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That was a nice return of serve by Laver.

Someone on the radio over here said that this win confirms Federer's place as the greatest player of all time. What does that tell us about Andy Roddick?

Sure nuff.

Although if you had to objectively state who the greatest economist of the last century is you would obviously have to say Keynes.

Blogs are so interactive where we get lots of informative on any topics nice job keep it up !!


FOr someone running a dissertation writing help "service", we expect you to make a better comment than the 1 sentence you managed to compose.

My writing skills are primitive, but I am not a "writing helper".


We have this disagreement a lot, but let me reiterate my view since (in your post) you seem baffled as to how anyone could possibly disagree with you. (You use terms like "silly right?!" and "should be as clear as day.")

For most of your post, it seemed you were limiting your remarks to success as a professional economist. And yes, it's certainly true that if you want to compete against all other professional economists, then you try to get published in the top professional journals. No argument there.

But then you switched from talking about career success and turned it into a search for truth:

Don't publish exclusively with in-house journals, blogs, vanity presses, and expect to be recognized as contributing to the scientific literature. Don't fool yourself, and don't let anyone who only does that sort of intellectual activity fool you either. If you do that you are only competing in the "local club championship", and while winning those tournaments might be fun as an amateur, it is not what you do if you are a professional economist that aspires to track truth and advances economic science."

I don't think it's self-evidently silly or as clear as day that the best way to "track truth" is to try to get published in the top 10 economics journals. Look, Paul Samuelson hands down has been a more successful professional economist than any Austrian. (I was going to compare him to Jordan, and then Kirzner to John Stockton, but that would be off. Most American basketball fans have HEARD of John Stockton, whereas most economists probably don't know who Israel Kirzner is.)

Now maybe the best way to advance economic science is through the mainstream journals, or maybe the best way is to publish in in-house journals (a la the Public Choice school). I don't think the tradeoff is as obvious as you are implying in this post.


Public Choice is NOT an in-house journal, it was at its peak a top 25 journal in the social sciences and is today still in the top 50 or 60 journals.

I ask you to look at Mises's bibliography up to the age of 60 and compare that to Rothbard's bibliography up to the age of 60. Both are extremely productive, but Mises produced in much higher profile professional and public outlets. Mises was the more important economic scientist, and he was recognized as such by his contemporaries. Shouldn't we recognize this? Mises was the Distinguished Fellow of the AEA and he also received the Austrian Medal for his contributions to economic science --- one of the highest honors an Austrian citizen can earn in my understanding.

See my point --- Mises and Hayek were men of accomplishment and we should praise that rather than claiming that they were ignored. Israel Kirzner IS a recognized name -- again read NYU's announcement of Kirzner being honored with the FSF-Nutek Award, or the fact that it was Kirzner who the JEL went to for the survey on Austrian economics and entrepreneurship, or that he wrote the entry on the Austrian school for the New Palgrave, etc.

Recognition is NOT what we strive for, we strive for truth, but recognition reflects that we are making headway in getting others to pay attention to the truth that matters.

Now if you follow the logic of my position, it does not say that economic journalism is bad, just that if you are going to be an economic journalist you want to do the job so well that you are recognized as a leading economic journalist --- which might be reflected in publishing in the highest profile publishers and having your work published by major presses; if you are a policy wonk, then again nothing wrong with it, but you would aspire to have your policy studies published by the leading "think tanks" and read by critical decision makers and influence the policy discussion; and if you are an economic scientist then you would want to have your work published in the best journals and read by the best minds in economics and considered to possess valuable insights by them (even if they disagree).

Not everyone can achieve "grand slam" fame in the profession of economics, but we should NEVER confuse good amateur play with professional accomplishment, just we don't expect the club champion at the Fairfax Racquet Club to win the US Open next month -- even though he is probably a really good player by any reasonable standard of amateur.

My post is about advancing economic SCIENCE, which presumably is what aspiring PhD students want to do (otherwise earning a PhD I would argue is an overinvestment in human capital).

And unfortunately I still don't see how you can reasonably object to what I am saying given the limits within which I am making my argument. Unless you are willing to claim that in the modern context a newspaper or public intellectual will break through and make a fundamental contribution to the science of economics (like the club champ at your local club winning Wimbledon next year). To me that is a hard position to hold.

On the other hand, do I think a lot of bad stuff gets done in economics -- yes. But I actually think a lower percentage of pure junk gets done in economic science than in economic popularizing --- where the percentage of junk is VERY high (think Naomi Klein). I understand what Mises meant when he said about Lange and Lerner --- at least they are economist. There is a certain rigor to the argument and quality of the argument that must be appreciated even when you disagree with its conclusions that I fear so many of the young minds attracted to Austrian economics are being taught to not appreciate.

Anyway, I was going to write to you earlier today about your Mises post on Christina Romer and the 1937 crisis and congratulate you on the great job you did. But in the context of this discussion, think about what it would take for you to take your very good economic analysis and turn it into a piece that could be placed in the Journal of Economic History. The piece as currently written has a very good readership of laypeople and economic instructors like me that will use the piece and teach from it, but imagine the influence you could have on your peers if you made your point in a way that could pass the "test" at JEH and change the way individual scientists think about the Great Depression and fiscal policy. You know I am not asking for something impossible -- look at Bob Higgs's work that has been published in JEH.
I am very concerned about the legacy of Mises in particular --- similar to the way you talk about Kirzner's concerns in your review which discusses his paper The Misesian Legacy.

