stages in the evolution of the one method, from its qualitative basis to its quantitative results.

yet another Dave August 10, 2011 at 2:14 pm

DG, you continue to reveal a thorough misunderstanding of mathematics but you’ve stated it explicitly enough for me to see where (at least part of) the problem lies. {Before I continue, let me assure you I’m not advocating improper use of mathematics in economics – I’m merely addressing your misunderstanding.}
You have (at least) two fundamental misconceptions about mathematics.

- – - Misconception 1 – - -
This statement, referring to mathematical formulas, is simply wrong.

…there is no application of them without actual numbers.

This earlier statement reveals the same error:

Right, but where is the mathematics in that, where are the actual quantities?

Mathematics absolutely does not require actual numbers – it does not require the ability to calculate a numerical result. The fact that a quantitative relationship exists between variables is not dependent on knowing their exact numerical values. Such a relationship can be expressed mathematically, and such an expression can be very useful for illustrating proportionalities and dependencies. None of this requires actual numbers and all of it is mathematics.

- – - Misconception 2 – - -
I also found this previous statement:

So where is there any constant relation, or “mathematical function,” between the amount of money added to the money and supply and the prices of goods and services?

And this one:

Mathematical laws and formulas necessrilly [sic] imply constant relations between magnitudes.

Mathematics absolutely does not require constant relations between variables. Many mathematical functions do not have constant relations between variables – the relationships can depend on any number of other variables. Time is a common dependent variable but many others exist, depending on the application.

- – - – - -
These two basic misconceptions prevent you from realizing that mathematics is a very useful tool indeed for understanding situations with multiple interdependent unknown variables. You have undermined your credibility badly with your frequent repetition of these fundamental errors. Your criticism of those abusing mathematics to claim improper numerical certainty in economics would be MUCH more effective if you’d stop saying obviously wrong things about mathematics.

DG Lesvic August 10, 2011 at 7:08 pm

Dave,

First I want to thank you for your forceful but civil argument, a rare pleasure around here.

You wrote,

“Mathematics absolutely does not require actual numbers – it does not require the ability to calculate a numerical result. The fact that a quantitative relationship exists between variables is not dependent on knowing their exact numerical values. Such a relationship can be expressed mathematically, and such an expression can be very useful for illustrating proportionalities and dependencies. None of this requires actual numbers and all of it is mathematics.”

It is the theory but not the practice of mathematics. And while the theory and formulas may be expressed without any actual numbers, they cannot be applied without them. You cannot solve an actual problem without actual numbers. You cannot count without countable elements, and counting, directly or indirectly, is the specific function of mathematics.

If not, what is, what separates it from non-mathematics?

You wrote,

“Mathematics absolutely does not require constant relations between variables”

The question is not what mathematics but economics requires

You continued:

“Many mathematical functions do not have constant relations between variables.”

That’s why they’re irrelevant to economics, which is concerned only with constant relations and explicitly eliminates variables, always analyzing but a single factor of change under the assumption that all other things remain equal.

yet another Dave August 10, 2011 at 8:50 pm

DG, In spite of the occasional lapse I do try to stay civil here at the Cafe.

It is the theory but not the practice of mathematics. And while the theory and formulas may be expressed without any actual numbers, they cannot be applied without them.

This statement is simply wrong. Mathematics is mathematics – separating it into “theory” and “practice” components makes no sense. Many mathematical applications do not involve solving for numerical answers. Again – this is a fundamental error in your understanding.

That’s why they’re irrelevant to economics, which is concerned only with constant relations and explicitly eliminates variables…
My comment you reacted to here was in response to a previous post on another thread where you said ”Mathematical laws and formulas necessrilly [sic] imply constant relations between magnitudes.” I may have added confusion by using the term variables rather than magnitudes in my response, so here’s another try:
Mathematics absolutely does not require constant relations between magnitudes. Many mathematical functions do not have constant relations between the magnitudes of the things in the function – the relationships can depend on any number of other variables. Time is a common dependent variable but many others exist, depending on the application. Having said that, many mathematical functions DO have constant relations between magnitudes. Mathematics is not nearly as limited or limiting as you imagine.

Another apparent misunderstanding I notice: You appear to also not understand the term “variables” in the context of mathematics. It is a general term that does not necessarily imply things are changing. A variable can be anything, including a constant, and its magnitude may or may not be known – mathematics can handle either case.

DG Lesvic August 10, 2011 at 11:53 pm

Dave,

You wrote:

“Many mathematical applications do not involve solving for numerical answers.”

Then what makes them mathematical? What is the difference between mathematical and non-mathematical problems, if not between quantitative and non-quantitative problems?

You keep referring to variables within the world as though they were within mathematics. They can’t be. Two and two is always four, never five or six.

It is precisely the uniformity of reason, and of its sub-divisions, mathematics, logic, and praxeology, that defines them as such, and enables man possessed of them to wrest order out of a chaotic universe.

