Yes, I was refering to the Boulding article you mention -- perhaps we read
it differently.

Second, I think there are several reasons why Austrians have
difficulities --- some self-induced, others as a consequence of other
issues.  Public choice scholars should realize that for a long period of
time, public choice scholars were wedded out of the process --- consider the
situation at UVA --- as well.  Memory shouldn't be so short. Gordon Tullock
published a book a few years ago made up of his rejected pieces --- as he
has said on more than one occassion, his original rent seeking piece took
for ever to get published and when it did it was in the Western Economic
Journal -- not exactly a hotbed of prestige.  So fads and fashions are
cyclical.  Austrian arguments at one time were more widely accepted -- say
in the 1930s, and they have been resurrected a bit in the 1980s with the
collapse of socialism.  As one indicator, look at the articles in the JEL
that address Austrian arguments since the mid-1980s --- Kornai's piece on
reform in Hungry, Heilbroner's piece on modern economic thought, White and
Selgin on Free Banking, Caldwell on Hayek, and Kirzner on the Austrian
theory, and even this past year the paper by Ostroy on the market and
creative competition.  So by that representation, the claim that Austrians
have been shut down in the professional discourse is dubious.  No doubt a
certain style of Austrianism has been shut down, but for good reasons
largely.  Nevertheless, it is true that Austrians have a difficult time
getting a hearing and that is because: (a) they reject the standard language
of economics and its method --- along with McCloskey Austrians have long
argued that statistical significance and economic significance are not the
same thing (making neither one very popular); and (b) they tend to focus
their attention on "big" think questions which few scholars are really
capable of doing anything with --- the fact that a Hayek or Mises, or a
Buchanan or a Sen, or an Adam Smith, can tackle the "big" ideological
questions doesn't mean that people who read them can do so in a progressive
research program fashion. Thus, many individuals attracted to Austrian
economics attempt to tackle questions which they cannot really address given
their talents and experience.  We would do better if people took smaller
projects and did them in a serious manner --- I would opt here for more
economic history being written by Austrian inspired folk, and more detailed
institutional analysis in the policy work.

Third, the market for economic ideas is not a market in the same way that
the market for computer software is.  This is an empirical claim on my part,
and the reasons I would give is that in academic life (following Bryan
Caplan) people don't have to pay for holding rather silly ideas.  Paul
Krugman, who by any measure is a more successful economist than any free
market guy currently working in the academy, wrote after September 11th that
the attack might actually be good for the US economy.  OK -- so much for
good economics winning the day.  Krugman has taught where? --- MIT,
Stanford, Princeton, and he has won what? --- the JB Clark Award.  OK ---
Joseph Stiglitz is the most important theorist of his generation (something
I actually think he deserves credit for), but nevertheless, he has argued
that the minimum wage does not present a problem (actually he argued that in
his position as a politician while in his textbook he presents the standard
argument), but he did seriously argue that capital controls would solve the
world financial problems.  He has taught where?  Yale, Princeton, Stanford,
Columbia.  He has won what?  JB Clark, and Nobel.

Do you really think that Mancur Olson, Gordon Tullock, James Buchanan,
Ronald Coase, etc. have had the sort of academic prestige throughout their
careers as say William Baumol?!  Of course not.  Olson was denied tenure and
had to leave academics before U of Maryland picked him up, Tullock, Buchanan
and Coase were basically forced out of UVA. Why? Because they were bad
economists?!  No, because of fads and fashions and the politics of prestige
within the academy.

So the Austrians, with the loss of the NYU program, no longer have a
presence at a major research university --- only GMU (and even there it is
diminshed from what it once was).  Does this mean the Austrians have somehow
failed the market test. Well, yes and no.  At the same time this has
happened, a stream of Austrian books have been produced -- some of which
have even gotten some pretty good recognition.  Articles by Austrian
scholars appear in journals all the time --- maybe not in the AER, but in
the professional journals.  Some Austrians even get some wide recognition
within the profession and Austrian arguments are recognized by leading
scholars as having some merit --- I am particularly thinking here of Andrei
Shleifer who in my opinion is doing the most interesting market-oriented
work in a major university these days.

Have Austrians missed opportunities --- definitely.  In my own case, I
failed to grasp opportunities to become a transition specialist that was
contributing to the top journals.  I had opportunities --- including a
Hoover fellowship, which is an absolutely great gig.  I tried to make the
most of that year, but I didn't have the full creative talents to make the
argument fly.  I made arguments that were published in lesser tier journals
(some of which have even been cited by others) that others were able to
develop further and publish in the top journals (for example Shleifer).
That is MY failure, not Austrian economics.  Larry White and George Selgin
didn't miss their opportunities.

On final point, the Austrians have often argued that ideology has played a
major role in their relative obscurity.  There is no doubt this was true
during the 1940s-1980s, but since 1980 free market ideas have not been
silenced within the profession. So I don't think the ideological argument is
true --- though of course the radical libertarianism of most Austrians is
suspect even among free market types. For example, when Austrians deny all
market failure problems -- no externalities --- they just eliminate
themselves from the conversation about how market institutions could arise
to solve these problems. So this is again an example where the isolationism
is self-imposed.

Economists as a group value "smarts" not necessarily being "good".
Cleverness wins over wisdom in the game we play.  Most of the type of
questions which attract the interest of Austrians do not lend themselves to
the type of "smart" and "clever" analysis that so often impresses our peers.
Instead, sticking to one's knitting and getting the details correct in a
solid piece of economic history, or demonstrating a sense of judgement and
wisdom on policy relevant issues seems to be more the hallmark of the best
within the Austrian approach.

BTW, none of this should be seen as a complaint on my part about the
relative position of the Austrians within our profession.  I think the
profession is very important and certainly do not think isolationism and
dogmaticism are viable options for progress.  I do think specialization is
something we economists value in every aspect of production except in our
own discpline which is sad and weird -- so I think schools should specialize
rather than follow blindly the fads and fashions of the leaders.  But these
are forces beyond an individuals control --- all any individual can try to
do is to do good work as they define it and try to write clearly and
forcefully to maximize their readership.  I just don't see all the whinning
that Austrians supposedly engage in.


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