Keep up the great work, I am just encouraging you to use your considerable talents as an economist to get your work not only in the hands of a loyal lay audience, but to challenge your professional peers to rethink their positions.


Didn´t Public Choice _start_ as an in-house journal? And what about The Journal of Law and Economics for instance? Was it already a top journal at the time Coase wrote his first papers in it?
Are there any other journals that started as relatively obscure and later became more important?
But I am afraid, the more I think about it, that Pete is generally right. Austrians should give it a try more often.


I'll post one more time, since you are still dead sure that you can't possibly be wrong on this. :) But after that I will stop, because I don't want to contribute to the unfortunate Auburn/Fairfax flame-ups.

First, just as you are bending over backwards to make sure I don't take personal insult at what you are posting, by the same token, I am not at all implying that you are wasting your time at GMU, and that everybody should drop out and start blogging full-time. Of course I'm not saying that. I couldn't believe Leeson got an anarchy article in a Chicago journal, and I told him that at the time; I'm still amazed. (And maybe part of your point is, I shouldn't be amazed, a la Luke Skywalker's "I don't believe it!" and Yoda's "That is why you failed.")

But OK, now that the kissing and hugging is out of the way, let me summarize the basic contradiction I perceive in your latest post: ON YOUR OWN TERMS, why in the world would you tell your current students to study the CVs of Mises or Rothbard? They are not the analogs of Federer. Instead, you should tell them to study the CVs of Keynes, Paul Samuelson, Kenneth Arrow, and maybe Milton Friedman and Robert Lucas, if you want to include some free market types. But no way would you stoop down and include Austrians; it's not even close in terms of professional accomplishments.

Whatever your reply is to that challenge, then realize it's just a matter of degree. You would presumably say something like, "Well, I want to tell my students to emulate professional economists who were successful *and practiced what I consider to be good economics*."

And thus we see that, despite your protestations to the contrary, you actually don't adhere to "professional success" as the measure of an economist. That's good, neither do I. But yet you constantly write blog posts saying that you DO think the measure of an economist is what everyone at MIT thinks of him or her.

The history of the journal is different than its current placement. In both cases of Public Choice and JLE, they were in-house journals of a sort, but they were always committed to a wider audience and also to very high standards of argument. In short, both based on their reputation became leading journals. JLE is now one of the best outlets a scholar in the social sciences can publish in.

It is not an issue of trying harder in most cases, it is in fact an issue of trying at all. Again, just spend 10 minutes at EconLit and plug in all the contemporary names and look at their publication productivity (in the crudest sense of that measure) and then compare it to any of the recent JB Clark Award winners, or just limit the comparison to free market guys who have won the Nobel Prize.

"...why in the world would you tell your current students to study the CVs of Mises or Rothbard? They are not the analogs of Federer. Instead, you should tell them to study the CVs of Keynes, Paul Samuelson, Kenneth Arrow..."

In the days that Mises was in his forties and fifties, the 1920s and 1930s, I think that I can guess that he was as big (at least in the german speaking world) as Acemoglu and Shleifer are today. Hayek is big even today, but not in technical economics as he was in the 30's, but on the more "soft" side of the science (with can influence the profession, in a more indirect way).


I am completely sincere in my question to you about your piece today. I am thrilled with your effort today to set the record straight and I find your argument convincing. I would like to see that interpretation become the dominant one among economic historians of the period. So what I would like to see the best and the brightest do in Austrian economics is take the brilliant intuition and translate into a form that can get a hearing among the readers not just of the blog, but in the JEH.

Please do note that my argument is not about "professional success" per se, but professional success with the caveat of advancing the ideas we find to be true for those of us convinced about the Austrian school tradition.


That is right, that is my opinion and the reason I cited the awards. Keep in mind that when Human Action was published it was reviewed in the NYT --- how many books get that sort of coverage as economics books.

As I said, look at his CV up to 1945 and compare that with Rothbard's CV as compiled by David Gordon. It is a very interesting comparison, when you break down the outlets in which they published their work.

Mises was considered a leading economic thinker in the 20th century even by those who vehemently disagreed with him. Jacob Viner supposedly once argued that if you judged a professor by the insights of their former students Mises would have to rank as one of the leading economics professors of the first half of the 20th century. Mises was justly named the Distinguished Fellow of the AEA, and earned the Austrian Medal for his achievements, and he earned multiple honorary degrees. It is a mistake to keep insisting that he was a disregarded genius who nobody knew and who could not get published because of the discrimination, etc.

No, Mises was an outstanding economic thinker, recognized as such by his peers, who published his books with leading publishers, his articles in top journals in economics, political science and even philosophy, and published his popular work in the leading periodicals (German language) of the time.

Hayek, of course, pushed even further into the establishment of economic science.

All I have ever said is that we would do well to imitate these great scientists and work to build a culture of excellence. BTW, look at Mises's own description of his seminar in economic theory from Vienna --- debate and discussion where he was one among peers.

I think there is also an important issue concerning the quality of work being done today in Austrian economics, especially when it is compared to the contributions of Hayek and Mises. I will try to express my opinion as delicately as possible, but I do also want to get my point across, so here goes: What have been the great contributions of the current generation of Austrian economists? There is no question that they understand the literature thoroughly. I have learned a great deal from them, but they haven't really contributed anything new or innovative. At best, they are great synthesizers. Horwitz has done a good job in synthesizing the Austrian literature and monetary equlibrium, and Caldwell has been great in summarizing the teachings of Hayek. But these guys are nothing like Hayek and Mises. I think academic standards are partly to blame. For example, older economists like Mises and Hayek never had to worry about references or covering their ground. When you read journals today, 3/4ths of the journal article is spent summarizing the arguments in the literature with which the paper is concerned, and the last 1/4th contributes something negligibly new (at least in the Austrian articles I have read --- and I have read many). The older literature never did that. They were forecefully argued, and the tone was bold and direct. Today, it is not like that at all.

