Austrian Economics

For decades economists have formulated equations based on John Maynard Keynes' theroetical hypothesizing. There are no mechanisms in macroeconomics to experimentally establish causality as is possible in the natural sciences. No studies can test Keynes' hypothesis, because one cannot experiment on entire economies comprimising millions of people who have individual life plans.

Human beings, unlike atoms in a science experiment, have feelings, thoughts, desires and personal preferences. In economics you cannot formulate a law or formula that represents the real world, as a century of Keynes voodoo science has shown. Economics has no constants, and without constants there can be no measurement and furthermore there can be no quantitative relationships established.

Value is subjective and therefore it cannot be measured. You can only measure value ordinally, meaning in a way that compares the value of one good to another. But again, since value is subjective it's not measurable. Value is something that is experienced psychologically, it is not physically defined.

The goal of economic analysis is understanding. The focus lies on understanding the meaning of action and the logical deduction of the consequences of it. Human action is rational, in the sense of being the product of reason, not in the sense of being correct. When talking about the Austrian way of economics, we talk about logical deduction, thought experiments and common sense familiarity with reality, to understand the implications of economical processes.

However the dominant apporaches of mainstream economics today, rely on mathematical analysis. Replicable experimentation on economic questions is impossible. Economic studies have turned into pseudoscience to give reasons to the government, to expand the money supply and to justify criminal acts like wars. This is the unfortunate truth of our time, and therefore Austrian economics is more relevant than ever.

I don't believe we shall ever have a good money again before we take the thing out of the hands of government. - F.A Hayek