Proving von Mises

There was another part I was thinking too, about giving stuff away for free, but I'm not about to wade through anymore searching. The first one took long enough. Try searching the word "free" in Human Action. It's pretty enlightening.

B-Ran wrote:There was another part I was thinking too, about giving stuff away for free, but I'm not about to wade through anymore searching. The first one took long enough. Try searching the word "free" in Human Action. It's pretty enlightening.

Probably similar to searching through the KJV of the Bible for "Thou".

Exactly.

By the way, one of the things I do disagree with LvM about is the entire idea of mathematical economics/empirical economics being unscientific. I would say that some of those economists who use those methodologies do so poorly: witness Roosevelt's or Carter's economic teams, for instance.

But it's important to understand that Neoclassical economics is as a rule not prescriptive. It's inductive, and unless you can accurately reproduce all the variables involved, not necessarily applicable.

B-Ran wrote:Exactly.

By the way, one of the things I do disagree with LvM about is the entire idea of mathematical economics/empirical economics being unscientific. I would say that some of those economists who use those methodologies do so poorly: witness Roosevelt's or Carter's economic teams, for instance.

But it's important to understand that Neoclassical economics is as a rule not prescriptive. It's inductive, and unless you can accurately reproduce all the variables involved, not necessarily applicable.

Which mathematical models would you say are scientific and fitting?

Those which through a process of thorough peer review and analysis turn out to be the more accurate. The "science" of neoclassical economics has been developing pretty consistently for the last century or so; those models which don't conform to reality are routinely discarded, and those that seem to be valid are never canonized to the point that they're considered some kind of absolute truth. That's the scientific method.

And, frankly, I'm wholly under qualified as far as neoclassicism goes, to discuss specifics. And I do think that at the time that HA was written, von Mises was completely correct about the state of economics. New developments especially centering around human choices and non-cardinal valuation have gone a long way in improving the models that neoclassical economists use nowadays. I mean, they did manage to predict the housing bubble four years ago.

B-Ran wrote:Those which through a process of thorough peer review and analysis turn out to be the more accurate. The "science" of neoclassical economics has been developing pretty consistently for the last century or so; those models which don't conform to reality are routinely discarded, and those that seem to be valid are never canonized to the point that they're considered some kind of absolute truth. That's the scientific method.

And, frankly, I'm wholly under qualified as far as neoclassicism goes, to discuss specifics. And I do think that at the time that HA was written, von Mises was completely correct about the state of economics. New developments especially centering around human choices and non-cardinal valuation have gone a long way in improving the models that neoclassical economists use nowadays. I mean, they did manage to predict the housing bubble four years ago.

Two things:

Yeah, I still contend that mathematical models are clunky and only applicable as an analogy. I would like to see something that shows me otherwise.

Just because some neoclassical economists predicted the housing bubble doesn't make their means of calculation correct. I have not seen the analysis from neoclassicals that predicted the bubble. I know that every Austrian Economist that I have read predicted the housing bubble.

Empirical science in general is clunky and only applicable as analogy, anyway. Right when we thought that Einstein was awesome because he dispelled 300 years of perfectly good Newtonian physics, it turns out that Einstein was wrong too. That's science for you.

B-Ran wrote:Empirical science in general is clunky and only applicable as analogy, anyway. Right when we thought that Einstein was awesome because he dispelled 300 years of perfectly good Newtonian physics, it turns out that Einstein was wrong too. That's science for you.

Einstein actually was so precise with his equations that it blew people's minds. His time dilation, length contraction, and mass variation equations in his theory of relativity were precise.

Regardless, economic equations have utterly failed and will continue to because economics is the study of human action, which is not able to be defined by a graph.

Einstein's relativity theorems were stunningly coherent, which is different that being stunningly right. Relativity was more a leap of intuition coupled with a unique way of looking at the problems at hand, but when Einstein started his relativity project, there were no such things as particle accelerators, or, heck, even lasers. His equations were brilliant because he recognized intuitively the defects in the Newtonian model. No one had ever even thought of physics the way that Einstein did.