So I suppose the current Austrian generation is only partly to blame. Let's take Boettke for example. What is his best paper? Probably the What is wrong with Economics paper published in Critical Review? That entire paper is really just a recapitulation and clarification of Hayek's argument. I know I am going to be personally attacked for this view, but I am convinced it is true.

So the question for me is not so much where are Austrians publishing today, as what they are arguing, regardless of where it is published. Here is a question: Would you rather have a Boettke paper in AER, or a Hayek-like paper in QJAE?


I was thinking of something to add to this post, but I think Dr. Boettke summed it up perfectly.

The best I could come up with is that I would regard Murray Rothbard as the economist counterpart to Lleyton Hewitt. Neither were very technically good, both are enjoyable to watch/read, both are full of energy, both were somewhat tempermental and both were short.

FWIW, basically every reputable general journal (QJE, JPE, Economica, etc) began as an in-house journal. The sole exceptions are the AEA journals and the more recent "society" and trade journals.


That isn't a bad question. First, the answer should be a Hayek quality article in the AER so it is on the reading list of every graduate core course in the country. Second, I NEVER claimed to be even good enough to tie Mises and Hayek's shoes. All I am trying to do is communicate their ideas as I understand them to the current generation of economists and to the world out the window to make sense of our world to my students. Mises and Hayek were true innovators in the science. Third, I would not say that my CR paper is my best paper, though I like that paper, I would say that my most innovative paper was my "Why Cultural Matters" paper, but it didn't really work, so a restructuring of that paper was published in AJES last year (with Chris and Pete) focusing on "Institutional Stickiness", but I also think my papers on "F. A. Hayek as an Intellectual Historian" and "Why Read the Classics" are good essays explaining why history of thought is important for contemporary economic theorizing. Finally, I think my work in comparative wasn't bad --- including my essay on Economic Calculation: The Austrian Contribution to 20th Century Political Economy, and my economic history work on the origins of the Soviet Economic system.

But again, let me reiterate so that nobody gets the wrong impression, I consider my own career to be a failure. I was denied tenure at NYU, I earned a post at the Hoover Institution but wasn't retained permanently, I have been a visitor at LSE twice, but didn't land a full time offer, etc. My best publication rank wise is part of symposium in the Econ Journal, but I have never hit the big 3 of JPE, AER, QJE. But I know what the standards are to succeed at the elite levels (the way Mises and Hayek did), even if I failed to meet those standards.

Put this another way, there is NO economic thinker meeting the standards met by Mises and Hayek that is not publishing in top journals or teaching in PhD programs. The next Mises and Hayek will not come from outside of those ranks, to suggest so is to misunderstand what Mises and Hayek achieved in their careers.

One final point, your point about references in Mises and Hayek, and the arguments of the day, is a rather strange assessment. Mises in Theory of Money and Credit, Socialism, and Epistemological Problems is deeply connected to the literature and one can follow that discussion both in the text and in his footnotes. Hayek in his technical work in monetary theory and capital theory, as well as his more philosophical essays published later such as those collected in Studies and New Studies reflect a deep commitment to scholarship and to a deep engagement with the literature. So I am not sure what you want to argue here about not contextualizing one's argument.

But I think you are asking a very good question, we need to attract to Austrian economics minds that are of the level of Mises and Hayek. I am not there, but I sure hope I get the opportunity to teach a few in my lifetime. In the meantime, I will continue to plod away doing the best I can with the limited abilities I have. To go back to my tennis analogy, Brad Gilbert is a pretty good commentator even though he was mainly known during his professional tour days as "winning ugly". That is what I am hoping to achieve. Still trying to reach the winning ugly level -- not there yet.



A question of an empirical nature --- what was the last in-house journals that became a famous outlet down the road? And when was it first published?

REStud was a student journal in the 1930s, JPE (Chicago), QJE (Harvard) and Econ Journal (Royal Society) where started I believe in the 19th century. So what journal would you list from the 20th century?

Well Mr. Boettke isn't there something second-rate and improper about serving exclusively as an expositor of someone else's ideas? The goal is to develop original ideas, not to continually reiterate the ideas of someone else. You see, when I read someone I like, I want to challenge their argument, and look for ways to undermine and subvert it. That is what I have done with Menger and Mises, and I think I am all the better for it. Now, of course, our first task should be to get students to *actually* read these guys, but once that is achieved, it seems silly to encourage these same students to follow your lead in serving exclusively as spokesmen for Mises, Hayek and libertarian political economy. We have to push the frontiers of Austrian economics. And it will be hard. New ideas are always rejected because, as Samuel Johnson said, the innovator "appeals to judges prepossessed by passions and corrupted by prejudices, which preclude their approbation of any new performance." But what would be the state of Austrian economics if people like Menger and Mises failed to pursue their own creative energies?

Oh, and let me anticipate your response by stating that what people like Leeson and Coyne are doing is NOT new and original. Their work is purely *application* of conventional Austrian/public choice wisdom. That does not mean their work is not interesting for people interested in this field of research, or that their work is mature and informed; it just means that it is not new. It is application and synthesis. It is important for people to read this stuff in order to better understand what Austrian economics is about, but there comes a time in a young student's intellectual development when he must challenge and attack received wisdom. That is what it's all about.

