An Open Letter to Arnold Kling (About What He Says About Tyler Cowen's Talk on "What is Masonomics?")

| Peter Boettke |

Yesterday Tyler Cowen gave a talk at GMU on "What is Masonomics?"  Today Arnold Kling provides a summary of Tyler's talk.  I am posting a response which both disagrees and also finds promise in the research program that Tyler lays out.  However, my strongest disagreement is with the point about the relevance of the Austrian School of Economics for this research program. Some of these points are semantic, but some are substantive. Bottom line: there is only good economics and bad economics, but the Austrian school has traditionally been that school of thought more than others (though not exclusively) that has emphasized the elements of economics explanation that produce good economics.  To forget that simple point, means that you run the risk of trying to tell the story of the development of modern economic research as if you were doing Hamlet but without the Prince.

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Addendum: I apologize to Tyler Cowen for any misrepresentations of his views in my post.  As I said, I was not there at his talk and was going off one posted summary and several email summaries sent to me in a 24 hour period after his talk asking me for my reaction.  But Tyler informs me that these reports are misinterpretations of his talk and his intent. His lecture was about a vision of Masonomics, not the vision of Masonomics.   I am leaving my post up as it was intended to respond to Arnold Kling's representation of the lecture.  But I do want to publicly apologize to Tyler for posting something reporting on views expressed when I wasn't there to listen to them first hand --- that was in bad form, one shouldn't do such things.

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Dear Arnold:

First, I should point out what really doesn't need to be pointed out --- I respect greatly Tyler's intellectual energy; his insights; and his deep and wide knowledge of politics, philosophy, history, cultural studies (though he is more focused on cultural products) and of course economics.   I consider myself lucky to be working in a department with him, and to work closely with him in our roles both at Mercatus and in the department.  Second, I personally believe intellectual diversity is healthy and not to be feared. Disagreement is not something to be overcome through self-censorship, but to be engaged with reasoned discussion and dialogue.  Third, I recommend that everyone should be reading Tyler Cowen all the time --- I have two of his book assigned in my PhD course this term.  I think his "best" book is In Praise of Commercial Culture, but I also think everything he has written deserves not only a reading, but careful study --- including his most recent Create Your Own Economy.  I also think he misses certain things --- from technical issues in Risk and Business Cycles to subtle philosophical points about human meaning in Create Your Own Economy.  I have over the years shared those criticisms with Tyler, he hasn't been moved by them.  The highest praise I can give Tyler is that whenever he writes anything I read it, I learn from it, but I don't always agree with it.  But he NEVER stops being interesting and a source of learning.  This particular lecture is no different.

But, I do think this depiction of "Masonomics" in this lecture is not all that accurate, nor helpful for getting us further as to what makes our research group distinct and worth exploring.  I disagree with #3-- markets always fail (but a lot depends on your definition of things); I find #2 and #5 misleading unless further explained; and #1, #4 and #6 to be completely unobjectionable.  But as the lecture has been reported (I wasn't there as I was attending an excellent presentation by my colleague Omar Al-Ubaydli on his work with John List that bears directly on the ideas of Vernon Smith and indirectly on the ideas of Hayek and Kirzner related to market process theory), certain points are distorted in order to create an appearance of uniqueness and originality; other points are blurred to create an impression of more mainstream acceptabililty; and other points are trivial but presented in a way that might make listeners and readers think they are not trivial. In short, as reported by Arnold and others who I have heard from, the lecture gave the wrong impression.  Yes, Tyler signaling and self-deception abound, but one must always remember that when we talk about signals we also have to talk about not only noise, but also interpretation of the signal.  Informational signals are sent, but interpretation and judgment is required to turn that information into knowledge.  Finally, with respect to the claims being made, we have to remember that much of the claim to a unique Masonomics as laid out in the lecture were worked out not in scientific journals, but in blogs and in conversations, etc.  We are not talking about unique and significant contributions to the "republic of science" that have met the tests of plausibility and intrinsic value before the declaration of originality can be made. Some of the points have met that test, others have not. Truth in advertising might require that a distinction should be made.  Economics is both a public intellectual arena and a scientific discipline. Economics science is advanced within the discipline, not in Washington, or in newspapers, nor in blogs --- no matter how interesting the conversation may be. See the recent paper on blogometrics, does anyone seriously believe I am the 29th most influential economist! I can buy Gary Becker as #1, and I sure wish I was #29, but it is just not true.

