Baffled by the Economy

Why being a macroeconomist means never having to say you're sorry

President Obama and his critics have a major disagreement. He says his accelerated economic stimulus efforts will create 600,000 jobs by the end of the summer. Senate Republican Leader Mitch McConnell of Kentucky, however, doubts "the spending binge we're on is going to produce much good." Both can't be right. But neither has to fear being proved wrong.

Why not? Because there is no persuasive way of determining the effect of implementing the president's policies. No matter what happens, each side can claim vindication.

If the economy improves and unemployment drops, Obama can take credit. If it fails to improve and unemployment rises, though, he can say he averted an even worse showing. Republicans will take the opposite tack—attributing any improvement to the natural resilience of the economy and blaming the administration if things get worse. And neither side will really know who's right.

I have long been a believer in the value of economics in understanding the world. But the chief effect of the current crisis is to raise the possibility that economists—at least those macroeconomists, who study the broad economy—don't have a blessed clue.

Take Princeton's Paul Krugman, the 2008 Nobel laureate. In February, he said the administration's stimulus plan was too small to be very effective. On March 31, he scorned talk of improvement in the economy: "So far, there's nothing pointing to a fundamental turnaround this year, or next, or for that matter as far as the eye can see." But this week, he said, "I would not be surprised if the official end of the U.S. recession ends up being, in retrospect, dated sometime this summer."

How we moved so quickly from "this solution won't work" and "no recovery in this decade" to "maybe it's already started" is one of those mysteries that may never be explained. And Krugman left himself plenty of wiggle room by not predicting the recession will end soon, but saying only that he "would not be surprised" if it does.

In any event, the sudden change of forecast will not damage his standing. Macroeconomists are expected to be smart, learned, and articulate in explaining and predicting the course of the economy. But these days, at least, no one really expects them to be right.

That includes them, I suspect. They realize that the economy is a big, complex organism about which they can make only educated guesses. They know there is no consensus in the profession on how to extricate ourselves from this mess.

Krugman exhibits great confidence in his own brainpower. But I doubt he would bet even 1 percent of his $1.4 million Nobel Prize award on his ability to predict the date this recession will end.

So why should we listen to what macroeconomists say? Some economists think that often we shouldn't. Russell Roberts, a scholar at George Mason University and the Hoover Institution, told me, "I think some of macro is useful—what causes inflation, for example. I just don't believe we're very good at testing theories at the macro level in a convincing way." Many times, he says, all macroeconomists can do is concoct stories that explain events after the fact.

Microeconomists, by contrast, make predictions about the effect of policies on individual markets, and those predictions are easier to confirm or refute. They virtually all agree, for example, that price controls lead to shortages, and governments occasionally take the trouble to prove them right.

But macroeconomists can almost always claim to be right, no matter what happens. If they recommend Policy X and the economy weakens, they can say it prevented a complete disaster. If they say Policy X will hurt and things improve, they can say without it, we'd be even better off. Being a macroeconomist means never having to say you're sorry.

That doesn't mean we should disregard what they say. As University of Chicago economist John Cochrane says, "If you want to know if you have cancer, you talk to a doctor, not a psychiatrist. If you're interested in macroeconomics, why would you not talk to people who spend their lives thinking about it, and writing about it, subject to the harsh discipline of peer-reviewed journals?" But he thinks they should admit the limits of their knowledge.

Right now, though, the limits loom large. The knowledge? Not so much.

COPYRIGHT 2009 CREATORS SYNDICATE, INC.

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  • ||

    God damned right, If they wanted to be wrong, they would have been traders.

  • ||

    ...and we'll still be under 20ft of debt.

    Not that that has any downsides.

  • ||

    http://www.youtube.com/watch?v=VVp8UGjECt4

    This is amusing. I hope the link works, my html is a bit rusty...

  • ||

    Damn.

  • Freddie||

    Seems to me that some of these macroeconomists are very well versed in "fed-speak". The government can't possibly make up for all of de-leveraging that has been taking place. So, what exactly is their motivation (the economists)? Listening to themselves talk? Sounds like another profession.

    thew83
    Can't show you here but go to

    Visit W3Schools! Scroll to "The href Attribute" Substitute URL and text to be diplayed.

  • ed||

    Being a Macroeconomist Means Never Having to Say You're Sorry...

    ...or, It's Easy to Bullshit Americans.

  • ||

    thew83
    Can't show you here but go to

    Visit W3Schools! Scroll to "The href Attribute" Substitute URL and text to be diplayed.


    Thank you.

  • Lester Hunt||

    One thing recent events have shown me is that I had drastically underestimated the extend to which macro is motivated by politics. "Stimulus" spending will go forward regardless of the facts because, fact is, it gets votes.

  • ||

    ROTFL, good ones dude, real good!

    RT
    www.privacy-tools.echoz.com

  • ||

    < jack > Has there been a Miranda-for-terror-suspects thread? I searched for "Miranda" on the main H&R page, but often the pithy headlines foil me.
    < / jack >

  • ||

    The government can't possibly make up for all of de-leveraging that has been taking place.

    Because of the AIG bailout, there has been a lot less deleveraging than people think. Enormous amounts of the leverage behind the credit bubble existed in the OTC derivatives market. That leverage hasn't gone away so much as it has been transferred from the private sector to the public sector.

  • Scarcity||

    "If you want to know if you have cancer, you talk to a doctor, not a psychiatrist."

    Perhaps the quoted scholar meant psychologist. A psychiatrist is an MD.

  • Scarcity||

    Not that I recommend seeing a psychiatrist if you think you have cancer.

  • creech||

    Hey, as long as pols are going to get away with making untestable claims, we might as well get Bill Redpath to claim that the mere presence of a Libertarian candidate for President on the ballot since 1972 has "saved" every job in America!

  • ||

    This article explains why I like Austrian economics.

    Austrian economics is the anti macro discipline.a
    It is explicitly against trying to model "an economy" to make it look like an engineering diagram.

    All macro is reduced to its micro roots. No aggregates, no econometric computer models, no inputs and outputs measured like a Rachel Ray recipe.

    Austrian economics is the study of individual human action.

  • Neu Mejican||

    libertree,

    Correct me if I am wrong here, but it sounds like you are saying that Austrian economics is, essentially, a collection of just-so stories that replaces study with proclamation.