...."or that their work is NOT mature and informed" .... (sorry, I needed to correct that).


You have to have skills as an intellectual to do economics that you are not accounting for. When I was young I also thought I would re-write all of economics. I learned that was foolish. Perhaps you will not learn that. All power to you IF you do that. But that is not as easy as you are thinking it is. First, you need to get your PhD. In order to do that you have to get admitted to a PhD program. Second, you have to actually write arguments, not just scattered disjointed notes. Third, your reading has to be plausible, not just made up or reflecting a complete misunderstanding of an author. Fourth, you will need to get your arguments published.

So I think you are a FAR WAY AWAY from undermining and subverting Menger and Mises. Right now, you are not even at the first stage of the process. You have not done anything yet.

And you are not reading my position at all charitably. You went from economics to libertarianism in less than a minute -- I never even mentioned libertarianism. You also talk about me being "second rate" and "improper" --- in what sense? I never said I was "first rate" and I believe there is truth in economic argument and that communicating that truth is vital -- so no I don't think I am behaving improperly as a teacher/scholar.

I do push the frontiers all the time of Austrian economics through cross fertilization with other thinkers in economics and other disciplines. This work is synthesis, but the synthesis does mean a new twist.

Pursuing one's creative energies is what I hope to encourage in my students. But also disciplined by the rigors of argument and the discipline of economics. Learn economics first, study hard, and master the discipline.

I have mentioned this to you before, but I really think you could benefit from reading Polanyi's The Republic of Science. Or Kuhn's The Essential Tension. Both accounts of science entail conservative and revolutionary elements.

I still hope you will decide to pursue a more disciplined path, and perhaps then your creative energies would actually be directed in a productive manner rather than going down a path which means that your only outlet will be vast wasteland of blogs and internet chat groups.


The law and economics journals at Chicago (Legal Studies, etc.) come first to mind for me. Public Choice is another good example from the last 50 years, as is the RAND Journal.

My point was that to disparage a journal for an "in house" status is to miss your point. Heck, essentially all of the law journals are "in house."

Well, in that case I can admit failure as an academic like you just did, and try to inspire students more qualified than myself in following my intellectual approach and developing (and publishing) my ideas. You're right: all I have are notes, lots and lots of notes. I cannot write academic papers. I have notebooks full of notes containing good arguments, but I cannot write them up. For those students reading this, here is an example of a radical way of attacking Menger and subjective value. I think this is a quality argument, and I have written to many top Austrian scholars, but have yet to receive ANY response, not because they don't want to discuss it, but because they don't know how! I will reproduce the email I wrote to Bob Murphy in response to a daily article he wrote on the Mises site doing ... you guessed it! ... reiterating the conventional view of Menger's work:

Hello Professor Murphy,

I was encouraged by your question concerning my interpretation of the marginalist revolution.

The idea is as follows.

1.) It is true that value emerges from the needs of individuals. Individual needs create the conditions required for value's emerence.

2.) But the determination of value does not look to subjectivism. Although the creation of value depends on subjectivism, its quanitifiable determination does not; instead it looks to the quantities of goods in existence.

3.) Therefore, value is determined objectively (quantities of goods) and not subjectively (intensity of needs). Menger gives a good example of this. He describes three situations in which members of a ship face three different quantities of biscuits. In the first case (abundance of biscuits), there is no value placed on an individual biscuit. In the third case (scarcity of biscuits), each unit of biscuit has immense value. Then he concludes, quite remarkably, that these individuals did not experience any change in their needs, and yet value changed! How can this be? It is the quantity of goods (objectively determined) that determines value, not subjective needs. Subjectivism only determines which goods will be selected as objects of valuation. It is the objective quantitty of goods in existence that determines its value.

Here is another example. At the Mises blog, someone quotes you by writing:

"Marginality is a valid concept but it is important to stress 'frame of reference'.
For example Robert Murphy does a good job with his
man on a desert island model, each sack of grain having decreasing utility as they are less urgently needed.
But one day a cruise ship rescues the man.Now each sack of grain has the same marginal utility (ie zero) as as the ships' endless buffets make sacks of dirty old grain look pathetic.
Of course such an abrupt change in the frame of reference is not too common, they are usually more
mild,this is what is confusing your Recardian opponents."

Now, why did the value of each sack of grain change? It is not because subjective needs changes, but because the quantity of goods changed. Would you agree??

This is why I argue that the marginalist revolution is opposed to subjectivism. What a claim!!!

Anyway, I would like to hear your thoughts on this. I am thinking about writing this up as a paper. Any comments would be greatly appreciated. Thanks,

Matthew Mueller

.... Now, I am unable to write this up into a paper, but I would love for some PHD!!! student to do so, because that is the only way Boettke and others will read it!!!

For an academic Matt, I think the words of James Buchanan and Richard Wagner are wise and perhaps the best ones that might help you sort this out.

Thinking without writing is daydreaming

Talking without writing is just bullshitting

So Matt, learn to write an economic argument. But you will not learn that until you go to graduate school.

And Matt, now I will sound obnoxious --- I can state I failed because I tried and didn't achieve. You didn't fail, you never tried. I climbed the academic ladder from GCC to GMU to NYU (and to Stanford and LSE) and I just fell back to GMU. You haven't climbed at all.

So climb the ladder. Go to school as a start.