Without that uniformity, they would not be reason, mathematics, logic, or praxeology, and, being as chaotic as the rest of the universe, a part of the problem, not the solution.

The fact that you and I can carry on this conversation is proof of the uniformity of reason, and that competent mathematicians can arrive at the same answers of the uniformity of mathematics.

Chaos is the problem, not the solution.

Mathematics can be of assistance to us in bringing order out of a chaotic universe only so far as it is not itself chaotic.

yet another Dave August 11, 2011 at 10:21 am

DG – we are drilling deeper into your misunderstanding of mathematical concepts.

First, I’m using the term “variable” as it’s used in mathematics. Based on your response I think you do not understand the meaning of the term in that context. Here’s something from wikipedia that might help:

Varying, in the context of mathematical variables, does not mean change in the course of time, but rather dependence on the context in which the variable is used. This can be the immediate context of the expression in which the variable occurs, as in the case of summation variables or variables that designate the argument of a function being defined. The context can also be larger, for instance when a variable is used to designate a value occurring in a hypothesis of the discussion at hand. In some cases nothing varies at all, and alternative names can be used instead of “variable”: a parameter is a value that is fixed in the statement of the problem being studied (although its value may not be explicitly known), an unknown is a variable that is introduced to stand for a constant value that is not initially known, but which may become known by solving some equation(s) for it, and an indeterminate is a symbol that need not stand for anything else but is an abstract value in itself. In all these cases the term “variable” is often still used because the rules for the manipulation of these symbols are the same…

I would modify the first sentence to this: Varying, in the context of mathematical variables, does not necessarily mean change in the course of time, but rather dependence on the context in which the variable is used.” Since the context can be time variance, even though it may be something else.

When you say this:

Then what makes them mathematical? What is the difference between mathematical and non-mathematical problems, if not between quantitative and non-quantitative problems?
You keep referring to variables within the world as though they were within mathematics. They can’t be. Two and two is always four, never five or six.

You reveal an additional misconception beyond not understanding the term variable. You appear to believe “quantitative” and “numerical” are the same thing. They’re not. Quantitative =/= numerical!

Many variables within the world are quantitative even though we cannot identify a numerical value for them (price, demand, supply, utility, etc. are all quantitative variables). Sometimes the numerical value of a variable depends on other factors which also cannot be known numerically. That’s OK – you don’t have to have numbers for mathematics to be useful.

For a particular situation, if and only if we know the numerical values of enough of the variables, we can calculate numerical values for the rest. The problem in economics is we don’t know the numerical values for enough (I would say most) of the variables. So you’re right when you say mathematical formulas cannot predict this or that numerical value, but you’re wrong when you think that’s the limit of mathematical analysis. Higher mathematics is perfectly applicable to situations with quantitative variables whose numerical values are not (or can’t be) known.

DG Lesvic August 11, 2011 at 11:21 am

Dave,

Can two and two ever be anything but four?

yet another Dave August 11, 2011 at 11:44 am

Can two and two ever be anything but four?

What does that have to do with our discussion?

[Hint: the correct answer is "nothing".]

DG Lesvic August 11, 2011 at 12:32 pm

Dave,

Take the formula two plus two equals x.

If x is always four, isn’t the formula a constant?

If x could be four, five, or six, isn’t it a variable?

Prediction: you won’t give me any simple or yes or no answers but just the usual smoke and mirrors.

yet another Dave August 11, 2011 at 5:44 pm

Take the formula two plus two equals x.

OK, but that’s kindergarten arithmetic, not the kind of formula I’ve been talking about. If you want a totally basic simple formula, why not choose something like the simple line equation y = mx + b for your example?
Since you didn’t, we have the equation x = 2 + 2

If x is always four, isn’t the formula a constant?

Your term usage is sloppy here – it doesn’t really make sense to say the formula is a constant. In this formula x is always four, so x is a constant. The Wikipedia info I copied earlier described the situation of using this x in another equation.

If x could be four, five, or six, isn’t it a variable?

In the equation x = 2 + 2, x is a variable. The fact that its numerical value is constant does not change the language of mathematics. Note this sentence from the Wikipedia reference I copied earlier:

In all these cases the term “variable” is often still used because the rules for the manipulation of these symbols are the same…

As to your prediction, the reason you think I’m using smoke and mirrors is that I’m explaining things that you do not understand and you’re unwilling to even consider the possibility that you don’t understand mathematics (even as you continue to prove your ignorance beyond a shadow of a doubt). The strangeness of your mathematical misconceptions is exceeded only by your dogged determination to cling to them.

Consider this:
In the line equation (y = mx + b), m is the slope of the line and b is the y-intercept. For a given line, m and b are constants and you can solve for a numerical value of y for any given x and draw the line on a graph. However, you could draw a line with unlabeled x and y axes and still be able to discuss the slope and y-intercept even though you have no idea of their numerical values. You could go further and show on the graph what happens when m and/or b change, again without ever having numerical values. In this way, mathematics can help illustrate phenomena clearly without ever having any numerical values involved.