  • Seward||

    Neu Mejican,

    The main argument that Hayek had with the modern mathematical modeling so prominent in economics after the 1930s was that it was essentially build on a model resembling 19th century physics. Ir is argued still today economics as a discipline is basically still in the throws of 19th century positivism. Which is just bizarre once one thinks about what Kuhn, Popper, etc. have said about science. Indeed, I think this basically means that economics isn't a science at all.

  • Seward||

    Neu Mejican,

    Anyway, libertytree is right in much as libertytree states that Austrian economics views the locus of study as properly with the individual.

  • Neu Mejican||

    Seward,
    Thanks for a serious response.

    The problem I have with that position is this...

    "properly with the individual"

    Understanding the individual does not shed light, necessarily, on the system in which that individual is embedded.

    I don't get a sense that reductionist approaches have made much progress in understanding the complexity of the economy.

  • Neu Mejican||

    In other words,

    A study of the individual and their behavior is "psychology" not economics.

    Attempting to reduce the system to the psychology of the individual doesn't get you very far.

    So is Austrian economics essentially Freudian economics?

  • bobbyjoe||

    "If you took all the economists in the world and lined them up end to end, they still wouldn't reach a conclusion."

  • Seward||

    Neu Mejican,

    Understanding the individual does not shed light, necessarily, on the system in which that individual is embedded.

    There is no institution or system; there is only the individuals that make it up. Or to borrow an example from someone else, the Congress is not an entity, it is made up of a bunch of discrete individuals pursuing their own individual wants, etc. Austrians don't assume that society, institutions, etc. have a personality; that is a moronic concept which 19th century sociologists thought up.

    As for psychology...

    No.

    The behavior of individuals in the marketplace; their interactions with one another. Now the "psychology" of groups ("animal spirits") is what Keynesians are all about.

    Anyway, there is no possible way I could encapsulate the field of Austrian economics in a few blog posts. One place to start would be the FEE lectures you can find on iTunes.

  • Seward||

    One thing that is cool about Austrian economics is that it is a field on the rise. It had a nadir from the 1930s to the 1960s and since Hayek won his Nobel it has had a renaissance.

  • Neu Mejican||

    Seward,

    There is no institution or system; there is only the individuals that make it up.

    There is no [brain, body, solar system]; there is on the [neurons, organ, objects] that make it up.

  • engineer||

    "So is Austrian economics essentially Freudian economics?"

    No,but that could be entertaining.

    Freudian economist:"The recession happened because we're all in love with our parents."

  • Neu Mejican||

    Seward,

    Clearly there are both systems and the elements that make up those systems. Understanding the elements is important, but denying the existence of the system because it is hard to understand is not a serious position, imho.

  • Neu Mejican||

    Austrians don't assume that society, institutions, etc. have a personality; that is a moronic concept which 19th century sociologists thought up.

    A strawman.

    You don't really think that is what the macroeconomists are modeling do you?

  • ||

    But macroeconomists can almost always claim to be right, no matter what happens.

    Similarly, any engineer can claim to be competent if that engineer's buildings never fall down and the engineer remains in good standing among his colleagues.

    Even if an engineer's building happens to collapse and kill thousands of people BECAUSE A 747 CRASHES INTO IT, that engineer will probably still get a pass from other engineers. This is despite the fact that planes have crashed into buildings at least as often as the US economy has had NBER-defined recessions.

    Macroeconomists should put more effort into admitting the limitations of their prognostications when giving advice, but people asking for advice should by default be skeptical of any human being's ability to predict the future.

  • engineer||

    "There is no institution or system"

    I'll have to call BS on that one. Emergent behaviors can occur in systems of discrete individuals. In an economy, panic and uncertainty can be self-reinforcing, as people avoid spending and investment that they would make in the absence of those factors (all other things being equal).

  • Neu Mejican||

    engineer...

    Beyond BS...

    It does, however, reinforce my original impression...

    Proclamations replace study...belief replaces understanding.

  • Seward||

    Neu Mejican,

    Actually, that is exactly how macro works.

    engineer,

    In an economy, panic and uncertainty can be self-reinforcing...

    Sure, but it is still individuals interacting with one another, not individuals interacting with some abstract thing called society.

  • engineer||

    Can't post quickly. keyboard screwed up.

    Not endorsing Obama policy. Plenty of proclamations replacing study there. And it's damn costly too.

  • Chris Martin||

    The Hayekian point on the inability of government to replicate the knowledge of the market is made in this Onion-style parody entitled "Obama Appoints Russian Mystic Rasputin "Psychic Economic Adviser to the Czars":

    http://optoons.blogspot.com/2009/06/obama-appoints-russian-mystic-rasputin.html

  • Seward||

    Neu Mejican,

    Clearly there are both systems and the elements that make up those systems. Understanding the elements is important, but denying the existence of the system because it is hard to understand is not a serious position, imho.

    One isn't denying the existence of the system. One is denying that the system has a personality. I pretty much said exactly the same thing above.

    Or let's put it this way: people can exist without the system, the system cannot exist without the people.

  • engineer||

    "Sure, but it is still individuals interacting with one another, not individuals interacting with some abstract thing called society."

    Point was recession can perpetuate thru positive feedback. THink that was sorta NM's argument too.

  • ||

    Here's what I found to be a nice explanation of Austrian macroeconomics and business cycle theory. It's a set of powerpoint presentations by a Professor Garrison that's fairly intuitive (or at least doesn't skip anything too large in its lines of reasoning) and draws direct comparisons with more conventional macro theory.

    The presentations are linked on this page:

    AUSTRIAN BUSINESS CYCLE THEORY IN POWERPOINT

  • Seward||

    engineer,

    Well, even if that is the case, and it is a highly problematic notion IMHO, all that would mean is the study of the individual interactions via that positive feedback.

  • Seward||

    some fed,

    Well, yeah, but we are more directly talking about methodology.

  • Seward||

    And without further delay (and since I am discussing this in a rather muddled way), here is Rothbard on praxeology:

    http://mises.org/rothbard/praxeology.pdf

  • A T||

    At least Austrians don't have these wild claims that they can cure and manage the economy. Even if they are wrong, they can't do too much damage.

    Also, lay of the engineers. They are quite humble about their achievements. That's why you have disclaimers on board airplanes (emergency instructions) because they admit it COULD go down.

  • Seward||

    Neu Mejican,

    BTW, why would you have any sort of impression about Austrian economics based on what two blog commentators say about it?

  • robc||

    NM,

    There is no [brain, body, solar system]; there is on the [neurons, organ, objects] that make it up.