A short history of GMU economics might be in order before Arnold keeps trying to promulgate this "meme"-- I have tried to make this claim before to you (Arnold), but you obviously ain't buying.  Let me try again. Masonomics owes its reputation not to blogs, but to a long tradition of economic scholarship that was inspired by F. A. Hayek combined with institutional collisions.  The Center for the Study of Market Processes moved to GMU in the early 1980s -- Tyler and Dan were in fact among the first students. Then in 1983/84 the Center for the Study of Public Choice moved to GMU (James Buchanan). A PhD program was established, and 2 main research centers were in operation --- CSMP (Austrian or market process oriented) and CSPC (public choice and constitutional economics oriented).  Faculty such as Don Lavoie, Karen Vaughn, Jack High, Viktor Vanberg, and later Don Boudreaux and George Selgin --- where developing the market process perspective --- a Hayekian vision of economics and political economy.  This was not at all a backward looking movement, but a research community pushing ideas forward.  Over at CSPC, you have Bob Tollison and Mark Crain mainly pushing empirical public choice, but you also had Buchanan and Gordon Tullock still pursuing broader implications for political economy and social philosophy.  During this time CSPC also had on faculty people like Geoff Brennan, and Bill Shughart and Charles Rowley.

Many of the economics teachers at GMU were trained at UCLA by Armen Alchian and Harold Demsetz, so the Alchian tradition was alive in the microeconomics core and the Clower and Leijonhufvud tradition of coordination macroeconomics was in the macroeconomics core.  Buchanan won the Nobel in 1986 --- putting GMU on the map as a university and in particular as a research and education center in economics.

Hayek, Buchanan, Alchian --- and their ideas is what formed the foundation of what you now call "Masononomics" --- it would be great if this was acknowledged.

Then in 2000s, Vernon Smith joined with his group. Vernon showed in the lab in the early 1980s that Hayek's ideas on the market were correct.  He was an original thinker in public choice analysis and the economic science association at the time met in concert with the public choice society. So Vernon brought a new set of empirical techniques to the questions of Hayek, Buchanan, and Alchian --- as well as his own innovative ideas. Masonomics expanded --- Hayek, Buchanan, Alchian, Smith (and their ideas).  Vernon won the Nobel Prize in 2002, and READ his Nobel address --- that is what Masonomics is about --- ecological rationality, it is also what Hayek was getting at, what Buchanan's essays in What Should Economists Do got at, and what Alchian's famous 1950 paper hinted at.

Bob Tollison once addressed the Virignia Political Economy lecture audience and said at GMU we have 2 distinct and powerful research programs working together --- Public choice, AND Austrian economics.  The combination of these research programs produce something different than either one in isolation to each other.  Add to that subsequent developments of the Law and Economics Center (Henry Manne) and its Coasean impact, and ICES (Vernon Smith) and its experimental and systems design impact, and you have the educational environment that is George Mason economics.

This is NOT generated by blog posts, but by research and educational endeavors --- which blogs talk about. To think otherwise is to confuse the guys at the Washington Post who write about the Redskins with the Redskin players themselves.

Within GMU, we have economic historians working on institutional analysis (John Nye, who brings the Northian influence), we have leading empirical public choice scholars (Thomas Stratman, who studied with Dennis Mueller and Mancur Olson), we have experimentalists (Dan Houser, who also was a Minn PhD which brings in some mechanism design theory), we have public choice thinkers making new twists (Bryan Caplan), we have people working self-regulation in all walks of life (Pete Leeson), and we have op-ed writers (Walter Williams), we have writers of letters to the editor (Don Boudreaux) and we have economic novelists (Russ Roberts).  I am missing I am sure several major elements in our department. But we have a diverse and vibrant department --- a diversity of research approaches and perspectives on how to teach and do economics.  We also have Austrian economists.  Nobody at GMU working in the Austrian tradition believes it to be a backward endeavor.  One Masonomics representative earlier this year on a blog post claimed that he didn't know what Austrians were claiming --- I sent him a published version of a paper which tries to spell it out in 10 propositions, he never really replied. I guess he is unimpressed.  I cannot worry about that, I can only do my work as best as I can and submit it to my peers for critical evaluation.  But I don't seek to find that critical evaluation in the public arena of blogs, but from scientific peers in the journals and in academic books.

I personally believe the biggest self-delusion academics engage in, is the delusion of their own superior intelligence.  We tend to overestimate how smart we are, and underestimate how smart everyone else is.  And this is true as well of emphasizing our own contributions and innovations in the classroom or in our papers.  So take that into account now with respect to me as well.  But Don Lavoie (and me following in his footsteps) were the ones that pushed for the cultural analysis of economic development that now is being claimed as essential for Masonomics.  I wrote my paper "Why Culture Matters" first in the late 1980s, Don advocated field research in political economy from the mid-1980s, my work on the Soviet system was inspired by that and was why there was an emphasis on the black market and "blat", etc.  There was an official system, and the unofficial system which really explained how things worked, how do you get access to that?  Don, Dave and I got involved with Peter Berger's Institute for the Study of Economic Culture precisely because we wanted to under those worlds up close --- political economy of everyday life I dubbed it. Dave was a Fulbright Fellow in Yugoslavia, I was a Fellow at the Academy of Sciences in Moscow --- and once there we interviewed people, we tried to gain access to that "world-as-given" in those socialist and post-socialist economies.  We understood the point about politics and policy, we understood the point about ideology and self-delusion, we understood the point about real-world.  We also understood the point about reading widely, learning from others, listening to criticisms, etc., etc.

