What Are the Best Books About Austrian Economics?

At The Browser’s great Five Books interview series, George Mason University economist Peter Boettke recommends some important works written from the perspective of Austrian economics. Not surprisingly, the names Ludwig von Mises and Friedrich Hayek figure prominently in his list. Here’s a snippet from the long and very interesting interview:

Are you saying mainstream economics can’t handle the complexities of the real world?

This is why methodology of the social sciences matters. It defines not only what we consider to be good questions, but probably more importantly what we consider acceptable answers. A lot of people within mainstream economics would like to handle complexity, and we see them constantly striving to do it, but they constrain their efforts by certain methodological straitjackets. They claim they have to fit things into formalistic models, otherwise it’s not a good answer. One of my favourite books is by Richard Nelson, who teaches at Columbia, about evolutionary economics. In that, he makes a distinction between what he calls “appreciative” theory and “formal” theory. What he means is that there is a theory that all economists agree to when they talk to one another about what goes on in markets, about entrepreneurship, about innovation.

Schumpeter uses the phrase “creative destruction”. For example, you have Tower Records, it does very well, then innovation comes in and eventually Tower Records goes out. We can tell the story about how markets operate in that way, and we can develop an appreciation for it. What we can’t do is put it in a model, and our formal, official theory is the modelling exercise. So there is this disjoint between the appreciative theory we can talk about, and the formal theory which limits what we can talk about to only those things that we can formally prove in a deductive model. Austrians aren’t challenging the appreciative theory of neo-classical economics. In fact they’re very much part of the neoclassical tradition. It’s just that the Austrians want to talk about things like dispersed knowledge, heterogeneity, uncertainty – not just risk, but real uncertainty – and institutions, how institutions arise to allow us to cope with our ignorance and our uncertainty and to ameliorate the frictions that exist in the world. Rather than seeing the frictions as the thing that destroys the model we have, or prima facie evidence that the market is not very efficient, they play a positive role.

Read the whole thing here.

Elsewhere in Reason: Hayek biographer Bruce Caldwell on Hayek’s enduring lessons about bad planning, distributed information, and the liberating power of choice, and Sheldon Richman on the left’s campaign to discredit the Austrian school.

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  • Tim||

    yawn.

  • yonemoto||

    terrible post. Should have been labelled "what's the best t-shirt about Austrian Economics?" Even picked the wrong one.

  • Old Mexican||

    Man, Economy and State

    One of the best introductions to Austrian Economics:
    Economics For Real People by Gene Callahan

    Good introduction for beginners and young students:

    Lessons For The Young Economist by Robert Murphy.

    The great thing is that these books are free to download.

  • EDG reppin' LBC||

    Robert Murphy is a wonderful writer, and a great example of writing about Austrian Economics. I find that his theses are always compelling, and his arguments are well crafted. His articles at Mises Daily are must read. Also a good writer over at Mises is Jeffrey Tucker.

  • ||

    It would be really nice if libertarian economists would just stay the hell away from normative economics. Can we please please keep the economics separate from the politics?

    Seriously, I've met self-described "Austrian Economists" at Ron Paul meetups who don't know what marginal utility is, how comparative advantage works, or even what that simple four variable equation is that they insist Keynes got wrong. But they real LRC and that's all that matters to them.

  • Hicks for newt ||

    i gots me a bible book...and gunz !

  • ||

    Incredibly OT stupidity

    Thus, every time a claim like "vaccination leads to autism" appears in our browser, that sentence would be marked in red—perhaps, also accompanied by a pop-up window advising us to check a more authoritative source. The trick here is to come up with a database of disputed claims that itself would correspond to the latest consensus in modern science

    Jesus Fucking Christ.

  • ||

    So, like when Tim Thomas suggests we should have a more limited government, that would be flagged as inappropriate, with a link to an Obama speech?

  • ||

    It's like, net neutrality, but for your thoughts. And the opposite.

  • ||

    The Fairness Doctrine writ large.

  • ||

    Pish-posh. Under President Santorum, the Federal Morality Chip implant will handle all of this pesky Internet filtering for you.

  • ||

    That's where I think this needs to go. Improve man, not technology. Just like Khan suggested.

  • Neu Mejican||

    A private corporation providing a voluntary (ignore if you want) rating of the content of a website is hardly tyranny, but I am not sure Google is the right arbiter of truth for all issues everywhere. Maybe the folks at Jeopardy should be in-charge instead.

  • El Commentariosa||

    What are some good Libertarian Documentaries? My friends don't have time to read.

  • yonemoto||

    if they're not libertarian, instruct them to watch the crash course by chris martenson.

  • ||

    Repo Man

  • killazontherun||

    Good one. My uncle's favorite. Retired now, but he was a private dick, bounty hunter and a repo man in his day.

  • El Commentariosa||

    What are some good Libertarian Documentaries? My friends don't have time to read.

  • ||

    Waco: The Rules of Engagement.

  • ||

    ^THIS^

  • ||

    Cool Hand Luke

  • Neu Mejican||

    Good choice.
    Also, Brazil.

  • ||

    In all seriousness, the most libertarian documentary of them all is Birth of a Nation.

  • o3||

    birth of a nation just shows a buncha dems riding around...before they burn stuff & vote obama!

  • ||

  • ||

    That and Anal Intruders 14, yes.

  • ||

    In all seriousness, what is your argument that BOAN is a libertarian document?

  • ||

    In all seriousness, I'm never in all seriousness.

  • Uncle Pfizer||

    dat's racist!

  • AlmightyJB||

    Just watch South Park

  • Jerry||

    Fat Head, Free to Choose, Mr. Conservative...Not libertarian but also of interest: Commanding Heights, The Fog of War, Operation Lune, The War Room.

  • killazontherun||

    Highly entertaining for a speech at a lectern.

    Keynesian Predictions vs. American History | Thomas E. Woods, Jr.

    http://www.youtube.com/watch?v=6XbG6aIUlog

  • AlmightyJB||

    How about a math book?

  • El Commentariosa||

    Econ 101 Textbook?

  • alten mexikanischen||

    I would suggest Old Mexican's Guide to Internet trolling: how to sound confident about economics despite your lack of understanding

  • shorter old mex||

    where da golds?

  • Bee Tagger||

    Do you mind if I use this for the final chapter of my book called The Guide to Internet Trolling Old Mexican and sounding confident about it despite your lack of understanding what he's saying

  • alten mexikanischen||

    That is one messed up sentence.

    You would also want to include his pamphlet. Old Mexican's Rants In Plain English: a reader's guide through tortured logic and idiosyncratic word usage.

  • Pot, meet kettle||

    That is one messed up sentence.


    Get out.

  • alten mexikanischen||

    If you order now, you can get Old Mexican's Guide to Logical Fallacies: who says they don't win arguments?

  • ||

    The scariest part of that story was the mention at the top that Greg Mankiw's Econ 10 class at Harvard walked out because he was teaching Adam Smith.

    Thank God they weren't teaching Leibniz in calculus class, they might have burned the campus down!

  • killazontherun||

    Holy mother of mercy. Who won the Cold War again?

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