    That would be a good analogy IF neurons to brains was like people to society. However, while neurons can be treated individually, they also, as a group, have a self awareness at the higher (brain) level. Decision making happens at the brain level, and it isnt just neurons voting.

    The same doesnt apply to individuals/society. There is no self-awareness to society. Society doesnt act as one unit. A brain that was split and pulling in different directions like society is would be insane, most likely. For society, that is normal, because society really is the sum of independent individual actions.

    The brain is not just the sum of independend neuron actions.

    I will call on Descartes here:

    "Cogito ergo sum" works for the person, but not for society.

  • Gilbert Martin||

    "Why not? Because, writes Steve Chapman, there is no persuasive way of determining the effect of implementing the president's policies. No matter what happens, each side can claim vindication."

    Of course in any LEGITIMATE debate, no one has to prove a negative. The burden of proof always rests on the side claiming the affirmative - in this case a claim that the "stimulus" has improved the economy.

  • Seward||

    robc,

    Yeah, that was in the range of what I was trying to get at during this low blood sugar moment. Thanks.

  • DADIODADDY||

    If they're so smart how come they're not all wealthy...

  • libertarian democrat||

    I know this has been covered, but I seriously wonder about any educated person that doesn't realize that psychiatrists are physicians (many - probably most - of whom have spent time treating cancer as 3rd and 4th year med students and during their medical internship prior to their psychiatry residency), and that many psychiatrists (such as those in consult liaison or neuropsychiatry) may have more experience working with oncologists and cancer patients than many other medical specialties.

    Shorter: What a fucking moron.

  • engineer||

    "At least Austrians don't have these wild claims that they can cure and manage the economy. Even if they are wrong, they can't do too much damage."

    Agreed. First real fed attempt to manage economy=federal reserve policy.Love where that got us.

  • engineer||

    Panics prior to the crash of '29: Fairly mild. Some distortion thru fractional-reserve banking, but never an all-out catastrophe causing decade-long depression. Major change? Fed policy encouraged inflationary distortion during boom (lower interest rates + lower reserve ratios) and deflation in the bust (raised reserve reqs and interest rates)

  • ||

    You'll have to understand the perspective of your opponents better if we're to convince anyone.

    Austrians do too have wild claims (wild as viewed by their opponents) that they can cure and manage the economy. Popular Austrian policy recommendations of ending regulation and the monopoly on the money supply are just as radical to most people as Keynesian advocacy for borrowing and spending trillions.

    Sure, you and I see laissez-faire as benign, but most people see laissez-faire as dangerously leaving their livelihoods to chance.

    I assure you that Krugman, at least, is quite convinced that Austrians would destroy civilization if given the chance to enact a program.

  • ||

    since Hayek won his Nobel it has had a renaissance.

    That, together with having predicted the collapse of the Soviet Union, and the fact that the Austrians were warning everyone about the last three bubbles while we were still in the expansion phase, while all the Keynesian clowns were pretending that inflation is just fine and dandy.

    -jcr

  • ||

    "Clearly there are both systems and the elements that make up those systems. Understanding the elements is important, but denying the existence of the system because it is hard to understand is not a serious position, imho."

    Hard for whom? God?

    It's not just hard for people to understand, it's impossible.

  • Seward||

    engineer,

    Well, Austrians place the locus of the boom and bust cycle on the inflationary and deflationary policies of central banks/governments.

    Anyway, time for lunch; I need it.

  • ||

    Austrians do too have wild claims (wild as viewed by their opponents) that they can cure and manage the economy

    NO, NO, NO!

    No Austrian economist will ever make such a claim.

    Austrians say that the economy will cure itself if the government just quits fucking with it.

    -jcr

  • Neu Mejican||

    Seward,

    I was commenting on the characterization of Austrian economics being presented.

    It's superiority is being touted based on its superior BELIEFS about the nature of the problem that circumscribes the problem space. If the proper unit of study is the individual because the institutions don't exist, have no reality, etc...Austrians have nothing to say about the economy.

    You've now moved the goal post to "interactions between individuals" so the analogy is the study of synapse rather than neuron, but you still have the same problem. (with the addition of the problem of deciding how many individuals interacting it takes before you have moved from a proper problem space into a study of a non-existent "institution.").

    That would be a good analogy IF neurons to brains was like people to society. However, while neurons can be treated individually, they also, as a group, have a self awareness at the higher (brain) level. Decision making happens at the brain level, and it isnt just neurons voting.

    The same doesnt apply to individuals/society. There is no self-awareness to society. Society doesnt act as one unit. A brain that was split and pulling in different directions like society is would be insane, most likely. For society, that is normal, because society really is the sum of independent individual actions.

    The brain is not just the sum of independend neuron actions.



    This is a nice set of beliefs you have. It is, however, not a scientific position. Ignorning for now the clear misrepresentations of brain function that are foundational to your description, let's stay at the level of speculation you have set up here: IF societies were self-aware, do you think that they individual units (people) would be aware of that awareness? Neurons are the elements in a self-aware system...but they do not themselves have awareness of the brains awareness.

    Now, to the larger issue. The conflation between "self-aware people" and "the society" or "the economy" is not one that I introduced into the discussion. That is your characterization of emergent phenomena in complex systems. And it is, I would say, a strawman...

  • Neu Mejican||

    One isn't denying the existence of the system. One is denying that the system has a personality.

    To the tape: "There is no institution or system; there is only the individuals that make it up."

    The Personality claim is both separate and tangential.

  • Neu Mejican||

    Robbie Clark,

    [sigh]

    Yes, man's hubris is unending and destructive.

    We should not try to understand the mind of god for we are not worthy.

  • Neu Mejican||

    robc,

    I want to clarify a bit...

    If societies are self-aware...how would the individual units (people) determine this?

    It is clear that they would not have direct access to the awareness of the larger structure, so there would need to be some inferential process implemented to identify that feature of the larger system.

  • Seward||

    Neu Mejican,

    It's superiority is being touted based on its superior BELIEFS about the nature of the problem that circumscribes the problem space.

    So now are you "commenting on the characterization of Austrian economics being presented?"

    If the proper unit of study is the individual because the institutions don't exist, have no reality, etc...Austrians have nothing to say about the economy.

    They have no reality as entities with personalities of their own. This is the third time I have stated this. Shall we go for a fourth?

    You've now moved the goal post to "interactions between individuals" so the analogy is the study of synapse rather than neuron, but you still have the same problem.