Dave and I (and Don) thought we were doing Austrian economics --- Arnold Austrian economics is a live body of thought, not a dead collection of wisdom.  Talk to Kirzner, talk to Rizzo, talk to Koppl, talk to Horwitz, etc.  Why make unbacked claims that simply reinforce unjustified prejudicies?  Is Russ Roberts an Austrian?  His latest book certainly is, he has a blog called Cafe Hayek.  Is Hayek no longer an Austrian?  Would Russ and Hayek fit your description of "dead" thinkers?

As the editor of The Review of Austrian Economics, the person who teaches the PhD course (1 of them at least) in Austrian economics to our PhD students, and the public representative of the Austrian school at GMU, I guess it should be understandable that I would balk at descriptions such as "don't try to reduce every topic to what some iconic Austrian figure said about ; if you listen to some self-proclaimed Austrians, it too often sounds as though there is nothing new to learn or study".  Look at my syllabus --- look at the books listed as recommended, look at the journal articles, read the description of the course.  Does any of that fit with your description of self-proclaimed Austrians?  A lot of new material there for the students to think about --- including the work of Tyler. If not, how does that fit into your description of Masonomics?

One final thing -- I would like you to look at our graduates when discussion Masonomics.  When you think of the Chicago School, you think not only of Milton Friedman, but also how the Chicago school spread throughout the profession. There is a certain style of reasoning associated with that approach.  I suspect Tyler's list was to give the audience a feel of what a Masonomists would be like.  Does this fit with our graduates?  Guys like Brian Goff and Gary Anderson and Samson Kimenyi --- graduates from the 1980s who have published in top journals such as the JPE, etc.  How about Steve Horwitz, Ed Lopez, J C Bradbury, etc. who graduated in the 1990s. And finally, how about graduates like Chris Coyne, Pete Leeson, Ed Stringham, Ben Powell, Ryan Oprea, Xrte Zhao, etc. all graduates in the 2000s. Do any of them fit the Masonomics description.

A blog movement is one thing, a scientific movement is another. What do we have here?  If it is a scientific movement, then what legs does it have?  Where are its products?  If it claims all of the names I have listed and their publications (which it should), then I think you need to revise your self-description and go back to the ideas of Hayek, Buchanan and Smith for inspiration and look to what unites these three brilliant and distinct thinkers.  It is in that overlap where I believe a unique Masonomics exists.   And in that overlap Austrian economics not only plays a role, it plays an essential role.  Hayek's ideas permeate the work of Buchanan and Smith.  It there is a manifesto for Masonomics, we might try to combine the Nobel addresses of these 3 towering figures in economics --- a critique of the pretense of knowledge (Hayek); an emphasize on the contextual nature of all knowledge and thought (Smith); and an optimism for hope for social change in constitutional redesign of the rules of the game (Buchanan).

Lots of lifetime learning going on there, not settled ideas for all time.  Far from dogmatic, yet principled expositors of what we do know about economic life and public policy.

Let me conclude with a quote from Ludwig von Mises (yes one of the old Austrian iconic figures) who might capture for you the spirit of the Austrian school economists:

"There is no such thing as perfection in human knowledge, nor for that matter in any other human achievement. Omniscience is denied to man. The most elaborate theory that seems to satisfy completely our thirst for knowledge may one day be amended or supplanted by a new theory.  Science does not give us absolute and final certainty. It only gives us assurance within the limits of our mental abilities and the prevailing state of scientific thought.  A scientific system is but one station in an endlessly progressing search for knowledge.  It is necessarily affected by the insufficiency inherent in every human effort.  But to acknowledge these facts does not mean that present-day economics is backward.  It merely means that economics is a living thing --- and to live implies both imperfection and change." (Human Action, p. 7).

Sincerely,

Peter Boettke

Comments

[Steve Horwitz]

Wow. WHAT HE SAID.

I can't tell you how frustrated it makes me as a GMU PhD graduate to hear the sorts of descriptions of "Masonomics" (a term I dislike almost as much as "Austro-libertarian" ;) ) that Tyler has apparently given. Pete is right both on theory and history here. The core of what GMU has long been about is the union, not the intersection, of Hayek (and by implication Mises), Buchanan, and Alchian, and later, V. Smith. And it's always been about engaging the profession in the journals.

I just want to add one more piece of the puzzle, even if it seems self-serving. Take an additional step beyond Pete's point about graduate students. Look at the GMU PhDs since 1985. Who have been the most successful as publishers, teachers, and public intellectuals? I'm willing to submit that the correlation between the intensity of "Austrianness" and those measures of success is pretty high. It's not 1.0 but it's strong.