To go back to the original post, I got to play at Wimbledon, French Open, US Open, and Australia. Unfortunately, I didn't get as far as I would have liked. But I am still playing in professional tournaments (I teach in a PhD granting institution that has a world-wide reputation). But you haven't even gotten past the local junior tournaments in St. Louis. Again, go to school so you might be able to see how well you actually can play. Otherwise you are just being a jokester.

Also, you underestimate the originality in Leeson and Coyne so I would like to know if you have actually read their work. I also think this is a function of that fact that since you have not had the opportunity to study economics in depth, you have no idea what it takes to actually write a real economic article or book. If you did, you would realize just how absurd you are being in claiming that you are pushing out frontiers with notebooks filled with jibberish.

Ok, I will keep this short:

1.) Before you call my ideas jibberish, I would like to see you address the arguments I have made, here on the blog and in personal emails. This "get a PHD first and then we'll talk" response is getting on my nerves.

2.) Leeson and Coyne are not original, they are just very good at applying and synthesizing received wisdom.

3.) I understand economics, and enjoy studying it, but I just don't like being formally trained in it. I graduated from a school you can only dream about. So let's get that clear. And let ME be obnoxious for a moment: These debates over whether Hillsdale or Grove City College is better sounds childish to a WASH U graduate. (:

There is nothing new here. Subjective preferences and an objective quantity of existing resources. So what? Every reader of your comment knows this. My interpretation is that AE is more subjectivist than neoclassical subjectivism (preferences, knowledge, and expectations, rather than just preferences), but this does not imply that everything everywhere is always subjective.

Not being able to write up something into a paper? I would never tolerate this argument from my students, some of which have problems with English as well as theory. Students start out by writing bad papers, and then sometimes -- with much practice and much reading -- they gradually improve their writing skills, as well as their ability to structure thoughts and their familiarity with the literature.

Hello David,

Well, you have to understand the implications of this interpretation. Accepting the argument that value is *created* by subjectivism but *determined* by objectivism undermines the entire Austrian research program. It also suggests that every Austrian scholar (including Hayek and Mises) had Menger wrong. Lachmann hinted at this in an essay collected in the Lavoie edited book, but he didn't go far enough. And Kirzner missed the boat in his attempt at correcting Menger in that essay collected in that purple book with the ship printed on the cover. That is my argument. By Menger's own reasoning: value is DETERMINED objectively.

If you have a PHD, could you please write to Mr. Boettke and see what he thinks of the argument?

Matt Mueller couldn't get a PhD and he knows it. That's why he comes on here spouting off like he is some radical.

Give it a rest Matt, it just isn't interesting or amusing anymore. Leave this blog to people who understand AE or want to get a better understanding of it. Go somewhere else.

Oh and Matt, before you come back saying crap like "I just couldn't fit within academia because I am such a free thinker, you have to conform, I am such a martyr etc", please don't. It's boring bullshit.

Matt - do you know the difference between price and value?


First, as David argues the idea of subjective valuation interacting with objective reality is not new in the least to Austrian economists. See Rothbard's discussion here ---

Second, getting a BA from an elite school (Harvard, Princeton, etc.) let alone a good school (Wash U) doesn't qualify you as knowing economics, unless you are able to express what you have learned in a manner which others can understand. For example, to put things in perspective look at someone like Glen Weyl -- I actually had Glen come in a give a paper to our workshop at GMU.

Third, nobody here every debated that GCC or Hillsdale was better than Wash U --- the comparison never came up. Wash U is a totally different type of school. GCC and Hillsdale are small colleges that give a very hands on education to their students. I benefited greatly from my time there, and I owe most of my subsequent career to the education I received there under the supervision of Dr. Hans Sennholz. Sennholz actually taught a graduate seminar for students that were studying under him through the International University. These were students from Argentina, France, and US during my time. I was invited to be part of his seminar as the only undergraduate starting in my junior year. I was way behind the curve compared to the others so I often was lost and struggled to keep up. It was a great experience for me --- though Sennholz's notion of learning economics was more intense history of thought rather than technical modeling.

Matt seriously --- according to your own account you alienated your teachers at Wash U, you didn't get along with the professors at UMKC, and you have alienated yourself from Austrian economists. That means that neoclassical/NIE; Post Keynesian and Heterodox economists; and Austrian economists have been communities that you have tried to circulate in and you have found the experience unpleasant. At what point do you look in the mirror and say to yourself, something I am doing isn't right?

I view blogging as an extension of my classroom. I am really trying to be patient with you, but you do test that patience. And when I use a term like gibberish, it is because your statements are in fact that --- they literally don't make sense. And I think this is why you have found the reaction you have across paradigms in economics. Think about that --- you have tried to talk to NIE types and they have kicked you out of the office (your report not mine), you have tried to talk to Post Keynesians and they have pushed you away (your report not mine), and you get upset when Austrian economists don't engage you as you would like.

At one point you said you were going to go earn a graduate degree in literature, but that plan has be put aside as well. BTW, there is an academic discipline focusing on economics and literature --- see Catherine Labio (she was a student at NYU in comparative literature but worked as an RA in economics). It is often dominated by post-modern typers. There are also cultural studies PhD programs.

I guess that the problem is a very simple one:

Any layman in tennis can be capable of knowing who's the best tennis player by looking at the Grand Slam results and ATP rankings...

But no layman, and even professional economists can know who's the Federer in economics by looking at Nobel Prizes and other Academia awards... The mainstream prizes are for mainstream economics, or for mainstream ideology somehow related at the moment...

