If you only read one essay today…
…make it Why I Am Not an Austrian Economist, by Bryan Caplan.
I used to have a half-interest in Austrian Economics. The idea that utility is unquantifiable always made me slightly uncomfortable with the seemingly-quantified way in which neoclassical microeconomics uses it. It had not occurred to me that whilst the simple charts and graphs we use imply ordinality they don’t necessarily imply cardinality. This made me feel a whole lot better. Utility functions are cool again!
There are other principles that are soundly destroyed in that piece (how Austrians address continuity etc.) that I hadn’t really considered (perhaps that’s a signal that I should be thinking more critically about what’s being taught to me?). In any case, it’s a good read if you want a perspective on some aspects of Austrian economics, and how they differ (or surprisingly, don’t differ) from neoclassical microeconomics.
In: business · Tagged with: austrian economics, economics, essay, microeconomics