What’s the difference between Keynesian economics and Austrian economics?
THE DIFFERENCE BETWEEN KEYNESIAN AND AUSTRIAN ECONOMICS
(updated with minor edits)
There are three basic movements in economics. We unfortunately name them by their origins rather than their goals
Austrian economics seeks to eliminate asymmetries of information so that people can cooperate more effectively. In this sense Austrian economics is an attempt to create a social science of cooperative institutions – political economy. More importantly the objective is to improve information. It is also the most eugenic system. (nAustrian Econ = Social Science / Political Economy )
Chicago/freshwater/monetarist economics seeks to create formula for the non discretionary interference in the economy to correct against shocks, and thereby adding the economy to our existing tradition of rule of law. The information distortion then is not open to discretion and manipulation, and people are not made victims of Human error and bias. This system retains eugenic reproduction and savings and intervene rational lending but allows the public to insure itself agains shocks. It also prevents the creation and export of risk by one generation into another. (Chicago Econ = Monetary Rule of Law )
Keynesian /left/freshwater economics seeks to increase consumption and therefore employment by the constant adjustment of the economy using policy and discretion as is done under the Continental system of law. This system seeks the maximum distortions possible and the maximum redistribution possible. It is also the most dysgenic system. It has destroyed the system of intergenerational rational lending, and has led to the export of risk. (Keynesian/Ashkenazi Econ = Discretionary Rule)
In a perfect world,
1) We develop all institutions under Austrian Economics, by minimizing asymmetries of information through constant investment in those institutions that assist in information.
2) We use Chicago economics in our struggle to define a measure by which we limit artificial shortages in the money supply, and regulate the money supply so that we never incur ‘real’ shortages.
3) We use Keynesian discretionary fiscal policy to cheaply invest in infrastructure in times where that investment is cheapest.
4) We keep a balance sheet of all forms of capital from genetic through informational, as a means of measuring whether we are burning accumulated capital of any kind, or whether we are actually producing and adding to capital. This is the reason for the conflict in economic policy: we aren’t tracking changes in capital, only velocity.
I am happy to debate this issue with any economist or philosopher living. But I seriously don’t think that anyone with the knowledge to conduct that debate would do so.