Professor Boettke,

I like your attitude; you want to take the fight to the opposition, so to speak. I am young, impressionable, foolish, and easily inspired by these kind of words. (I am also inspired by mgm's challenge to do something new).

I want to take up your challenge, and might even come to GMU to do it.

My problem right now is the absence of any community of like-minded people to engage with, so my motivation waxes and wanes. I need to discuss and argue ideas with people who can challenge me, and I have rarely found that in my life. I must seek it out, and perhaps GMU would be a good place to find it.


I second David's take, if one of my students submitted your points as an explanation of value, I would be inclined to fail them but probably award them a C for trying.

Obviously subjectivism has no role in your model, you never deal with multiple people, let alone a market setting. Seriously, look back at what you wrote:

"1.) It is true that value emerges from the needs of individuals. Individual needs create the conditions required for value's emergence.

2.) But the determination of value does not look to subjectivism. Although the creation of value depends on subjectivism, its quanitifiable determination does not; instead it looks to the quantities of goods in existence.

3.) Therefore, value is determined objectively (quantities of goods) and not subjectively (intensity of needs). Menger gives a good example of this. He describes three situations in which members of a ship face three different quantities of biscuits. In the first case (abundance of biscuits), there is no value placed on an individual biscuit. In the third case (scarcity of biscuits), each unit of biscuit has immense value. Then he concludes, quite remarkably, that these individuals did not experience any change in their needs, and yet value changed! How can this be? It is the quantity of goods (objectively determined) that determines value, not subjective needs. Subjectivism only determines which goods will be selected as objects of valuation. It is the objective quantitty of goods in existence that determines its value."

Yes you say "members" of a ship but the case would be no different for Crusoe on an island. All your doing in this example is re-stating diminishing marginal value for an individual. In a larger population, in order for the stock of goods to be distributed though buying and selling, subjectivism would have to play a role as some may value the good - and be willing to pay more than others - thus bidding up the price.

But even in the solitary case, subjectivism still plays a role at point (1), Crusoe chooses to do what Crusoe wants to do based on his own subjective preferences.

Your response to David is where I think Pete is reasonable to use the phrase jibberish. You wrote:

"Accepting the argument that value is *created* by subjectivism but *determined* by objectivism undermines the entire Austrian research program. It also suggests that every Austrian scholar (including Hayek and Mises) had Menger wrong. Lachmann hinted at this in an essay collected in the Lavoie edited book, but he didn't go far enough. And Kirzner missed the boat in his attempt at correcting Menger in that essay collected in that purple book with the ship printed on the cover. That is my argument. By Menger's own reasoning: value is DETERMINED objectively."

These are just claims - BOLD claims! Claims you have to prove, argue rigorously, explain - explain clearly, show evidence for, flesh out, derive, etc... In this vein I could say, "invisible monkeys determine value." When people say, "uh... no they don't." I could respond, "but the implication would mean that everyone was wrong! Don't you see how important that is!" All of the second chunks of your argument would fall the same way from any argument regardless of its merit.

I know what this is like - ask anyone I went to graduate school with or had as a professor. My writing was unclear. On the one hand my ideas made sense to me, but on the other hand, no one seemed to get it. I recommend the following mantra that Pete drilled home, "if the reader says it is unclear, it is unclear by definition."

Pete, is right you're giving up, but what is worse is that your blaming your own laziness on others. To top it all off you feel perfectly comfortable to criticize the work of others having never done anything yourself. You may be right, applications and continuously communicating basic insights of Austrian economics may fail to progress the field - it may fail. But the alternative is certainly worse - never writing a paper that anyone can understand, never engaging an audience, never participating in legitimate debates are all guaranteed to fail.

Lastly, I have the utmost respect for Wash U. and many of the students it has produced. But your chosen path for intellectual development seems down right stupid. Your current strategy which you seem unwilling to change and eager to continue, yields no results (let alone rewards) and obviously carries significant costs. You could be the smartest guy in the world but I'd bet good money that my beer guzzling and bong toking friends from undergrad - if you persist on the same path - are going to wind up much happier and better off than you. That's sad! You like to read and think - admittedly more than most - don't waste that.

"Subjectivism only determines which goods will be selected as objects of valuation. It is the objective quantity of goods in existence that determines its value" - mgm

It is not the objective quantity of goods in existence that *alters* our valuations, but our subjective beliefs about the accessibility--not quantity--of goods in existence. Otherwise, I think I understand your point, but I don't understand its relevance to Austrian economics, because I had just assumed that Mises, Hayek, etc. understood this as much as anyone else should. In any case, it hardly captures everything there is important to say about value.

If the objective quantity of goods did determine value, then Mises's home builder would never overestimate, i.e. undervalue, his supply of bricks!

Hello Daniel,

My basic point is that any person's diminishing marginal utility schedule (is that the correct terminology??) depends on the quantities of goods in existence. Take any good; it is true that the value of that good to anyone diminishes as its quantity increases, as he directs that good to less important (as he perceives it) uses. But whether he uses that good to satisfy his most urgent need, or a need 8th or 9th down the list has nothing to do with subjectivism (his personal tastes) and everything to do with objectivism (the actual quantity of that good). This is why value is objective. That is my basic point.

Oh, and for anyone interested in reading books that have influenced me, and will probably never be discussed on this board, I would encourage you to read through my little book reviews here:

I think these are great reviews, and I remember giving Pete Boettke the link once only to be told that I was wasting my time. In his view, a book review has no importance unless it is a journal published book review!!! In any event, I love re-reading these book reviews, because I forget stuff all the time, and I think these do a good job summarizing the contents of the books reviewed. Enjoy!

