Obsticles to Recovery: Marxism and Keynesianism

[20000miles]

Still waiting for a definition of rational...

[feargach]

Still waiting for a definition of rational...

Give me your definition and I'll tell you if I disagree with it.

Figured out how to click on a link yet, or do you no longer care about Ariely's work now that you know he's one of a legion of economists who demonstrate that Mises was talking through his hat?

[20000miles]

Austrian economists tend not to use "rational" in their analysis. It sounds like a vlaue judgement to me. Austrians do however argue that humans will try to satisfy the end they value most highly frist, and subsequently ranked ends in order. So if we were mindreaders and discovered a man's value scale looked like this:

(First) 1. Continuing to watch the baseball game
(Second) 2. Going for a drive
(Third) 3. Playing bridge

we would presume he would continue to watch baseball, as it is ex ante the end that gives him the most utility (ie. it is ranked highest on his value scale). Note that an actor clearly may err in his decision, and ex post think that he had miscalculated.

Rational: action aimed at satisfying the ranked subjective ends one ex ante beleives will give the actor satisfaction.

[JollyRedGiant]

1920-21 recession, where the government followed a pretty "do nothing approach". Weak labour unions were also the norm. Wage rates fell 16% in a year.

You see - there you go again - trying to sound all intellectual and then making a stupid post like this one.

1920-1921 was a period of revolutionary upheaval in practically every country of the world - some nationalistic in nature but many socialist in nature (including Ireland where nationalists were terrified of the growth of the left at this time). Labour unions of this time were well organised - radical - based on socialist principles and hell-bent on changing society. And the USA saw the development of one of the most powerful workers movements the world has ever seen. The emergence of fascism during this period (including in Ireland with the Farmers Freedom Force) was the response of capitalism to attmept to defeat the workers movements. The ruling class threw off any pretence of democracy and, using fascism, adopted an attitude of naked agression in an attempt to destroy the organisations of workers. The wage falls that you indicate did not occur because of weak unions but because of defeat of the left in open class conflict between the bourgeoisie and the workers.

[feargach]

Austrian economists tend not to use "rational" in their analysis. It sounds like a vlaue judgement to me. Austrians do however argue that humans will try to satisfy the end they value most highly frist, and subsequently ranked ends in order. So if we were mindreaders and discovered a man's value scale looked like this:

(First) 1. Continuing to watch the baseball game
(Second) 2. Going for a drive
(Third) 3. Playing bridge

we would presume he would continue to watch baseball, as it is ex ante the end that gives him the most utility (ie. it is ranked highest on his value scale). Note that an actor clearly may err in his decision, and ex post think that he had miscalculated.

Rational: action aimed at satisfying the ranked subjective ends one ex ante beleives will give the actor satisfaction.

That does not sound like an assessment of human rationality that would be useful in justifying any kind of theory of how humans will behave economically. I.E: it's not even economics.

[20000miles]

That does not sound like an assessment of human rationality that would be useful in justifying any kind of theory of how humans will behave economically. I.E: it's not even economics.

You are a riot.

It's a discussion of how actors will allocate scarce resources to achieve valued ends. It's the heart of economics.

[20000miles]

You see - there you go again - trying to sound all intellectual and then making a stupid post like this one.

1920-1921 was a period of revolutionary upheaval in practically every country of the world - some nationalistic in nature but many socialist in nature (including Ireland where nationalists were terrified of the growth of the left at this time). Labour unions of this time were well organised - radical - based on socialist principles and hell-bent on changing society. And the USA saw the development of one of the most powerful workers movements the world has ever seen. The emergence of fascism during this period (including in Ireland with the Farmers Freedom Force) was the response of capitalism to attmept to defeat the workers movements. The ruling class threw off any pretence of democracy and, using fascism, adopted an attitude of naked agression in an attempt to destroy the organisations of workers. The wage falls that you indicate did not occur because of weak unions but because of defeat of the left in open class conflict between the bourgeoisie and the workers.

1920-21 was also a period of recession caused by inflation used to fight the war. Now had there been strong unions, government interventions in the labour market and high unemployment benefits, then mass unemployment would have surely ensued. As such the recession ended within 2 years. The same cannot be said of the Great Depression, where fascism was actively implemented in the United States, and labour was managed under federally-supervised cartels.

[feargach]

You are a riot.

It's a discussion of how actors will allocate scarce resources to achieve valued ends. It's the heart of economics.

But it's full of caveats and get-out clauses.

It indicates nothing of whether a person's uninfluenced decisions will tend to lead to optimal or sub-optimal profits or not.

[20000miles]

So do you disagree with my definition or not? Care do offer another one?

Rational: action aimed at satisfying the ranked subjective ends one ex ante beleives will give the actor satisfaction.

I might add that values are constantly changing and different between humans.

[feargach]

I might add that values are constantly changing and different between humans.

So sometimes people want optimal profits, and sometimes they prefer lower ones?