    That was always the goal post. Look, I'm sorry that I don't relay to you every unstated assumption, but people familiar with Austrian economics know what it means when they make this point.

    Anyway, individual humans aren't anything like synapses, they have, for one thing, agency, which synapses lack. Now philosophers for many centuries (this includes Hobbes) have tried to compare society to the human body, but it is an analogy which easily breaks down in part because of the agency issue. Kant recognized this when he argued that people should not be the means of actions, but the ends. Sadly, modern governments, including the U.S. government, still use individuals as the means of actions.

    Anyway, as I hinted at earlier, if you are really interested in Austrian economics then a good place to start are the FEE lectures on iTunes.

  • Neu Mejican||

    The brain is not just the sum of independend neuron actions.

    Yet humans are independent actors able to extract themselves completely from the influences of their context?

    That's not your point, I assume.
    Could you clarify?

  • Seward||

    Neu Mejican,

    To the actual tape:

    There is no institution or system; there is only the individuals that make it up. Or to borrow an example from someone else, the Congress is not an entity, it is made up of a bunch of discrete individuals pursuing their own individual wants, etc. Austrians don't assume that society, institutions, etc. have a personality; that is a moronic concept which 19th century sociologists thought up.

    You have to read the sentence in the context of the entire paragraph to understand what I am getting at. Anyway, have a good lunch.

  • ||

    I think this basically means that economics isn't a science at all.

    Economics is a science, but Keynesians aren't economists. Keynes is to economics as Lysenko is to Biology.

    -jcr

  • Neu Mejican||

    Seward,

    So now are you "commenting on the characterization of Austrian economics being presented?"

    From the beginning, that was what I was doing...that was the point of the phrase "but it sounds like you are saying that"

    Anyway, individual humans aren't anything like synapses, they have, for one thing, agency, which synapses lack. Now philosophers for many centuries (this includes Hobbes) have tried to compare society to the human body, but it is an analogy which easily breaks down in part because of the agency issue.



    Yes, like all analogies, it breaks down at some point. The issue of agency is certainly a factor that needs to be considered in understanding the larger system. And the issue of whether or not the larger system HAS agency is one that would need to be proven, not proclaimed. It would also require that you are very careful in your definition of "agency." Standard definitions of the term fit comfortably into a description of features of an institution.

    Institutions act.

    Indeed the complaint the Austrians are being said to make is that they do not approve of the actions of institutions in the economy.

  • Neu Mejican||

    Seward,

    I read the sentence in the context you placed it.

    I rejected both substantial points.

    1) Institutions do not exist...only collections of individuals exist.
    2) Austrians are different than other economist because they do not assume that societies have "personalities."

    The first is a claim about the proper scope of the problem. It claims that the study of institutional behavior is not the proper level of analysis, because the institution is just an epiphenomena of the individuals and their interaction.

    The second is a statement about the beliefs of those that do see the institutional level as an appropriate unit of study...and it is a misrepresentation of what is being studied.

  • Neu Mejican||

    Seward,

    Anyway, individual humans aren't anything like synapses, they have, for one thing, agency, which synapses lack.

    I would just like to point out that this mixes the metaphors quite completely.

    Synapse = interaction between neurons.

    Interactions don't have agency whether between neurons or humans in the sense your are using agency...only entities have agency in this sense.

    The debate is about whether collections of individual humans have status as an entity allowing the claim that the collection possesses the trait "agency."

  • Barry Loberfeld||

    Emma: Look, you know what blows all this talk out of the water? There have been a number of studies that found that they raised the minimum wage and it wasn't followed by any mass unemployment like predicted.
    Adam: I'm not saying an increase in the minimum wage would destroy all or even a majority of low-end jobs, though it might a significant minority. Again, an increase in the cost of living is the main result of the increase in the cost of labor. But the bigger point here is, empirical studies prove nothing -- not in economics.
    Emma: Theorizing around a table is science, but actually measuring the real-world impact of those theories isn't?
    Adam: Couldn't have said it better myself!
    John: Adam, seriously. What do you mean?
    Adam: Science is about nothing if not controls. But the economy isn't a laboratory, and it doesn't allow for controls. Do you realize just how many factors other than the wage increase were responsible for the employment rate? We would have to keep all those factors as a constant in order to isolate and gauge the effects of the wage increase. But that's exactly what we can't do with the real world. These "studies" aren't tests that prove or disprove a hypothesis. At best, they're surveys. Presenting them as experiments demonstrates only the inability to distinguish correlation from causation -- the post hoc ergo propter hoc fallacy.
    Emma: So what are we supposed to do with the actual data -- dismiss it completely because it contradicts your theory?
    Adam: No, not at all. We evaluate it in light of the theory. It simply means that the depressing effect of the wage increase was obviously overcome by the uplifting effect of other, beneficial factors. Of course we should also keep in mind the many below-minimum-wage workers of the "underground" -- off the books -- economy, who aren't measured by these studies. Their wages purchase, among other things, the labor of workers in the conventional economy, who are measured.
    John: It seems to me that since you have theory as the basis of everything, we have to ask what is the basis of this theory.

    READ THE REST

  • Chad||

    Hurry for Chapman! It is nice to see someone pointing out what I have said a thousand times. Trying to connect short and medium-term economic fluctuations to particular policy decisions is simply bogus. Before any boom, you can always find some policy change that you liked - and assert causation. Look at the time before any bust, and it is certain you can always find some policies you don't like - allowing you to assert causation.


    Reality is far more complex. The economy bounces up and down regardless of what left and right do with the 1-2% of GDP they are squabbling about.

  • robc||

    NM,

    I thought about this over lunch, figuring it would be the response, and a reasonable one, in fact.

    If societies are self-aware...how would the individual units (people) determine this?

    Society would let us know.

    It is clear that they would not have direct access to the awareness of the larger structure

    That is not even remotely clear. In fact, I accept that as an anti-premise.

    , so there would need to be some inferential process implemented to identify that feature of the larger system.

    Not necessarily.

    The analogy earlier breaks down because neurons are not self-aware themselves. While there is no guarantee that a "self-aware" society would communicate that awareness down to the individual, it is also not obvious that it wouldnt.

    Consider God. Some claim he has made us aware of his existence, others disagree. While that is slightly different, as we are not subsets of God (IMO, others disagree on this too), but as an analogy, I think it works.