"But whether he uses that good to satisfy his most urgent need, or a need 8th or 9th down the list has nothing to do with subjectivism (his personal tastes) and everything to do with objectivism (the actual quantity of that good). This is why value is objective."

I see. So therefore if there were the same "actual quantity" of the good and my tastes changed such that I found that good much less desirable, the good's value would stay the same because it depends upon the "actual quantity of the good."

Good to know Matt. Good to know that substitutes have nothing to do with value. Good to know that faced with the same "actual quantity" of typewriters out there that the invention of the word processor didn't affect their value. Glad to see economics is so helpful in understanding the real world.

Gibberish indeed. You need a refresher principles course Matt. You clearly do not understand what economists mean by value. (Not how they explain it, but what it means.)


You seem to be missing the point. The substitution effect does influence which goods become selected as objects of valuation, but, once selected, their value depends on the number of those goods in existence. Let's take your example, the word processor. With having just one, I would value it very much because I need it to try to get my point across! But any more, and the value of each would fall. Now with more than one the value would be low because, well, there are lots of them in existence. But with just one word processor, the value would be very high. The value of a word processor depends on how many we have, i.e. it is objective.

Now the selection of goods depends on subjective considerations. But its value depends on objective ones.

Is this clear yet?

Pete --

Einstein transformed physics from the Swiss Patent Office.

Wittgenstein transformed philosophy from a trench during WWI.

Science isn't about "winning at Wimbledon".


you are really not talking about values, but prices -- so you are not really proving that value is objective, but simply restating the law of supply and demand by your examples.

If you read Marx you will clearly see the distinction between price and value, see especially what he called the transformation problem. What Menger and others did is not to say that what classicists called value is subjective rather than objective, but that what classicists called value in fact does not exist. So subjective valuations did not replace 'value' in the classicist sense. Rather, 'value' disappears, and price comes in its place. Only then do subjective valuations come into equation to explain one side of the formation of prices.

So your treatment of subjective v. objective value is misplaced because these are not comparable concepts, except in name. Rather think of objective value versus price, and then of subjective values as one element of prices.

Once we know we are really talking about prices, then since they are function of both demand and supply, it's true that the supply part makes them objective in your use of the term.

Well put Slavisa.

I am the most notable critic of Austrian economics, at least according to (See link for my name below.) This accomplishment resulted solely from my Internet-based persona.

Yes, I've tried to get my critique published.

While he was at the patent office wasn't Einstein also submitting papers to a highly regarded journal and completing his dissertation at the University of Zurich, where he later became a professor?

Pete -- if by historical accident "Austrians" controlled the econ. at Harvard, Princeton, Berkeley, MIT, Chicago, and the Swedish Nobel committee, etc. you'd be a "Wimbleton" regular -- this tell us a lot about the nature of "science" in the economics field.

Kuhn's famous book on the nature of science was inspired by the insight that the rules of science don't apply in fields like economics and the "social sciences".

"Founder effects" rule in economics in a way that would be an embarrassment to any respectable science, and you seem to have a "Stockholm syndrome" reaction to this fact.


Ever think you are just a little too pessimistic?

I don't think Dr. Boettke is advocating that people become attached to the label "Austrian", or defensive of economists like Hayek or Mises just because they're Austrians. Time and again Dr. Boettke has stressed that he advocates truth-seeking; he wants people to understand and promote economic understanding. After all, why should only bad economics get motivated advocates and appealing rhetoric?

Many self-described Austrians seem bitter at their marginalisation. Other schools of thought already have enough advantages (such as being more politically useful), so Austrian economics needs every extra push it can get, and I think Dr. Boettke hopes to inspire people to take the fight to the mainstream.

Matt - Austrians have never denied that reality is relevant. The argument is only that whatever changes in the "outside" world must get filtered through the human mind before we talk about value. Adding one more unit of a good only changes the way people value it *because people already, subjectively, think the good is valuable.*

Saying that another unit lowers the good's marginal utility is not saying value is objective. Value and MU are not identical.

Subjective perceptions create value. The interaction of said perceptions and the *perceived* quantity of the good determine marginal utility.

The interaction of numerous people's marginal utilities, including that of the money they would hold/give up to acquire said goods, determines price. Go read the first 66 pages of Man, Economy, and State.

There is no value without human minds.

For thousands of years, oil was a nuisance. Then it became valuable. That isn't because the quantity of oil in existence changed, it's because our subjective perceptions about its usefulness did.

Intro class is now over.

An excellent response Slavisa. Who are you?!?! I haven't read Marx, but you're right: The Austrians have insisted on eliminating "value," or at least conflating it with their conception of price.

But my reading of Menger is more subtle I think. In "Principles," Menger repeatedly refers to the objective AND subjective factors of price formation. This is found, for example, in the chapter entitled "The Theory of Value." In section 2, he divides it into various parts, calling one treatment the "subjective factor," and the other "objective factor" in price formation. In my interpretation, I think more emphasis should be given to what Menger calls the "objective factors," because that is more important, and I believe that Austrians have never even considered this in their understanding of price formation. For them, prices are determined by subjective considerations (just look at Steve Horwitz's two responses).

Now to get back to Steve Horwitz's response. You should go back and read my argument. D'amico quoted it all. Let me repeat it:

Subjectivism determines which goods will be selected as objects of valuation!!! Subjectivism is necessary for price formation, but it does not DETERMINE it. So in your oil example, you are right: people must first value oil before it can properly become "a good." But its value depends on the quantity of oil available --- an objective phenomenon.