Or consider the equation of exchange (MV = PQ). From this equation it’s immediately obvious that an increase in the amount of money (M) causes an increase in the price level (P) if the other variables are held constant, but you can also appreciate the effect of the velocity of money (V). You don’t need any numerical values to see this. For somebody who understands simple algebra the implications are immediately clear and obvious, so it’s a very elegant way to convey the information. To say the same thing in words would take longer and potentially be less clear.

DG Lesvic August 11, 2011 at 7:23 pm

Dave,

In the equation, two plus two equals four, it isn’t just the four that is the constant. The whole equation is the constant. And that’s all that mathematics can ever be, constants. That’s all science can ever be, and all reason can ever be. For that is what defines and separates them from non-mathematics, non-science, and non-reason.

Science is the rational, objective, universally valid knowledge of what is constant and orderly amidst the variables and chaos of the universe. It is precisely uniformity that defines science and variability non-science, and separates them.

As I said before, you are confusing the theory and formulas of mathematics with their application. While the theory is logical, or “qualitative,” and the formulas literary or symbolic, their end results must be quantitative. For what other than quantification defines mathematics and separates it from non-mathematics?

I have asked you that question before. Rather than keep going around the same old mulberry tree, why not answer it?

yet another Dave August 11, 2011 at 8:38 pm

Facepalm!

As I said before, you are confusing the theory and formulas of mathematics with their application. While the theory is logical, or “qualitative,” and the formulas literary or symbolic, their end results must be quantitative. For what other than quantification defines mathematics and separates it from non-mathematics?

Yes you’ve said that before. You were wrong then and you’re still wrong. The theory, formulas and applications of mathematics are all quantitative and all logical. Your conclusion follows from ignorance and is wrong. Your vehement crusade to reduce all of mathematics to arithmetic doesn’t change the fact that you’re wrong. Your religious fervor and need to be right in your heavily invested belief that mathematics is simply an “abridged form of counting” doesn’t change the fact that you’re wrong. The reason you’re wrong is obvious – you have several fundamental misconceptions about mathematics that you cling to as if your life depends on it. I have revealed to you the ones I’ve noticed only to see you steadfastly refuse to even consider the possibility you could be wrong. You simply repeat the same things over and over like the Rain Man.

One final try at correcting what might be your most fundamental underlying error:
Quantitative =/= numerical
(NOTE: the symbol “=/=” means “does not equal”)

In other words, just because something is quantitative does not mean its only use or application involves numbers. Mathematics deals with relationships between quantitative things and expresses these relationships with equations. The equations can be applied without ever using numbers. Mathematics is not anywhere near as limited or limiting as you believe.

When you say “an increase in price causes a decrease in demand” you are expressing the mathematical concept of inverse proportionality in words. The expression (D = k / P) says the exact thing far more succinctly. You need not know any numerical values for D, k or P to understand the equation. You don’t have to solve for a number to apply the equation.

That’s it – I’m done. I gave it a whirl because the basis for your misconceptions became obvious. It didn’t work. I fully expect you to continue believing the nonsense you’ve expressed ad nauseam here at the Café – I doubt you’ll surprise me.

DG Lesvic August 11, 2011 at 8:55 pm

Dave,

You wrote,

“When you say ‘an increase in price causes a decrease in demand’ you are expressing the mathematical concept of inverse proportionality in words.”

What makes it mathematical rather than “logical?”

What defines mathematics and separates it from non-mathematics? That is still the unanswered question.

DG Lesvic August 12, 2011 at 6:43 am

Dave,

Here’s another definition of science:

Science is the systematic classification of objective knowledge, and primarily the separation of constants from variables and order from chaos; and, their confusion and conflation, the displacement of science by anti-rationalism and nihilism.

Until you differentiate between mathematics and non-mathematics, and stop lumping everything from constants to variables into a single category of thought, you are simply dismantling science.

Economic Freedom August 9, 2011 at 3:56 pm

Keynes’s lack of knowledge of economics was also cited by Hayek in a videotaped interview with Leo Rosten from the mid-1970s (available online). He claimed that Keynes had studied economics under Marshall, but outside of that, seemed to know nothing of the innovations in the field from the rest of continental Europe (meaning, I suppose, the Austrian school?). But Hayek, too, praised Keynes’s intellect and wit.

As we might say today: Even if he didn’t know that much, Keynes could talk a good economics, and could shmooze with the best of them.

DG Lesvic August 12, 2011 at 1:09 pm

And Yet Another Definition:

Science is the systematic classification of objective knowledge, of theoretical knowledge, the separation of constants from variables; and, their confusion, chaos.

And that’s what you’re creating, Dave, chaos.

DG Lesvic August 12, 2011 at 2:32 pm

And Yet Another Mathematical Economist goes down in flames.

DG Lesvic August 12, 2011 at 9:15 pm

And yet another definition:

Science is the systematic classification of knowledge, separating the objective from the subjective, the constant from the variable, the necessary from the accidental, the universal from the environmental, the eternal from the ephemeral.

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