  • Neu Mejican||

    It is clear that they would not have direct access to the awareness of the larger structure

    That is not even remotely clear.



    I am trying to imagine why not.

    If the processing by the system were to lead to self-awareness, for the individual units to have direct access to that total experience would require that each unit has similar processing capacity and input to the whole system.

    Any access to the awareness of the system by the units would have to be indirect, via inference, or, as you posit, because the system has boiled down the information and presented it in a form that the unit can understand (that would be indirect access, I believe).

  • robc||

    NM,

    I think we are arguing different things here - "direct access to the awareness" means "aware that it is aware", nothing more. I think you mean more by that.

    Its a 1 or 0, Do I know that society is aware? I see no reason we wouldnt have access to that bit (literally) of info.

  • robc||

    that would be indirect access, I believe

    Society (or God) coming to me and saying I EXIST!!!!, is pretty damn direct access, IMO.

  • Neu Mejican||

    robc,

    I, indeed, mean more by "direct" than you do.

    Your awareness via a system of communication is not direct, in the sense that I am using it.

    You have secondary access to their self-awareness via your sense organs in the scenario you describe.

  • Sean W. Malone||

    NM:

    If you want to learn about Austrian Econ - of which I have long been a student and a fan - I suggest you actually take the time to read Ludwig von Mises' "Human Action" for a better understanding of what Seward and some others have been saying on here.

    At the very least you will come to understand why they strongly believe that logical/empirical positivism applied to economics is the wrong tool for understanding.

    It's hard to explain in a paragraph or two, but it starts to some degree with the assumption that all humans act independently based on their own values. Now, you want to reject this because you think that "society" has a mind of its own, but first off - you're basically operating under a fallacy in even thinking that... Humans act and are influenced by each other's actions - so when you observe a societal shift towards one idea or another, you ascribe that as the cause of individual shifts in behavior - rather than recognizing that your observation was a result of individual shifts. But secondly - you labor under the delusion that you can reduce human behavior to polylogism and group-think. This then simultaneously assumes that the world is fundamentally a different place for people in different groups (race, ethnicity, culture, class, etc.) and that an economist could create a simplistic model to reflect what group he was observing. That's damned ridiculous.

    The thing that gets lost in the shuffle here is that the Austrians have diverged so much from the mainstream because of severe differences in their underlying methodological concepts.

    This is compounded by the problem of Keynesians saying that they reject "testing" as if their conclusions are based on nothing but whatever they feel like at the time. This couldn't be further from the truth. The school of thought rests on a series of axioms which have been observed over time... For example; Incentives matter. Individuals act, and "action is the purposeful employment of means to achieve ends in accord with the actor's values."

    Also, that values are ordinal and not cardinal... AND that the specific values of individuals change ALL THE TIME.


    The point is - NONE of that can really be effectively modeled mathematically, and it certainly can't be "tested" in the sense that you can do a chemistry experiment. If the axioms are correct, then it's up to the economists to debate logic and expose/eliminate flaws in reasoning in order to determine whether theories are right or wrong.


    This sounds "un-scientific" to those used to positivistic sciences like physics or chemistry, but it's really just a deductive process, and it's allowed the Austrians to consistently and very specifically predict events again & again & again which the mainstream neo-classicists have not only utterly failed to recognize, but have actively predicted the opposite. (I would link you there, but it seems that a cursory observation of the failures that are running the Federal Reserve & advising Obama will suffice.) So really, I would think you'd like to judge the success or failure of a scientist by his ability to be correct in his hypothesis consistently, yes? If so then the Austrians win hands down.



    Anyway: Here are a few Austrian-related links.

    Science is as Science Does

    and...

    The Epistemological Roots of Monism: Fallacies of Positivism by Ludwig von Mises in "The Ultimate Foundation of Economic Science"


    Sorry for the long post everyone... but this is a complicated one.

  • A T||

    That control and laissez-faire are both wild, or extremes of policy, only works if you put the center somewhere between them. That is only consistent with the modern political delimitation. There's a site somewhere about cheating, and it says something like "outrage at the act of cheating and leniency are both extremes of human nature..". This kind of "finding the middle ground" is too much an attempt to compromise with everybody's feelings. It may feel good, but it ain't right.
    Now back to the economy: controlist policies sound all nice and dandy but can have horrendous effects, all through the ages. Liberty, on the other hand, does not promise heaven, but the possibility of getting somewhere near. Nicholas Taleb had a nice point: he said he didn't like free markets because he thought Adam Smith was right over Keynes, but because under a free system individuals might just stumble upon success, with not just personal but public good consequences. If they fail, or if they are outright malevolent, their power is limited by the power of all the other free players. In a controlled environment, if the master keeper fails, even in minuscule details, the effects are broad and hard to counter. He can always claim, life is complex, don't expect miracles.

  • A T||

    Also, Chad; the economy is a big engine. You throw a wrench into an engine (effective of 1-2% of GDP) and the engine can break.

  • DC||

    Bah! Psychiatrists are doctors.

  • Seward||

    Neu Mejican,

    Yes, like all analogies, it breaks down at some point.

    It breaks down fairly viciously actually, since that sort of reasoning lies behind most forms of state sponsored barbarism.

    The issue of agency is certainly a factor that needs to be considered in understanding the larger system.

    Agency is really the only factor to be considered actually.

    Standard definitions of the term fit comfortably into a description of features of an institution.

    "Standard definitions" (whoever determines that) vary wildly actually, and so some fit within the notion that there is collective decision making and others do not.

    Institutions act.

    No, people within institutions act. All actions come from people; individuals, whether working by themselves, or in concert with others.

    Indeed the complaint the Austrians are being said to make is that they do not approve of the actions of institutions in the economy.

    No, that is not the case. The basic problem here is that

    The first is a claim about the proper scope of the problem. It claims that the study of institutional behavior is not the proper level of analysis, because the institution is just an epiphenomena of the individuals and their interaction.

    The second is a statement about the beliefs of those that do see the institutional level as an appropriate unit of study...and it is a misrepresentation of what is being studied.


    Dude, that's not what I was thinking when I wrote what I wrote. So is who is the better judge here of what I was thinking? Myself, or you? I am. We can of course go round and round this, but you are going to have take my word for it.

  • Seward||

    Sean W. Malone,

    Hey, we C leaguers try our best. :)

  • Paul||

    1930s was that it was essentially build on a model resembling 19th century physics. Ir is argued still today economics as a discipline is basically still in the throws of 19th century positivism

    We're looking for our keys over here, because this is where the light is.

