Is Austrian Economics Pseudo-Science?

Razib of gnxp thinks so:

The “grasped a priori” part has really bothered me. I mean, I read psychology and history, I can’t derive it a priori. Recently I was going over some issues in modern Middle Eastern history, and learned that King Hussein of Jordan had apparently asked Israel for permission to send a brigade to Syria to invade the Jewish state during the 1973 Yom Kippur War. Honestly, I really don’t know if I could ever grasp Arab psychology a priori. The more and more I read about psychology the more I think that anyone who believes that they could develop an axiomatic system of human action from insights they grasped a priori is totally retarded (mad props to Aristotle though, he worked before the cognitive revolution)…

My readings in psychology and history makes it very difficult for me to understand how anyone could adhere to a Misesian form of Austrianism with its commitment to praxeology. In short, I really think praxeology is a rotten foundation for any system of thought.

I don’t care for the personal attacks in Razib’s original post, but he raises a good question: considering how bad we are at introspection, why should we trust introspection to build an economic order?

Anyone from Chicago Boyz care to answer?

8 thoughts on “Is Austrian Economics Pseudo-Science?”

  1. No economic school is science; economics is an art, as well as investing. If you just use metrics, you get LTCM.
    The Austrian school is the one most concerned with freedom, so its my choice.

  2. Mark,

    I don't see why we have to dismiss quantitative analysis (economic or otherwise) as long as we retain some sort of Hayekian perspective of our own shortcomings …

  3. The fact is that Austrian economics is more like a practice of Aristotelian philosophy (starting from axioms) than quantitative economic systems of the Chicago, Neoclassical, and Keynesian schools.

    The answer to the question about whether Austrian economics is “pseudo-science” is “no”; the fact that Austrian economics bears no even slight similarity to science is its greatest strength. Economics today, like other social sciences, is attempting to reduce itself to formalistic mathematical methods.

    Austrian economics counters this movement quite brilliantly.

  4. Brock,

    Well said. I think it’s better to call Austrian Economics a philosophy than a science.

    As such, it has limited use in our attempt to better control human behavior, but it can raise interesting questions and problems.

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