And I am all for the "filter of the human mind" as Lachmann called it, and I think Menger was correct in drawing attention to human error. But the basic point is that the marginal utility schedule is arranged according to objective considerations, even though subjectivism is what brings it into existence.

You are right: "There is no value without human minds." But I have already said that. Read this: "subjectivism creates the conditions required for value's emergence." MY argument is that the determination of value depends on the supply, and not the demand. And we can read this in Menger.

Peter, you right:

"Limiting our writing to blogs, or self-published monographs as professional economists would be similar to a professional tennis player limiting his tournament playing to the local club championship, rather than striving to compete at the French Open, Wimbledon, US Open, or Austrailan Open. Rather silly right?"

This is an absurd analogy.

If I am attacking a theory of Gunnar Myrdal,or for that matter Peter Boettke, even in a comment to a post, I am either write or wrong.

I am not playing against a local baroom philosopher who may have never heard of, say, marginal utility. I can play against anyone I want, even when they are college professors making comments that are absurd.


You are confused about what value is.

Also, you treat supply as an objective phenomenon, but it is not. How much of a good is available in the market at any time is the result of the subjective assessments of suppliers, who are deciding whether to produce Good X or Good Y. Thus the fact that there are more apples today than yesterday, meaning that the MU of apples is lower, is itself a result of the subjective perceptions of apple producers and sellers.

Goods don't fall like manna from heaven. They are produced by humans using human minds to subjectively interpret the world and to form valuations as a result.

In other words, both demand and supply ultimately derive from subjective interpretations. Thus, even on your own terms, value/MU (whatever you're calling it), results from subjectivism.

Read the Heyne, Boettke, and Prychitko book.

In terms of fundamentals I think that one can say that
not only the ends are subjective but the means available to satisfy these ends are too subjective, in the sense that like the ends, they only make sense when referring to the subjective perceptions of the individual. In other words, means and ends only exist from the point of view of the planning mind.

I think that you have very deep understanding of some aspects of economics, but in other aspects, like this one you posted here, you appear to be in the level of a first year undergrad student. This kind of asymmetry is corrected by formal studies because you have to study a little of everything. You are forced to have some minimal level of understanding to pass, so you have to understand even what you don't like. And only because you don't like something doesn't mean that they are not important.

Einstein is an interesting example in several ways. First of all he was prepared to work across the range of issue that arise in a serious attack on a big scientific problem - from the heights of speculative conjectures, through the philosophical and methodological issues in play to the mathematics and the details of evidence or experiments that might be required to test his ideas.

Second, his philosophy evolved from the positivism that he later regarded as a mistake. He declined an invitation to contribute to the Carnap "library of living philosophers" series on the ground that positivism, which once appeared to be a "sprightly nag" had become a dead horse.

Third, he was relatively weak in some areas of mathematics and he was lucky to have a friend who helped out at a crucial time. This is a bit like the double helix story. Watson had the good fortune to come across someone who knew that the textbook models of the four basic building blocks were incorrect, so he recut the cardboard models of the double helix and the two chains fitted better.

Fourth, the patent office was a good place for a student with a theoretical interest in time because it was receiving a flood of applications for clocks and time-keeping devices for practical applications like the railways. Einstein got to process many of the applications. In addition to taking them apart to find out how the devices worked, he had to say whether they incorported genuine novelties.

Maybe Wittgenstein is not such a good example, the two revolutions that he introduced in philosophy turned out to be dead ends, at least in the way that positivism and language games were pursued by the great mass of practitioners.

BTW I have taken Pete's basic point on board to the point of looking around for a suitable place to start Ec 101. Is there a correspondence course at GMU? Any other suggestions? A university in Sydney is preferred.

I would like to point out that a lot of modern austrians, being passed the torch from Rothbard, spend a lot of time splitting their writing between economics and philosophy.

This definitely cuts into the impact one could have if he just wrote about economics in general, correct? Whether you perceive that as a just or worthy cause makes all the difference.

I enjoy the economic/philosophic works of Rothbard, Murphy, Block, Hoppe, and many others, and look forward to it continuing.

There is an objective amount of oil in the world. Its value changes relative to use it is put. As a good with negative value during some parts of history, high value when it powers machines, and of moderate value when and if alternative sources of energy are discovered. The supply is only one part of the analysis. The technological process is coincident with the supply of goods and the choices (path-dependent in some cases) of the network that is in place. Horse collars and horse feed still harness horse power, but this is relatively less valuable in the presence of alternatives.

Tastes change, meaning that subjective preferences are important. Value is the interplay between scarcity and human action. Diana Weinert Thomas has a great paper coming out in public choice on how tastes for beer changed in the early modern era and resulted in some interesting results for political economy. There were certainly some objective aspects of that change, but don't loose the subjective component there as well when you read it.

It is incredible that Prof. Boettke continues to repeat this argument ad nauseum. The same old tired analogy of sports to economics. The reality is that sports is nothing like economics. There is no "right" and "wrong" in sports. Sports is simply might makes right. Except for he tragic Seles incident, the best player is the player that wins.

Economics is nothing like that. Despite all of his "career achievements", Keynes economics was fundamentally flaws. So too were his ethics.

It defies my comprehension that someone as intelligent as Prof. Boettke can continue to make a fundamentally flawed analogy, comparing a sport which has no normative value -- outside of playing within the rules -- nor any truth value; with the profession of economics, where there is normative and truth-value.

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