    Sheesh.

  • Seward||

    Neu Mejican,

    Interactions don't have agency whether between neurons or humans in the sense your are using agency...

    Synapses are actually more than interactions; they are physical processes that have physical stuff associated with them. Wikipedia calls them "junctions." In the world of human beings these are middle men, traders, etc.

  • Sean W. Malone||

    Yeah.... I reallllly don't get why anyone would think that neurons and organs:person is an appropriate analogy to individual people:society.

    The analogy breaks down instantaneously. Neurons don't make their own decisions. People do. You have to understand the difference.

  • Neu Mejican||

    Synapses are actually more than interactions; they are physical processes that have physical stuff associated with them.

    What?!!!!...interactions are physical processes that have physical stuff associated with them as well.

    If we go down this road I have to point out that synapses are a location where interaction occur. What they clearly are not are "entities" that make the exchange. Your middle man analogy is inapt in the extreme...perhaps the synapse is the store or market.

    No, people within institutions act. All actions come from people; individuals, whether working by themselves, or in concert with others.

    This, by the way, can be summarized as institutions are just "epiphenomena of the individuals and their interaction."

  • Neu Mejican||

    Sean W.

    A more detailed characterization, for sure. But, unless I am misunderstanding you, you are maintaining the strawman...

    You just describe it in greater detail.

    Now, you want to reject this because you think that "society" has a mind of its own, but first off - you're basically operating under a fallacy in even thinking that... Humans act and are influenced by each other's actions - so when you observe a societal shift towards one idea or another, you ascribe that as the cause of individual shifts in behavior - rather than recognizing that your observation was a result of individual shifts.

    I am assuming that "you" is not referring to me, but to some generic "you" who thinks this...

  • Neu Mejican||

    The analogy breaks down instantaneously. Neurons don't make their own decisions. People do. You have to understand the difference.

    Hmmm...

    Not clear at this point if ya'll understand the analogy AT ALL. Or perhaps you are not understanding the function of analogy in discourse.

  • Neu Mejican||

    This exchange, btw, has been a nice example of polysemy's effect on communication.

    Synapse = location where neuron's interact (noun).

    Synapse = the interaction of neurons (verb)

  • Sean W. Malone||

    What strawman am I maintaining again? And yes, I was referring to a generic "you". Not indicting anyone specifically... Well, indicting the vast bulk of mainstream economists - Paul Krugman, etc.

  • Seward||

    Neu Mejican,

    What?!!!!...interactions are physical processes that have physical stuff associated with them as well.

    The wikipedia article pretty clearly describes them as a thing. Interaction implies in my mind that you are talking about a process, and not a thing.

    I understand the analogy. I think that the analogy is inapt and is not terribly useful.

    Anyway, even a store is more than just an "interaction." A store exists because of the agency of individuals working by themselves or in concert. So individual agency is present whether the synapse is a store or a middle man.

  • Seward||

    Neu Mejican,

    This exchange, btw, has been a nice example of polysemy's effect on communication.

    Roughly 99% of blog arguments concern honest misunderstandings of some variety or another. This is why I avoid claiming that someone is "moving goalposts" or being "duplicitous."

  • Sean W. Malone||

    Your analogy is crap NM, and you've used it before. PEOPLE ACT on their own volition. People are autonomous decision-makers. Our organs aren't.

    Of course I understand what you're trying to get at it, but as I said, your analogy breaks down before I even consider it a useful analogy. If you don't recognize the difference between human beings who think, make decisions and are independent actors and component parts of chemicals or cells or atoms... I mean seriously. There's no comparison there. And as Seward (i think) said; that kind of thinking - the idea that we're all just part of a system that can be managed and controlled and that we are the neurons to a giant "brain" that is government or a king pulling the strings of society..... c'mon.

  • neu mejican||

    Sean W.

    This is the strawman

    you think that "society" has a mind of its own

  • Neu Mejican||

    People are autonomous decision-makers.

    This is not, strictly, true...in the context of the analogy. That is why I believe you don't understand the analogy.

  • Sean W. Malone||

    I believe you've provided a horrendous non-analogy. Try again :P

  • Neu Mejican||

    Oops,

    People are autonomous decision-makers. Our organs aren't.

    THIS is not strictly true in the context of the analogy (brain = society).

    I believe the misunderstand comes from the brain end.

  • Sean W. Malone||

    And the above is really not a straw-man, it *is* what Keynesians believe fundamentally. It's exactly why neo-classical "Macroeconomists" can't predict a damn thing right. When you reduce an incredibly complex system made up of individual (yes... individual) actors, each with independent and constantly changing values making their own unique choices into an "aggregate" - you necessarily fail to make allowances for the complexity of the thing you're studying AND worse, fail to understand why (in this case) the market does what it does.

    It's subsequently why they fail. And since they really are operating under the assumption that society has a unified mind, and have to in order to create mathematical models that are actually manageable (300,000,000 variables is just too many, isn't it?), then I'm really not using a straw-man at all.

  • Sean W. Malone||

    NM, organs aren't autonomous decision-makers like humans, neither are neurons, neither are mitochondria. The parts are not equal to the whole here, but that analogy just doesn't scale upward.

    I am not to society what a neuron is to my brain because I make my own decisions, and my neurons don't in any comparable way.

    That said, on the flip side of this, let's say for example that my neurons were independent actors that had their own decision-making processes and it was a good analogy. Even so, I don't dictate what my neurons do specifically. I don't direct my body processes, I would then be just as much a beneficiary of spontaneous order as society would be - and there's still no evidence to suggest that I would be better off if I started trying to send out relays to tell my heart to speed up or slow down or anything else that happens automatically as a result of that order. So even if you'd created a good/functional analogy - which I don't think you did - how does that change things? It's still a bad advocate for controlling anything, and the overall libertarian position still makes more sense.

  • Neu Mejican||

    Sean,

    So even if you'd created a good/functional analogy - which I don't think you did - how does that change things? It's still a bad advocate for controlling anything, and the overall libertarian position still makes more sense.

    You will note that I have not taken a position on the benefits (or lack therof) of control in the economy.

    This has been a discussion about the underlying assumptions and methodological issues.

    The comment that started this said that Austrian economics was superior BECAUSE it was reductionist...because it rejects the CONCEPT of macro and reduces it instead to "its micro roots."