Pete and I were just talking about this last week. Way back when, Buchanan knew which side his bread was buttered when he told the department that whatever else was true of the Austrians, they were bringing in the best students. (Again, self-serving I know, but that doesn't mean it's not true.) My judgment of the last 10 years of students at Mason is that the correlation noted above still holds fairly strongly.

To dismiss the contributions of Austrian economics to the history and quality of the GMU program is not only just blatantly false, it will end up shooting GMU in the foot if it sends the signal that Austrian grad students won't be treated as equally important parts of the research program. Know where your bread is buttered.

[Roger Koppl]

"We're not Austrians! Not that there's anything wrong with that!"

http://www.youtube.com/watch?v=9ild8w0rHQU

[Current]

Note, two T's in Letter ;)

[Mario Rizzo]

If some of your colleagues want to refer to Masonomics, they can have this term. It will not do them good. Not with a movie on the Freemasons coming out...

[Mario Rizzo]

I should also add that I agree entirely with Pete.

[JP Koning]

Here is Vernon Smith's Nobel address:

http://nobelprize.org/nobel_prizes/economics/laureates/2002/smith-lecture.html

[Rob Bradley]

I am a Tyler fan from afar, and with interest I follow his work and some of the controversy he stirs up from the libertarian/Austrian side.

I pose this question for folks to consider: is his propensity to be a little wrong, a little impatient and reaching, and a little politically correct good or bad from the L/A movement as a whole?

I also ask: what famous economist might Tyler be most like? What about Schumpeter, who Galbraith once said about (going from memory): "[When given a choice between being memorable or right, Schumpeter never hesitated]"

[Greg Ransom]

Why is Tyler taken so seriously? Whyndoes what he says matters?

It's because he has a powerful blog and a powerful newspaper column. It's not because of his "scientific" work.

Pete writes:

"certain points are distorted in order to create an appearance of uniqueness and originality"

Isn't this part of the story of Cowen's inaccurate and uncharitavle explications of Hayek's macroeconomics -- the stuff that opens up room for a good deal of the originality and "anti-Hayek" critical force of his Risk and Business Cycle work?

[Greg Ransom]

Three cheers for Cowen's advocacy of a cross disciplinary conception
of the the field of play of the economist and the modern econ department.

Cowen I think is fantasizing.

I think Cowen is telling you what he wants GMU economics to be, not what it is.

[Rafe Champion]

Galbraith once said about (going from memory): "[When given a choice between being memorable or right, Schumpeter never hesitated]".

Neither did Galbraith. But Schumpeter will be remembered longer due to the Austrian part of his thinking.

[Peter Twieg]

First, I'll say that I'm disappointed that I didn't hear about this lecture beforehand. Was it not open to GMU grad students? If not, that strikes me as... imprudent.

I'm sure there are a lot of social dynamics here which I'm only vaguely aware of, but Arnold's post did not strike me as overly dismissive of Austrian economics; indeed, I don't think it's being disputed that:

a) Masonomics IS a tradition which is distinct from Austrian economics
b) Masonomics draws a lot of inspiration from Austrian economics, along with the works of others
c) Some Austrian economists fit the negative characterization which Arnold employs. I don't see this as being aimed at GMU's Austrians, but perhaps I'm being too charitable here.

I think Steve's comment about academic successful and "Austrianness" is somewhat out of line, as it implies... what exactly? That GMU PhDs who don't focus on Austrian economics are of lower intellectual quality? That we're instructed poorly and not prepared for academia? That students who want to help define a characteristically "Masonomic" research agenda are doomed? Is this because Masonomics is a barren research field, or something else? Does the same criticism apply to ICES students? I'm going to avoid feeling insulted here, and instead ask with genuine curiousity why - if it is true - that GMU apparently fails its non-Austrian PhD students.

Maybe I'm being a bit blunt, and this is ill-advised. But what strikes me as surprising here is seeing the GMU Austrians and those (affiliated with them) actively digging in against the Masonomics crowd. Are things really that dysfunctional in the department? From the plain text of Arnold's post, it doesn't seem like there's any reason for the Austrians to react negatively, but I could simply be blissfully ignorant of the squabbles within the department over these things. I don't identify as an Austrian, but I love GMU and find it an incredibly stimulating place to be, and I think there are tons of synergies between the various strands of thought that all parties stand to gain from - the experimentalists, the Austrians, the Carow people, even the computational social scientists. So I just can't understand the divisiveness of the sentiments on display here, from my perspective it seems like a completely unnecessary academic turf war.

[Beyond Buzungulus]

Tyler Cowen is the Perez Hilton of economics.

[Peter Boettke]

People are being way too unkind to Tyler and his contributions to knowledge in economics and social theory. Tyler is a stimulating thinker, that you may or may not agree with --- but he provokes thought.

He is also very accomplished as an economists and public intellectual.

Peter --- this is not an academic turf war, this is an intellectual dispute, with empirical claims being made on both sides that can be refuted against public information. No, dysfunction, but intellectual engagement with an argument.

