Economics books

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fiby41
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Economics books

Post by fiby41 »

From the ERE reference list

1 Economics in 1 lesson
2 Human Action
3 Man Economy State

In which order should I read them?

I have skimmed all 3 ; they seem to have a lot of topics in common. If I read 2; which one can be skipped for now?
Last edited by fiby41 on Mon May 11, 2015 12:23 pm, edited 1 time in total.

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Re: Economics books

Post by jacob »

1-3-2

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fiby41
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Re: Economics books

Post by fiby41 »

If I read 1 & 2 can I postpone 3?

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Re: Economics books

Post by jacob »

It's not like there's gonna be a test...

Dragline
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Re: Economics books

Post by Dragline »

I would go read about praxeology first and decide whether you believe that it provides an accurate model for how human beings make decisions. It's based largely on the assumptions and views of Aristotle.

As von Mises stated, all Austrian Economics is merely a subset of praxeology. See http://www.praxeology.net/praxeo.htm

All these books are, in essence, is an extension of the assumptions of praxeology into the economic sphere.

The main central critique of praxeology is that it ignores actual data in favor of assuming things and making deductions from there: http://azizonomics.com/2012/08/28/a-cri ... -rothbard/

What you will find most in those books are a few key assumptions that are slid by in the introductory sections, a lot of deductions therefrom, and little or no analysis of real world data.

Some like it that way. But most people I know who espouse these views are ignorant of the basis for their own beliefs. Don't be one of those.

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Re: Economics books

Post by jacob »

Dragline wrote: What you will find most in those books are a few key assumptions that are slid by in the introductory sections, a lot of deductions therefrom, and little or no analysis of real world data.
Conversely, what you'll find from most of those other [neoclassical] books are several blatantly wrong assumptions that are only in there in order to make the math work on the real world data so as to obtain a temporary release from the physics envy of the economics profession.

In short, you can choose between
1) Correct assumptions + Lack of Real World Data = Accurate but imprecise statements about the world
2) Incorrect assumptions + Real World Data = Inaccurate but precise statements about the world

Both are dangerous, but one is more dangerous than the other. However, the reason they are dangerous is that they are incomplete on their own. (1) is deductive. (2) is inductive. These are opposed but also complementary reasoning methods.

Saying one is better than the other is a bit like arguing whether light is a wave or a particle. However, in my not so humble opinion it's certainly more helpful to develop an intuition if you have the correct assumptions when you [your brain] observe the real world (even if you can't mathematically compute "results") than trying to force your observations into the wrong framework just in order to get a "result" and make a quantitative statement. Especially when you're not in the business of writing reports and economics papers.

Incidentally, more modern approaches (using computers) attempt to use both, i.e. correct assumptions and real world data, e.g. agent based modelling. The economics profession has made significant progress from what passes for dogma at the undergraduate level (e.g. rational efficiency, etc.).

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Re: Economics books

Post by JamesR »

Dragline,

I'm guessing you're talking about induction(from a few axioms) versus empiricism, just using different terminology? It's interesting how induction from a few axioms can build these amazingly convincing ivory towers, yet diverge from reality significantly.

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Re: Economics books

Post by Dragline »

Yes, essentially -- it's what made Aristotle such a great thinker -- he practically invented logic, but was no Archimedes and tended to pontificate a bunch of bullshit.

In modern parlance, its called GIGO -- garbage in, garbage out.

For a discussion of the relationships and differences among praxeology, empiricism and positivism from the praxeological point of view, see http://archive.freecapitalists.org/forums/t/31575.aspx as it responds to http://www.cato-unbound.org/2012/09/10/ ... ustrian-it

Historically, praxeology was an early 20th century reaction to 19th century positivism which animated socialism. All three of the cited works were written in that context -- as a reaction. But since then whole lifetimes of work have been devoted to studying how humans actually make decisions based on actual data, resulting in works like Thinking, Fast and Slow (Kahneman) and Predictably Irrational (Ariely), which tend to undercut the main praxeological assumptions at their core and tend to lead to a conclusion that both the positivists and praxeologists were wrong in their conclusions -- economic life, its problems and solutions are more complex than either wanted to admit.

The response from praxeologists is less than satisfying -- basically they say "pay no attention to the man behind the curtain -- the great and powerful Oz has told us to assume rationality at all times, so we don't care why people do what they do, only that they do it and all human actions are rational by definition": https://mises.org/library/what-do-austr ... n-rational

In essence, they are fighting a war against positivism than ended long ago. They won the war, but not for the reasons they espouse, which irks them to no end. So they endless joust against the straw men of yesteryear and equate anything newer than 1960 to one of those dusty old straw men.

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Re: Economics books

Post by fiby41 »

I am learning economics because I'm interested in the subject and so that I don't end up receiving the short end of the stick due to my absense of relevant knowledge and understanding. When I was a kid, it blew my mind away that the money I kept in a box was losing its value even though I hadn't touched it for years prior to.

I've previously tried to understand why people do what they do but have little to show for the time spent. Now what I'm most concerned about is that I'm not ill affected by what other people who are more powerful than me do, for example, by some interest rate a person sitting half the world across arbitrarily comes up with.

For this purpose, I think assuming that people make rational decisions that best serve their interests to the best of the information available to them should suffice.

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Re: Economics books

Post by jamiesmoneyadvice »

You should add Basic Economics by Thomas Sowell to this list. It's the best and easiest economics book I've ever read.

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Re: Economics books

Post by fiby41 »

From jacob's posted link: http://www.jayhanson.org/oldindex.htm
“Economics” is an intellectual Trojan Horse with political agendas hidden within known-false assumptions.
The political conclusions follow logically from the assumptions, so if you accept those known-false assumptions,
then you also accept those hidden political agendas.
This explains my feeling while reading through some of those libertarian texts rather aptly.

Comments? Your experience?

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