    Seward and now you have both supported this view with more detailed statements, but that does not change the basic flaw in reasoning. An axiomatic rejection of the existence of the macro level does not lead to better understanding of the questions that emerge when one acknowledges the emergent macro level phenomena.

    While it is valid to say that an understanding of the individual is essential to understanding the economy, and while it is certainly valid to say that a well developed theoretical framework for how the individual units function is essential to understanding the larger system...the claims that I am seeing here are not that circumspect. They are, rather, grand claims that aggregate behavior is not worthy of study and can not shed light on the workings of the economy.

    But, it seems, macro level methods are proper for macro level questions. They are inappropriate for certain questions, but that does not warrant the whole sale rejection of macro level economics as an area of study.

  • Seward||

    Sean W. Malone,

    You are correct, it isn't a strawman. One of things I quickly figured out in the one macro class that I took was that essentially the micro world doesn't exist in neo-classical economics.

  • Seward||

    Neu Mejican,

    An axiomatic rejection of the existence of the macro level...

    No one here of course has done this.

  • Sean W. Malone||

    The Austrians really reject the idea that the economy at a larger scale operates on different principles. It doesn't. At the root of every economic action is a human. Whether or not it's a human dealing with one other human, or 10 dealing with 1000, the root is always human action... They're not rejecting the "existence" of a macro level, but they're rejecting the idea that bad mathematical models and lumping millions of people into a group as if it is an entity of it's own is a good way to understand economics at all.

    It's not a flaw in their reasoning to reject the method of the empirical positivists... That much can be made perfectly clear by their consistent accuracy and their opponents' consistent failure.

  • Neu Mejican||

    Seward,

    Hmmm...I guess we are dealing with another failure of language then.

    Sure, but it is still individuals interacting with one another, not individuals interacting with some abstract thing called society.

    Are you not questioning the status of "society" here?

  • Seward||

    Neu Mejican,

    I guess I'll be a jerk, but I am getting sucked into this new version (2000) of On the Beach.

  • Neu Mejican||

    Seward,

    Not sure how that makes you a jerk.

    Sean,

    It has not, really, come up yet, but I seem to recall that Austrians were pretty adamant that prediction was not a meaningful goal of economics.

    And to clear things up here...(correct me if I am wrong):

    Rather than "rejecting the reality" of the macro level...the Austrian position is closer to saying that the aggregate level is without independent meaning...is uninterpretable without the micro-level.

    And this issue of mind is, I believe, a misconstrual of the idea that aggregate level behaviors are "unintended consequences."

    But that is really a tangent to the issue of whether or not institutions have agency.

  • Neu Mejican||

    Macroeconomic claims that aggregate behavior can be meaningfully interpreted without reference to the underlying psychology of the individual actors DOES NOT reduce to a belief that the aggregate behavior causes the individual behavior. It also does not reduce to a belief that they describe the "mind" of society.

  • Sean W. Malone||

    It has not, really, come up yet, but I seem to recall that Austrians were pretty adamant that prediction was not a meaningful goal of economics.




    Correct-ish... They're not into making predictions based on models, etc. because human actions change, but they're very big on saying things like "If you impose price controls, shortages will ensue" or "If you (Federal Reserve) dump trillions of dollars into an economy, you will experience an unsustainable boom and eventually - assuming the money remains in the system (which is almost always does) inflation will be the inevitable result."

    They're really not opposed to predicting though, just not based on econometric modeling... See:

    And this issue of mind is, I believe, a misconstrual of the idea that aggregate level behaviors are "unintended consequences."


    I think that's a more accurate description, yes. Humans act as individuals, and then when you look at the big picture, whatever is a result is whatever you get from all of those actions. It doesn't necessarily have a pattern or operate in a truly predictable way as an independent entity. Individuals react in predictable ways given certain incentives, but the circumstances of each individual are rather different and hard to lump together.

    **Disclaimer: I'm not, obviously, a professional economist. It's better to read Hayek on the limits of knowledge, Mises on human action, Rothbard on history, Reisman on capital theory, etc..... Or Tom DiLorenzo, Bob Murphy, Tom Woods & Walter Block for the "younger" generation.

  • Sean W. Malone||

    Oh lord.... That was an epic fail, wasn't it?


    That was to be:

    "See: Peter Schiff"

    I won't bother re-linking ;)

  • Sean W. Malone||

    Nah, screw it - I need to redo it, I accidentally hit submit instead of preview and that was just a mess... Round 2:

    It has not, really, come up yet, but I seem to recall that Austrians were pretty adamant that prediction was not a meaningful goal of economics.



    Correct-ish... They're not into making predictions based on models, etc. because human actions change, but they're very big on saying things like "If you impose price controls, shortages will ensue" or "If you (Federal Reserve) dump trillions of dollars into an economy, you will experience an unsustainable boom and eventually - assuming the money remains in the system (which is almost always does) inflation will be the inevitable result."

    They're really not opposed to predicting though, just not based on econometric modeling... See: Peter Schiff

    And this issue of mind is, I believe, a misconstrual of the idea that aggregate level behaviors are "unintended consequences."



    I think that's a more accurate description, yes. Humans act as individuals, and then when you look at the big picture, whatever is a result is whatever you get from all of those actions. It doesn't necessarily have a pattern or operate in a truly predictable way as an independent entity. Individuals react in predictable ways given certain incentives, but the circumstances of each individual are rather different and hard to lump together.

    **Disclaimer: I'm not, obviously, a professional economist. It's better to read Hayek on the limits of knowledge, Mises on human action, Rothbard on history, Reisman on capital theory, etc..... Or Tom DiLorenzo, Bob Murphy, Tom Woods & Walter Block for the "younger" generation.


    THERE. Good god, that first one was pitiful. Apologies.

  • Sean W. Malone||

    Also - again, the models are horrendous most of the time, because I mean... even if you were able to reduce human behavior into only *one* variable and lump everyone into a group that all acted and thought and did the same things... there are still hundreds of variables that they necessarily leave out of any econometric model. Then of course, they usually "correct" the models as real data comes in and contradicts what their model predicted anyway... It's really a mess what most of these guys are doing if you ask me.

  • Neu Mejican||

    I think that's a more accurate description, yes. Humans act as individuals, and then when you look at the big picture, whatever is a result is whatever you get from all of those actions. It doesn't necessarily have a pattern or operate in a truly predictable way as an independent entity. Individuals react in predictable ways given certain incentives, but the circumstances of each individual are rather different and hard to lump together.