But some of his equations are dubious; they rely more on implication than observation. As particle physics advances, we are coming closer and closer to the Holy Grail, a unified field theory, but we might never find it. It might not even exist.

Wow, what a tangent, right?

B-Ran wrote:Einstein's relativity theorems were stunningly coherent, which is different that being stunningly right. Relativity was more a leap of intuition coupled with a unique way of looking at the problems at hand, but when Einstein started his relativity project, there were no such things as particle accelerators, or, heck, even lasers. His equations were brilliant because he recognized intuitively the defects in the Newtonian model. No one had ever even thought of physics the way that Einstein did.

But some of his equations are dubious; they rely more on implication than observation. As particle physics advances, we are coming closer and closer to the Holy Grail, a theory of General Relativity as Einstein called it, but we might never find it. It might not even exist.

Wow, what a tangent, right?

No, Einstein's theories have passed tests remarkably and have proven to be right on.

For example:

"Einstein's theory of General Relativity has been around for 93 years, and it just keeps hanging in there. With advances in technology has come the ability to put the theory under some scrutiny. Recently, taking advantage of a unique cosmic coincidence, as well as a pretty darn good telescope, astronomers looked at the strong gravity from a pair of superdense neutron stars and measured an effect predicted by General Relativity. The theory came through with flying colors." -http://www.universetoday.com/2008/07/03/theory-of-relativity-passes-another-test/

"Einstein's relativity theory proven with the 'lead' of a pencil"http://www.eurekalert.org/pub_releases/2005-11/uom-ert110705.php

Einstein's theory of relativity regarding time dilation is tested - http://www.cosmosmagazine.com/news/1695/einstein-still-right-time

Just a few.

Well, they've proven to be internally consistent. But that may just be because we don't have the language to describe what is actually happening any better. After all, Newton lasted 300 years before anyone figured out the flaws in his ideas.

Heck, we don't even know why objects have mass at this point. We can imagine the Higgs boson, but is it really there?

Also, check out this discussion. As much as I hate to admit it, I am a physics junkie even though I hate math.

So, yes, gravitation does cause an “effect” in atomic clocks. You can call it a “mechanical” effect, or an “electrodynamical” effect, or whatever you want to call it. It is a physical effect caused by a gravitational “force” being placed on the atoms. But this is not “time dilation”, its an “atomic harmonic oscillation rate slowdown”.

This is something I've been trying to tell people for years.

B-Ran wrote:Well, they've proven to be internally consistent. But that may just be because we don't have the language to describe what is actually happening any better. After all, Newton lasted 300 years before anyone figured out the flaws in his ideas.

No, you are not understanding the precision that Einstein has calculated things like time dilation and length contraction. For example, they have taken all kinds of clocks (atomic clocks being the most recent) and sped them up. Einstein did not only predict that the time would slow for the object that is accelerating, but he calculated the exact amount the time would slow as compared to the amount of acceleration. That is one of many calculations that he was spot on with, and he wasn't able to test them at the time. Only later have we had the technology to test his theories and calculations. His calculations have proven right through repeated experimentation. The precision and accuracy that Einstein projected, was uncanny and unbelievable to be anything but right.

Einstein believed in a static universe. That was wrong.

He did correct himself later (in the face of evidence that showed him to be completely wrong), but it shows that man was not infallible.

B-Ran wrote:He did correct himself later (in the face of evidence that showed him to be completely wrong), but it shows that man was not infallible.

He was definitely not infallible. However, his theories of relativity have been more accurate than anyone could have imagined.

I don't know how this turned into a physics thread.

Anyway, the speed of light was defined as a constant by Einstein because it was convenient since you need a constant. But speed of light is only a constant when in a vacuum. And the vacuum of space may or may not exist. We have no way of knowing, because we can't be conversant in an unknown that we don't know about. If I could read you every word in English, you could say I knew every word in the world if you didn't realize there was Spanish.