GMU is an incredibly stimulating place to be for economics students precisely because we have these sort of "methodological" disputes, as opposed to the sort of methodological straight-jacket that exists throughout much of our profession.

BTW, you are proving my point about signals needing to be interpreted and judgements formed in order for information to become knowledge --- what you read as divisive sentiments, I would read as healthy engagement demanding that empirical claims be examined against the factual record of roughly 25 years.

[Steve Horwitz]

And let me just add that my original comment noted that GMU's tradition is the UNION NOT THE INTERSECTION of the Hayek-Buchanan-Alchian-Smith traditions. All of those are part of the GMU tradition. My complaint with what Tyler is reported to have said is that he DID sound overly dismissive of the Austrian contribution to that tradition, which as Pete notes has been there strongly from the beginning partially because Buchanan and Smith were influenced by it themselves.

My point about grad students was also pretty clear: there's no 1:1 correlation. There are terrific grad students throughout the program. But as Pete notes just above, look at the empirical record of the last 25 years and see which ones have been most successful. There's no destiny or fate here, but there is pretty good evidence that the Austrians outperform what many would expect coming in.

My problem with term "Masonomics" is precisely what Greg said above: it reflects what some faculty *want* Mason to be and gives a distorted picture of what it *is* and who, historically, has been most successful there.

[Greg Ransom]

Let's take on Cowen were he lives right now, this "autism" stuff and the "organizing" of lots of stuff.

One problem with economics is it is REALLY HARD and unbelievably complicated and involves the unification of complex webs of conceptual understanding and the accounting for lots of different empirical understandings.

Mainstream economics is REALLY BAD at this right now.

It's internally incoherent and is in all sorts of dimensions a great explanatory failure -- and simply pathological as a causal explanatory science.

Does Cowen offer any cure for this? NO.

As far as I can tell, a Cowenian economics would be more of an "all over the place" collage, with LESS internal coherence and LESS explanatory unity and LESS causal explanatory power. In other words, it would be more of an autistic mess of little islands of disconnected "organizing" -- sort of like the order you find in different corners of a hoarders house.

Compare Cowenian economics to the economics of Bruce Caldwell of Philip Mirowski -- Caldwell and Mirowski's work brings systematicity and an critical understanding to the whole grand explanatory project of economics at its core across across decades of research. Tying together explanatory strands across research programs and across life times of reflection and achievement in economics sorts out explanatory power and causal achievement from 5th wheel hoarder piling within the dustbin corners of the all the professional journals of the AEA -- or the mostly explanatorially and causally unjustified formal stuff on page after after page across the textbooks.

So when Cowen trashes economics richly embedded in the complex net of most powerful explanatory and causal traditions in economics -- he's doing so to advance the hoarder "ordering" of the autistic with piles of disconnected little systemeticity pilled everywhere you look in his room.

[Greg Ransom]

I'd point to the work of Douglass North as another example of a great anti_Cowen / anti-autistic economists who unifies and expands the explanatory power of economics -- and often does so by placin his work in the larger context of various economics traditions -- e.g. note all of North's footnotes to Hayek in his most recent book.

[Roger Koppl]

Tyler's a pretty subtle guy and not to be dismissed so lightly. While we're at it, we shouldn't dismiss "autistic" economics so lightly either. I was at a workshop in Stanford when Akerlof presented some of his then-incipient ideas on identity. Several of us having a more or less Austrian disposition were giving him a hard time about putting identity in the utility function. No, no, we cried, identity is about *meaning*. I still think that's true in some sense. But then Akerlof and Kranton (QJE 2000) turns out to be quite useful for many purposes, including some of the forensic science issues I've been working on with Jim Cowan and others. So, you know, we can dig Hayek and say how he has so much to offer without pitching everything that doesn't look like Hayek. Let a hundred flowers bloom.

[Greg Ransom]

I'm all for a 1,000 flowers blooming.

But economics has big problems right at its core -- a thousand new flowers are going to fix that problem. And attacks on efforts to unify and make coherent the explanatory project of economics within the deep context it's most powerful causal explanatory traditions does represent any kind of progress.

What are the big issues in this converation between Cowen and Boettke?

It's not Boettke who wants to kill any flowers -- it's Cowen who wants to cut off and kill the trunk and root system.

[Greg Ransom]

I'm all for a 1,000 flowers blooming.
But economics has big problems right at its core -- a thousand new flowers are NOT going to fix that problem.

[Roger Koppl]

Stop and smell the flowers, Greg.

[Roger Koppl]

I didn't think of that until just now -- honest!

[Greg Ransom]

Roger, I'm well known for doing this. Honest.

And I've perhaps done too much -- all the time I've spent reading neuroscience and biology etc perhaps should have been spent doing math.

