Friday, April 1, 2016

Austrian Economics Research Conference

The Austrian Economics Research Conference is in full swing and already the attendees have been treated by keynote lectures by Paul Gottried, David Cowan, and Bruce Yandle.

I was blessed to be part of a History of Economic Thought Session, at which I presented the paper, "Austrian Economics as the Solution for Economic Development Theory." The abstract for the paper is as follows:

Two conflicting theories of economic development developed during the Twentieth Century following the proliferation of Keynesianism. A direct descendent of Keynesian theory, the Harrod-Domar model fueled so-called capital fundamentalism—the doctrine that capital alone was the determinate of economic growth. The Solow growth model and subsequent empirical studies drawing on that model asserted contrarily that capital accumulation was an insignificant contributor to economic expansion, but that technology was the driver of continued prosperity. Both frameworks rely on mathematical models and, hence, suffer from problems of aggregation as well as the serious limitations of rarifying assumptions. Much unproductive debate could have been avoided if economic analysis by Ludwig von Mises and other Austrians had been more fully understood and assimilated into the larger body of economic development literature. Austrian capital theory and Mises’ conception of capital as a tool of economic calculation, not merely an aggregate of homogenous physical goods reveals the important relationship between saving and investment in capital accumulation and wise entrepreneurship within the market division of labor as distinct, yet interrelated engines of prosperity. Such a link also helps to resolve the true relationship between capital and technology as sources of economic progress.

Tomorrow we will be treated to the Mises Memorial lecture given by my friend and Department Chair Jefferey M. Herbener.

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