The metre is the length of the path travelled by light in vacuum during a time interval of 1/299,792,458 of a second. The second is the duration of 9,192,631,770 periods of the radiation corresponding to the transition between the two hyperfine levels of the ground state of the caesium-133 atom.

But then again, time doesn't exist, so what have we learned? And besides, have no way of observing the speed of light accurately enough to know whether we're even right. Weeeeee!

Okay, well, after reading a lot of Mendel Sachs, I've come to the conclusion that most people are just wrong about Einstein, rather than Einstein being wrong about most things...

http://www.compukol.com/cgi-bin/forum/Blah.pl?

Mendel Sachs, I am convinced, is the Ludwig von Mises of physics. Seriously. Read everything there. The guy is a freaking genius.

B-Ran wrote:Empirical science in general is clunky and only applicable as analogy, anyway. Right when we thought that Einstein was awesome because he dispelled 300 years of perfectly good Newtonian physics, it turns out that Einstein was wrong too. That's science for you.

Since we have such a limited grasp on how the economy works, we should realize that it cannot be planned effectively by a group of people. This is one of the huge benefits of the free-market... it requires no planning besides the planning for the protection of property rights from the government. Other than that, the free market can run itself and keep itself in check by people simply acting in a way that is according to their interests.

What makes the information available to a large corporation any different than the information available to a government?

B-Ran wrote:What makes the information available to a large corporation any different than the information available to a government?

The information that is available is not much different in most cases. The key differences are that companies live and die by their successes or failures. Government programs do not. Companies have competition and the potential of additional competition to worry about if they fail to meet their customer's needs. Government does not. Companies have motivation for profit, which involves cutting inefficient and unnecessary costs and meeting a customer's needs more totally. Government does not. Companies have to work within the confines of voluntary exchange. Government does not.

However, comparing and contrasting companies vs. the government is not a good free-market vs. interventionalist comparison. A better question would be, "What makes the information available to a consumer any different than the information available to a government?" Since each person values different things differently, only the individual can know what they value the most. Government is wildly arbitrary and innacurate at meeting the diverse wants/needs of society.

Edited.

Then why is a government less able to make decisions than a large corporation, given the same information?

B-Ran wrote:Then why is a government less able to make decisions than a large corporation, given the same information?

The information that is available is not much different in most cases. The key differences are that companies live and die by their successes or failures. Government programs do not. Companies have competition and the potential of additional competition to worry about if they fail to meet their customer's needs. Government does not. Companies have motivation for profit, which involves cutting inefficient and unnecessary costs and meeting a customer's needs more totally. Government does not. Companies have to work within the confines of voluntary exchange. Government does not.

However, comparing and contrasting companies vs. the government is not a good free-market vs. interventionalist comparison. A better question would be, "What makes the information available to a consumer any different than the information available to a government?" because consumers are sovereign in the free-market while government is sovereign in planned economies. Since each person values different things differently, only the individual can know what they value the most. Government is wildly arbitrary and innacurate at meeting the diverse wants/needs of the individuals governed.

What about democracy?

More to the point, are we not as citizens of our society, consumers of our government? Are we not entitled to make decisions about the way we want our government to be based solely on our own interests? If not, why not?

B-Ran wrote:What about democracy?

More to the point, are we not as citizens of our society, consumers of our government? Are we not entitled to make decisions about the way we want our government to be based solely on our own interests? If not, why not?

No, we are not consumers of our government the way that we are consumers of anything else. The government is courting us for our business and we can't choose a different government.

Democracy does nothing to solve the problem that government is unable to meet the needs/wants of the consumer even close to what the free market can do.

"Ludwig von Mises provided the first full account for why this is so. The government exists outside the matrix of exchange. There are no market prices for the goods and services it endeavors to produce. The revenue it receives is not a reward for social service but rather money extracted from the public by force. It is not spent with an eye to return on investment. As a result there is no means for the government to calculate its own profits and losses. Its inability to calculate with attention to economic rationality is the downfall of governments everywhere. Its decision-making is ultimately economically arbitrary and politically motivated." -Lew Rockwell