(When I read or listened to some of Cowen's pupular stuff on brain science and biology and psychology etc I'm usually not that impressed. It's not up to the standard of the philosophers who work the same material -- much less the neuroscientists and biologists. But I am not familiar with Cowen's peer reviewed articles treating this stuff, which I don't doubt is of a higher caliber.)

[Greg Ransom]

Roger, I was smelling the flowers of a lot that Cowen talks about ie self deception, neuroscience, psychology etc 20 years ago and more -- I think it's great that Cowen celebrates this party and invites more economists to join the party. That's a very good thing and I commend him on that.

Are the economists doings a better job handling this stuff than the neuroscientists, psychologists, biologists and philosophers I was studying 20 years ago?

Let's hope in some ways they are. But it seems evident in some ways
the economists haven't grappled with some of the deeper issue at hand here -- and aren't sure how to keep their identity as "economists" while working this territory -- in fact a concern with keeping their "economic science" idenTitus seems
to shape this work as much as anyhing.

[Richard O. Hammer]

I take the name of Tyler Cowen's blog, "Marginal Revolution" to suggest that he chooses to work on the margin. He places himself at the edge of the existing power structure, not deep within it, but not entirely outside of it either. That's where he thinks he can be most successful. That's why he is so maddening to one who prefers clean truths.

[Charles]

I've always supposed (correctly, I think) that GMU's specialty was economic theory informed by Austrian and Public Choice insights. The "Masonomics" that Cowen apparently laid out seems like a mishmash of different ideas, none of them very profound, that lead to a kind of interesting but shallow contrarianism.

Very unfortunate, because clever contrarianism won't lead us to a better understanding of the world, nor will it help us form better policy & applications.

It'll be too bad if Cowen's version is indeed the future of Masonomics.

[Roger Koppl]

I think it's fair to say that the Cowen/Kling take on Masonomics undersells Austrian economics and evolutionary thinking both. I don't think it's fair to say that it's "shallow contrarianism." Come on, the Cowen/Kling stuff is pretty serious and you shouldn't give it the back of your hand, as I said earlier.

I'm sorry that Bryan Caplan gets more attention as a representative of Masonomics than David Levy. Bryan is a serious and smart guy and everything. (And he's a pleasant lunch partner.) But Caplan represents, IMHO, bad epistemics whereas Levy represents a much better epistemics. What Buchanan & Tullock have called "methodological symmetry" is lesson number one: You have to model all the actors symmetrically, which includes both experts inside your model and you the model builder. This notions is pretty much what Peart and Levy call "analytical egalitarianism." Levy's research program is strongly Misesian. Caplan's is anti-Misesian. The main point here is precisely analytical egalitarianism. If Caplan is at the center of "Masonomics" and Levy the edge, then maybe we should embrace the suggestion that "Masonomics" is not Austrian economics.

[Turd Ferguson]

The purpose of Tylers various musings isn't to draw insights from a wide range of disciplines, but to show the world that Tyler is a really, really smart guy. No wonder Pete likes him so much.

[Barkley Rosser]

Well, obviously the problem at Mason is that you all have just too darned many seminars happening at the same time. No matter you all are in a tizzy!

More seriously, I was not aware of the strength of the Alchian connection. Is that really stronger than the Chicago link through Buchanan and others like Levy?

Oh, and Greg, keep in mind that Mirowski's department is in the process of being disbanded.

[Tyler Cowen]

How many of you were at the talk? Very little in the above comments has bearing on it, starting with my very first point, from the talk, repeated three or so times, that I was discussing "a Masonomics," not "the Masonomics."

[Roger Koppl]

Tyler,

I didn't detect that distinction in Arnold Kling's summary. You were the first commenter on his post. You made one or two minor corrections (depending on how you count 'em), but said nothing about "a" vs. "the." That distinction is inconsistent with Kling's words, "Also, what Masonomics is not: evolutionary biology . . . Austrian economics . . . " Altogether, then, I think you can say "Wish this point had been clear" or "Sorry I didn't call Arnold on this point" or something like that. But I don't think it's fair to castigate Pete or others for missing the distinction in this discussion.

[Greg Ransom]

Barkley, is Mirowski returning to the econ dept? What happened at ND is a disgrace. Anything which allows Mirowski grad students is what matters
at this point.

Barkley wrote:

Oh, and Greg, keep in mind that Mirowski's department is in the process of being disbanded.

[Peter Boettke]

Dear Tyler (and everyone else):

If I had understod Tyler's talk to be about _a_ Masonomics, and not _the_ Masonomics, I NEVER would have written an Open Letter. As I said in my first paragraph, I consider intellectual diversity a value not a distraction. Moreoever, as I said, Tyler always has something of value to say and thus I actually would have encouraged everyone to listen.

But Arnold has been trying for awhile to establish a "meme" which summarizes not _a_ Masonomics, but _the_ Masonomics. If you look back over my letter, after I admit I wasn't at your talk, I address mainly Arnold's rendering of the talk (mediated no doubt by other impressions that were conveyed to me within a 24 hour period).

