Thursday, May 5, 2011

Hayek Vs. Keynes




So here we have a remarkably intelligent presentation of the economic debate between Friedrich Hayek and John Maynard Keynes as a rap song and a boxing match. Hayek is assisted by Ludwig van Mises, Keynes by Thomas Malthus. I must admit I am not sure how Malthus fits with Keynes. I would think of Malthus more as being with Hayek in terms of being against government spending on welfare programs. I guess the connection to Keynes is that they both saw man in animalistic terms, motivated by the passions, instead of Hayek's rational producer and consumer.

2 comments:

The Thinker said...

I thought that this video was very interesting. What they argue about is how to treat the economy. What I found interesting is when Hayek argues that the economy is more complex than the simple circular flow diagram. What I learned in macroeconomics was that models are not supposed to be exact, but are supposed to give everybody a general view. One thing that I have noticed is that Hayek has very bad luck and is mostly unheard of and Keynes gets all the credit according to the video. It is inaccurate to say that Hayek is still ignored, although the textbook that I am using is very focused on the Keynsian model.

no one said...

i have a few comments about computer modeling.and economics. Ine is that macro economics was debunked long ago.
the other is that computer modeling in general has the known problem of just being a form of presenting ones already formatted beliefs instead of any way of understanding how to predict thing. They are failures in terms of prediction. the other is they take a curve an model it by linear line in smaller and smaller intervals. the problem is they can miss places where the real curve goes to infinity and the model simply misses it completely.
However they are good in terms of making a parsanah. there are lots of business men that believe computer models so you can get hired making them.