A Beginner’s Guide to Austrian Economics

Posted by Kittyhawk 9 years, 4 months ago to Economics
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From the article:

The “Austrian School” of economics grew out of the work of the late 19th and 20th century Vienna economists Carl Menger, Eugen von Bohm-Bawerk, Ludwig von Mises, and Friedrich Hayek (though of course Austrian School economists need not hail from Austria). Austrians focus strongly on the analysis of individual human action. This is known as praxeology, the study of the logical implications of the fact that individuals act with purpose, from which all economic theory can be deduced. Austrians also note the correlation between greater economic freedom and greater political and moral freedom. This in part explains why Austrian economics is the intellectual foundation for libertarianism. Austrians rightly attribute the repeated implosions of mainstream Keynesian economics to the latter’s focus on empirical observations, mathematical models, and statistical analysis.


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  • Posted by EskimoBro 9 years, 4 months ago
    In order to believe that exact concurrence of invention is virtually impossible, you have to assume two things.
    1. That only one person at a time in the entire world can be thinking of the same solution to a problem at any given point in time.
    2. That inventions happen instantaneously.
    If you can’t agree with these two points then your point is nonsense. And quite honestly it would be pretty absurd to believe that these two would be true because history has shown that more than one person in the world can have the same solution to the same problem.
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  • Posted by $ blarman 9 years, 4 months ago in reply to this comment.
    Incorrect - see my quibbles below. An abacus is an aid only, it actually performs no calculations. The beads don't move themselves, they just allow a human to track the steps of a computation as an aid in coming to a final answer. The same applies to a slide rule.
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  • Posted by khalling 9 years, 4 months ago in reply to this comment.
    wait a minute. eskimo, you are the new one here. I re-read the thread, every question you asked was answered. Perhaps you need to be more specific. btw, patent attorneys are not litigators. They are first engineers. Then they got a law degree. They are about creating not about tearing productivity down.
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  • Posted by $ blarman 9 years, 4 months ago in reply to this comment.
    Even shift registers are logical instruments. Everything a computer does is based on one of a series of basic functions called gates, and a shift register is just a series of "NOT" gates and transistors. Most logic is based on two inputs turning into a single output.

    Here's a quick list of the more common ones (the XNOR and EOR are REALLY situational):

    NOT - inverts input: 0 becomes 1, 1 becomes 0
    OR - when either input is true, output is true: 0 + 1 = 1, 1 + 0 = 1, 0 + 0 = 0, 1 + 1 = 1
    NOR (~OR) - when either input is false, output is false: 0 + 1 = 0, 1 + 0 = 0, 0 + 0 = 0, 1 + 1 = 1
    XOR (eXclusive OR) - only when one of the two inputs is true is the output true: 1 + 0 = 1, 0 + 1 = 1, 1 + 1 = 0, 0 + 0 = 0
    AND - when both inputs are true, output is true: 0 + 1 = 0, 1 + 0 = 0, 1 + 1 = 1, 0 + 0 = 0
    NAND (~AND) - when both inputs are false, output is false: 0 + 1 = 1, 1 + 0 = 1, 1 + 1 = 1, 0 + 0 = 0

    http://en.wikipedia.org/wiki/Logic_gate
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  • Posted by dbhalling 9 years, 4 months ago in reply to this comment.
    That is not exact that is nearly the same time and in this case you may be talking about 100 years. Your point is nonsense.
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    • EskimoBro replied 9 years, 4 months ago
  • Posted by khalling 9 years, 4 months ago in reply to this comment.
    I'd like to know more about that. It is my understanding that this was the crux to selling the concept. no one saw the value in a personal computing device. They literally were selling it as Rolodex for recipes in the kitchen
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  • Posted by EskimoBro 9 years, 4 months ago in reply to this comment.
    How about spears, bow and arrows, boats, and musical instruments? These are some of the inventions that were made by different people and are found across all types of ancient civilizations in which never had contact with each other. Same inventions, different inventors.

    Were they made at the exact time? That's hard to say but I would argue that if they can be made independently without knowing of its current existence in the first place then yes it would be possible.

    With the acceleration of new innovations happening today and all of the information of world at everyone's finger tips, I would say it would be even more possible now than ever before.
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  • Posted by $ blarman 9 years, 4 months ago in reply to this comment.
    Both a slide rule and an abacus function on a Base 10 system, where any digital system functions on a Base 2 system. That would be the primary difference in logic. That's why I commented that I'd love to see someone define an "analog" system of logic. Analog systems deal in ranges. Are there "degrees" of truth? ;) Verbal communications can be considered a basic analog system - especially when you start looking at languages based on intonation such as Chinese, Korean, etc. But how you'd incorporate that into a mechanized system (or what problems you would need to potentially solve with it) I have no idea.