I apologize for Tyler for any misrepresentations, and hope that my comments will be seen as directed primarily at Arnold's description of the talk.

Pete

[Peter Boettke]

That should read "I apologize to Tyler".

[Lord Buzungulus, Bringer of the Purple Light]

C'mon Pete, show some spine, you have no reason to apologize here. Steve: please slap Pete around here to stiffen his resolve.

[TGGP]

Levy wound up with egg on his face when he accused others of misreading Galton due to his own misreading:
http://www.overcomingbias.com/2007/10/author-misreads.html
From what I've read of Levy, he puts a lot of effort into claiming that economists (particularly the classical liberal tradition) are on "the side of the angels". I think Caplan's disinterest in that (he tries to make economists seem correct, not likable) gives him better epistemics. But I'm no Misesian!

[Peter Boettke]

TGGP,

I think you have a very strange notion of scientific engagement IF admitting error is ruled out as being part of a better epistemics.

Also, I think your reading of Levy is extremely wrong --- he does not find the classical liberals on the side of the angels; read his recent papers highly critical of Leonard Read and FEE. If anything, David stretches arguments to critique, not to defend.

Roger's point about analytical egalitarianism is the right one for understanding Levy's project; as would be one that emphasized institutional robustness --- and how to derive the latter from the former.

David is a Chicago economist, David is a rational reconstructivist, David is a Quinean, etc., but he is not a Misesian nor is he wilfuly distorting the record to put economists on the side of the angels.

As both he and Sandy said in the instance that you point to --- ironically in a piece about carefulness, they made a careless error. They subsequently pulled their paper down for rethinking. As Keynes once supposedly said in response to criticisms that he changed his mind ... what would you have me do when confronted with a better argument or new evidence?

[Barkley Rosser]

Greg,

The situation is that a few years ago the grad students were taken away from the heterodox department that Mirowski is in and given to this new "third rate MIT department." Now, the heterodox department is being shut down entirely, with its members to be scattered among other departments and think tanks, but forbidden not only to teach grad students, but now intro or intermediate level undergrad students. They will be allowed to teach their regular upper level courses, wherever they end up being located to those undergrads interested in taking their courses. Under the circumstances, I expect many of them to leave Notre Dame.

This is indeed a serious scandal all the way around. I understand that there is a petition floating around to protest this, but just as with the initial move to set up the new (boringly conventional) department and hand the grad students to it, I fear the fix is in the bag on this one. From what I understand through my connections there, the bad guy in this is an egomaniacal dean.

[Barkley Rosser]

BTW, with regard to the main argument of Pete's post, is accurate to take it that the invocation of Alchian is a reference to the interest in evolutionary theory that some have at Mason, and which you seem to see Tyler as not being in favor of (along with Austrian economics)?

Sounds like you all need to go to lunch together, :-).

BTW, obviously at ND the people in the heterodox department who will be scattered to other departments will only be the tenured ones. However, I don't think there are many untenured ones as the department has pretty much not been allowed to hire since the new department was created.

[Roger Koppl]

Pete,

I think you are right to shrug off Levy's faux pas on Surowiecki. Moreover, he corrected himself promptly *and* in his apology correctly identified the "two failures" the led him astray. In other words, he is a mensch.

Here is why I said he is Misesian. In an appendix to Socialism, Mises says,
"In the genealogical tree of the Nazi doctrine such Latins as Sismondi and Georges Sorel, and such Anglo-Saxons as Carlyle, Ruskin and Houston Stewart Chamberlain, were more conspicuous than any German. "

http://www.econlib.org/library/Mises/msSApp.html#Epilogue

Peart and Levy cite that passage.

Peart and Levy used the term analysitical egalitarianism, not Mises. But I think it's fair to say that Mises adheres to it. For example, the categorical structure of action is essential to Mises, which means polylogicism is anathema to him and his program. That an important aspect of "analytical egalitarianism" without which you don't get methodological individualism. Peart and Levy quote Mises on race, too:

The anti-race argument was made even more emphatically, perhaps, by Ludwig von Mises:

"[The ethnologists] are utterly mistaken in contending that these other races have been guided in their activities by motives other than those which have actuated the white race. The Asiatics and the Africans no less than the peoples of European descent have been eager to struggle successfully for survival and to use reason as the foremost weapon in these endeavors."

—Human Action, London, 1949, p. 85.

Part of the P&L attack on eugenics is that it is genetic central planning and they are explicit about the Austrian connection there.

Altogether, I think it's fair to see Levy as more Misesian than Caplan, who places too much faith in experts to be in the Mises line.

Of course you might say, "So much the worse for Mises." Labels don't spare us the need to work out the issues! But I think it's good to spend some time on labels and this case the label "Misesian" fits Peart & Levy better than Caplan IMHO.