    Individuals are predictable, but averaging this predictable behavior results in chaos?

    No. You are operating with a basic misunderstanding here. I am pretty sure the Austrian position is not this misinformed.

  • Sean W. Malone||

    Individuals react in predictable ways based on incentives and their values - BUT NM, you have no way of knowing what everyone's values are!

    You really miss the point there. If you look at specific cases, you can get a good idea of what people might do, *if* you implement this or that policy based on the incentives it creates, you cannot however predict all human behavior in all cases. How did you miss that?

    I really don't get what's so hard to understand about all this... You cannot lump millions of people who all have a DIFFERENT value system, and a DIFFERENT set of individual incentives operating in their lives into one giant "aggregate"! This isn't all that complicated. People are obviously somewhat predictable and respond in similar ways to various incentives, but the mistake, and a gigantic one at a that, is assuming you can know what everyone is thinking all the time, or that you have more knowledge as a researcher than they do.

    Ugh... Seriously, go read Hayek. At some point it gets annoying trying to tell someone that they are not smart enough to know everything there is to know about 300,000,000 people. That should be self-evident. You, Obama, Krugman... Nobody, has more knowledge than the combined and dispersed knowledge of everyone living in even a small town, much less than that of the entire US. When you make an econometric model that combines all people and squishes them into a mathematical model that treats them as one unified variable, your model is fucking retarded. That's the bottom line. But the more I keep trying to explain to you that you are incapable of knowing, much less predicting, the behavior of groups - because groups *don't* act independently - the less you seem to understand, and honestly that's fine.

    I'll keep listening to economists who've accurately predicted economic events, who can clearly explain why they're happening in logically & historically non-contradictive ways and as a result, I will continue to not be surprised when Paul Krugman is wrong again & again & again.

  • Neu Mejican||

    Sean,

    Really, I understand what you are saying...and I disagree with your conclusions because they seem to be based on a basic misunderstanding of the underlying principles involved in aggregation and the kind of information it provides.

    You are essentially saying (to use an analogy again) that poetry is the wrong approach because it doesn't result in a good dance. The two approaches/perspectives we have been discussing tell you qualitatively different things about the economy.

    The whole "Nobody, has more knowledge than the combined and dispersed knowledge of everyone living in even a small town, much less than that of the entire US" carnard is a malarky. No one is claiming that their economic model gives them this KIND of knowledge, let alone a greater AMOUNT of knowledge.

    But the more I keep trying to explain to you that you are incapable of knowing, much less predicting, the behavior of groups - because groups *don't* act independently - the less you seem to understand

    Actually, the more you explain, the more clear it becomes that you don't know what you are talking about.

  • Sean W. Malone||

    Right. Because I'm not speaking in terms you understand. Sorry about that NM. It's happened before.

    As I said from the beginning. GO READ HAYEK & MISES. If you don't like the way I'm explaining this, go to the source. It's clear enough to me and it was, I think, clear enough to Seward - and my understanding is good enough that I have had an article published by the Ludwig von Mises Institute, so ya know... I think I'll take their assessment of my understanding over yours.

    God damn you turn in to a cock easily when you don't understand what people are talking about. I can never tell if it's willful or not man.

    And YES, for the record, the fundamental purpose of econometrics and of central planning is predicated on EXACTLY the idea that those economists & politicians know more & know better than millions of people about their own lives. That much should be completely obvious, because if they didn't, then planning for all those people wouldn't even be considered.

  • Sean W. Malone||

    One more thing while I'm at it.

    If you want to learn about what I'm talking about, I've linked you a couple times already to the books & essays that are supporting what I've been talking about. I can't re-write them, because A. it's not my job, and B. FA Hayek did a hell of a lot better than I would ever do.

    The fact that you're still whining to me about not explaining things to your satisfaction is absurd.

    AGAIN... GO READ THE SOURCE MATERIAL!


    The excessively stupid part is that you're basically arguing in favor of the ideas of people who have actually failed to predict anything in real life, and whose reasoning has obvious holes - holes so glaring it's incredibly easy for me, a non-economist to pick apart Paul Krugman articles for logical fallacies and fundamentally bad assumptions (when it's not just simply dishonest... which also happens). Frankly, when a nobel-prize winning economist's reasoning is as horrendous as Krugman's, everyone should really stop and start asking more questions about methodology.

    The alternative, what I'm advocating here, is for you to listen to the people who actually have been and are consistently right, in the real world about what is going to happen, why and how the system works.

    How silly of me to think that actually being quantifiably right over & over may correlate strongly to having better ideas than the guys who are always wrong.

  • Neu Mejican||

    Sean,

    For the record. I have read Hayek and Mises et. al.

    I am talking specifically about your characterization of the multivariate techniques used in macroeconomics and the proper interpretation of them.

    This...is the strawman.

    And YES, for the record, the fundamental purpose of econometrics and of central planning is predicated on EXACTLY the idea that those economists & politicians know more & know better than millions of people about their own lives.

    The fact that you BELIEVE this to be true, does not make it true.

  • Neu Mejican||

    The fact that you're still whining to me about not explaining things to your satisfaction is absurd.

    I will remind you that I have been asking you to explain YOUR thinking...YOUR understanding of these issues, YOUR reasoning for favoring the Austrian position.

    How that is whining, I am not sure.

  • Neu Mejican||

    The alternative, what I'm advocating here, is for you to listen to the people who actually have been and are consistently right, in the real world about what is going to happen, why and how the system works.


    You keep saying this.
    It lacks veracity.

  • Neu Mejican||

    In case you actually read this.

    Let's flesh out the problem with your strawman.

    Hayek's point about the the amount of distributed knowledge in the system being larger than the aggregated knowledge that managers have access to is true.

    However, providing managers with MORE knowledge is not what the aggregation process is attempting to do. It is attempting to provide a different type of knowledge that may be useful for different types of decisions than are being made by the individuals in the dispersed interactions that make up the system.

    So, the key phrase becomes..."know better than millions of people about their own lives."

    The aggregated knowledge is about the aggregated population NOT the lives of the individuals. Likewise management is NOT about managing the lives of the individual, per se, but managing the impact that the dispersed actions have on the system as a whole.

    The qualitative difference between the activities at the system level and the activities of the individuals hold across all domains: goals, purpose, knowledge type, etc...

    Hayek's critique is an important one.
    Your characterization of it HERE is a strawman.

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