    Have you ever tried doing math in Base 8 (octal) or Base 16 (hex)? Talk about a complete mind shift. Same thing applies with binary/digital logic - it requires its own rules and computational constructs. Babbage's engine was really only a physical construct that used binary logic. The genius was in not only outlining the rules for the binary logic structure, but incorporating them into a physical manifestation/invention that proved the concept.
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  • Posted by $ blarman 9 years, 4 months ago in reply to this comment.
    "just because a person has a degree in a specific field doesn't automatically mean they're an expert and know more than anyone outside of that field."

    A degree establishes that the person has a verified level of competence in that topic that is of notable difference from the common man. Does this exclude other individuals from enlightening themselves? Of course not. But let's be realistic - that is the exception rather than the norm and should be treated as such.

    For me, a computer must be a device able to take an input and generate an output autonomously. It can't be an "aid". That was why Babbage's engine was so revolutionary. The engine was set up (programmed) to accept an input, process it, and generate an output, but was not reliant on the person to provide the processing power. That's the differentiation I would make. If you set up Babbage's engine to a crankshaft powered by a diesel engine, it could operate without human interference consistently and without error while still churning out useful (and variable) results. Take a human out of the pairing with either abacus or slide rule and there is no similar utility.

    And BTW - my dad showed me how to use a slide rule one time, and you're not missing out on anything - as long as we still have power. In the event of a global EMP, I may just have to ask him to break it out again for me...
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  • Posted by dbhalling 9 years, 4 months ago in reply to this comment.
    No it is not the same thing. This ignores the hard work and problems that had to be solved. Let's see if you can actually do some research and find out what those problems were.

    This is exactly the sort of nonsense that suggests that no mechanical invention should obtain a patent because they are all made from the 8 simple machines.
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  • Posted by Robbie53024 9 years, 4 months ago in reply to this comment.
    To Coca Cola please add McDonalds, Sears, FedEx, and Facebook. All of which employ specific technologies that are protected, but the fundamental business model is replicable by anyone, yet many try and do not succeed in copying.
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  • Posted by Robbie53024 9 years, 4 months ago in reply to this comment.
    You are correct, some are purely accidental. Most of the time that this occurs, it was in the search for some other productivity enhancing innovation.
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  • Posted by Robbie53024 9 years, 4 months ago in reply to this comment.
    The maser (precursor to the visible light laser) was in fact created to increase productivity - the productivity of exploring space. A student of the inventors further innovated on their invention and extended it to the visible spectrum. Since it is the same technology, merely using a different wavelength of radiation, should the student have even received a patent? This was in fact a foreseeable extension of the inventors of the maser (in fact they stated so in their papers).
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  • Posted by khalling 9 years, 4 months ago in reply to this comment.
    exact concurrence of invention is virtually impossible. Regardless it is a legal discussion, not an ethical discussion.
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  • Posted by Robbie53024 9 years, 4 months ago in reply to this comment.
    Even entertainment is "productivity." It provides more gratification than other forms, therefore displacing those others.
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  • -1
    Posted by Robbie53024 9 years, 4 months ago in reply to this comment.
    What db is never able to provide an answer to is independent people coming up with the same idea without knowledge of one another. He insists that the first individual is the only owner. This is irrational based on his own premise that he owns himself and by derivation owns the fruit of his own mind.
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  • Posted by dbhalling 9 years, 4 months ago in reply to this comment.
    Interesting question. I think blarman is talking about being built directly on the rules of logic - and and or statements. Of course digital computers have many functions that are not just logic statements, such as shift registers.

    Clearly logic is used to design slide rules and analog computers but does not use AND and OR statements.
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  • Posted by Robbie53024 9 years, 4 months ago in reply to this comment.
    Huh? The computer (all derivations of same) was created to "compute" faster - thus increasing the number of calculations per unit of time, the definition of productivity.
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  • Posted by dbhalling 9 years, 4 months ago in reply to this comment.
    No you mis-characterized what I said. You cannot say inventions are about increases in productivity and suggest the two are the same. You cannot say that inventions will happen because there is a profit motive for them. The historical evidence is that without property rights then there is no profit motive or any other motive for inventions that would create our modern world
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  • Posted by Robbie53024 9 years, 4 months ago in reply to this comment.
    So true. Smith and Hayek understood that a system free of overt control will naturally regulate itself. This is due to the function of prices and profits. Prices point the way to allocation of resources, and profits are the mechanism for innovation.
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