[Peter Boettke]

Barkley,

Not quite what I meant to communicate in my open letter. First, it was about a specific time and place -- GMU 1984-88 -- the GMU I knew as a student. The UCLA influence has been kept through the years with Walter Williams. And the core book for students in price theory to get their heads wrapped around is Alchian's University Economics. That provides the intuition, the formalism (presented in various books since then depending on who is doing the teaching, etc. -- from Silverberg, and Varian's texts, to Kreps, to Mas-Colell) is always framed within a reference point to the UCLA price theory tradition.

You correctly pointed out the Chicago price theory tradition as well as part of what students of Simon and Knight, and then Stigler brought to the table. And now Pete Leeson (a felllow at the Becker Center) is bringing that even more into the mix. So I would see the mix between UCLA and Chicago traditions of price theory, as what is in the core training (or "should be") of our students.

I actually think we need more price theory, not less in our curriculum at GMU -- the only real economics is relative price economics and all of that! Once students get the technical issues down and have the intuition even more down, it is relatively easy to get them to appreciate the subtle points in price theory that Mises-Hayek-Kirzner were (are) making and how to develop an Austrian theory of the market process (topic for my lecture tonight BTW).

Anyway, the point I was making in my letter was about roots, not about contemporary practice. Alchian's ideas (and Demsetz's) were very much a part of the core training of PhD students at GMU in the 1980s --- it was as I said a mix of Hayek, Buchanan and Alchian, that spread across the curriculum -- with applications from Tullock and Tollison largely.

The Austrian group pushed from that core training to appreciate the ideas of Mises-Lachmann-Kirzner (and Rothbard) in a new light that just read in isolation. Again that was the teachings in the 1980s, and a premium was placed on learning the ideas of the Brits -- Shackle and Loasby, as well as the new scholars such as Langlois, White, Selgin, etc. as well as the ideas of Garrison, O'Driscoll, and Rizzo. So the Austrian group took the core training and ran in a different direction than the public choice guys. Our applications came not exclusively from Tollison and Tullock, but from the problems with socialism (where Tollison and Tullock came back in with the rent-seeking analysis) and problems of revisionist history (where Rothbard's work on the progressives was influential --- and the work of new left historians such as Kolko and Weinstein).

Again this was 1980s, not today. And at the backend of that decade, Lavoie started pushing for ethnographic work to supplement archival revisionist history --- thus the study of culture and development in far away lands. He never did his development study, but I was working with him on the project when i was a student as his RA. And the emphasis on the black market --- see Alain Besancon (The Anatomy of a Spectre, 1980 article) to get a good idea on how we were approaching the understanding of the Soviet system and how one had to gain access to the "world-as-given" to make sense of it). Emily Chamlee-Wright took up Don's research program and did field work in Africa. When GPI was established a decade later, we sponsored field trips in Africa, throughout East and Central Europe, Latin America, and Asia. The products from this have been enormous, though not in developing a unique ethnographic economics/political economy. But in doing rather traditional political economy informed by some ethnographic information and experiences to help ground traditional analysis. Not exactly the radical transformation Don was hoping for, but a very productive development in terms of publication in various journals, etc. Black market research led to research on self-governance to research on how small scale capital accumulation breds growth and development (microfinance, etc.), and more importantly, how state-led development projects in the less developed world, as well as in war torn states, misunderstand the source of development and improvements in human well-being. So the methodological revolution Don advocated didn't take place, the a shift of analytical focus did, and some radical implications of the work followed. See the recent survey article in Public Choice on "Anarchism" and look at the recent work in the field, or look at Stringham's edited books --- both Anarchy, State and Public Choice, and Anarchy and the Law.

Pete

[Adam]

On the Alchian point that Barkley and Pete brought up:

I just graduated from Mason, so I can confirm what Pete's saying as still largely the case. Exchange and Production is part of the first micro class. It's not just Alchian's evolutionary stuff but his price theory that gets play.

This is a more natural fit than Chicago price theory, though of course they are very close. I actually (off-handedly) claim in the first chapter of my dissertation (on my website, which you can get to below) that UCLA price theory is noticeably closer to an Austrian approach. For a few reasons:

-The focus is on exchange, not on allocation (as with Buchanan) or bad neoclassical utility theory.

-It is more consistently subjectivist than the standard Chicago approach. That is, cost is opportunity cost to the individual. Check out O'Driscoll's take on monopoly prices in Method, Process, and Austrian Economics--gleaned from an Alchian lecture, if I remember correctly.

-The claims in the price theory book are presented as institutionally contingent. Rational choice might apply to other spheres, but prices shape it in specific ways.

I would *not* argue that Alchian information stuff is equivalent to Hayekian knowledge or Kirznerian discovery, but on the choice theoretic side, as a dogmatic Austrian I'm very comfortable in LA. Less so in Chicago.

[action movies]

great post. pain does relate to the greatest art works of all time.my goodness, you are so right!