Max Molden

Government deregulation is usually taken to be a move toward laissez-faire and a lessening of the regulatory burden. But this need not be the case, as I demonstrate in the latest issue of the Independent Review: independent.org/publications/t… 1/3

Going to write a tweet that might be mercilessly dunked on later: I think concerns about job loss+AI are wildly overblown & the economy will be great for workers + consumers generally, including new workers, *especially* in a world where AI capabilities keep improving.

Olson argued it takes a catastrophic shock to clear out entrenched distributional coalitions. AI might be that shock—but expect incumbents to try to regulate it out of existence before it can scale... My latest @EconLib econlib.org/econlog/ai-vs-…

@alexwadecraig Good question. To approach, I'd start with the basics: problems do not exist as such. Problems are always problems to someone (analogous to things vs. goods). From this it follows that, if there is an econ. calc. problem, it is a problem *to* someone—presum. the planner.

So, what *is* the economic calculation problem? A lot of contemporary Austrian treatments of it get a little hand-wavy and say "you can't get all the information together in one place." I think that's true! But also, where does the dysfunction actually, concretely begin?

@alexolegimas How can there be policies if preferences are "fully satiated"?

I’ve now seen this paper posted by several “BREAKING” accounts (and we hopefully know what that means by now). But: 1) there is no mathematical “proof” and 2) the assumptions you need for this prediction don’t hold in practice. I wrote out the economic conditions you need for such demand collapse here: open.substack.com/pub/aleximas/p… There is a formal model linked in the post. TLDR: you need preferences to fully satiate (ie a person doesn’t want literally anything else) for demand collapse to happen, and even if that’s the case, there are many very simple policies can prevent it.

@zingales Isn't this recommendation nothing but a further move on the interventionist spiral, i.e., the manifestation of progressive interventionist dynamics? Isn't, then, the lifting of the complete government intervention more recommendable—even if, practically, perhaps more difficult?

When a company offers securities to investors, it is required to disclose the future prospects of that investment and is held accountable for those promises. When universities solicit students to invest in their degrees, they are not required to disclose the financial return of those degrees, nor are they held accountable for their promises. Universities aggressively market degrees, allowing students to borrow even when studying in fields with possibly no return on investment. On the latest Capitalins’t podcast, I argue this is a catastrophic failure of incentives. Lenders have absolutely nothing at stake because borrowers cannot go bankrupt on college loans. To fix this, we must force universities to have skin in the game. If universities were at least partially financially liable for bad outcomes, they would stop pushing students into disastrous debt. Listen to the full podcast with @noamscheiber here: youtube.com/watch?v=KpZJmB…

Die Politikoption, die in Reaktion auf höhere #Kraftstoffpreise am wenigsten diskutiert wird: Füße stillhalten. Die notwendige Nachfragereduktion gelingt am besten über den #Preismechanismus. Alle „Entlastungen“ schicken ebenso eine Rechnung – nur anders oder später. Je weitgehender der Eingriff, desto fragwürdiger die Wirkung. @welt welt.de/wirtschaft/vid…

Strait of Hormuz: A CitriniResearch Field Trip The Field Report from Analyst #3 is live. citriniresearch.com/p/strait-of-ho…

New essay: AI, Price Theory, and the Future of Economics Research My argument: AI is not just a new tool for economists. It is a shock to the relative prices inside the knowledge economy of research. 1/

@BrianCAlbrecht I'm somewhat startled: is rejecting praxeology compatible with Austrian economics—or rather any social science at all? Praxeology and subjectivism seem to form the foundation for all that you are (rightly) praising. So, curious and looking forward to reading this.

Excited about this new, highly personal paper

@LeviHallo @zumWildschuetz Geld ist ein allgemein gebräuchliches Tauschmittel. Wenn es Deflation gibt, das Preisniveau also sinkt, dann wirst Du mit Geldhalten reicher bzw. kannst Dir davon mehr kaufen. Das trifft aber auf alle zu. Bei Inflation wirst Du ärmer.

@zumWildschuetz nein, ich finde es einfach nur nicht richtig, dass Menschen reicher werden können alleine aus dem Grund, dass sie ohnehin schon viel Geld haben

Ich finde es nicht richtig, dass Menschen reicher werden können alleine aus dem Grund, dass sie ohnehin schon viel Geld haben

Paul Ehrlich no longer a hypocrite

@D_Langenmayr Nach welchen Standards beurteilen sie, ob eine Steuer "gerechtfertigt" ist? Warum ist ihr Urteil relevant, wenn es doch darum geht, dass jemand über andere herrscht (was die Legitimitätsfrage aufwirft)?

Die Steuerfreiheit für Krypto-Gewinne nach 1 Jahr ist eine völlig ungerechtfertigte Bevorzugung relativ zu anderen Vermögensgegenständen. Auch international völlig unüblich. Wäre sehr sinnvoll, wenn das wegfällt.

"The policies of government interference with business and of national planning beget economic nationalism." Mises, Omnipotent Government.

@RMG_Neon @PerBylund Wieser's "The Austr. Sch. and the Theory of Value" remains authoritative: "We value comm. for the sake of their utility, yet we do not value utility when it is coupled with abundance." Now, utility and value are terms, but the concepts they usually refer to are both subjective.

@PerBylund I have read Bohm Bawerk. The examples you gave are still just chemical processes.

That value is subjective doesn't mean it is arbitrary or that it has no relationship to (objective) utility. It only means that the valuation, the particular ranking or urgency felt, is personal: we value things differently, contextually, and based on our own understanding.

@JustinWitzeck @DerDanyal Würde immer noch nicht folgen, da ein Kartellamt den Wettbewerb ja komplett verhindern könnte. Aber: Monopole schließen Wettbewerb mitnichten aus: Wettbewerb ist ein bestimmtes Verhalten von Akteuren. Auch der Monopolist kann sich wettbewerblich verhalten.

@maxcl_m @DerDanyal Weil Monopole jeglichen Wettbewerb ausschließen?

Marktwirtschaftler erkennt man daran, ob sie in einer Lage wie aktuell einen #Tankrabatt einfordern - oder nach dem #Bundeskartellamt rufen.

@LinaJan02491152 @S_Surprenant Spot on. Assuming the goods change seems to me to be disingenuous: it means fundamentally changing the example. However, that preferences are stable is necessary: otherwise, there's nothing wrong with a money pump. But then stable preferences aren't covered by rationality.

@S_Surprenant @maxcl_m No what they mean is what if the preference change?

Rationality in economics 🧵 "Rationality" in economics doesn't mean what you think it means. In particular, it does not mean that someone is reasonable, that they are well informed, or even that they consciously thought through the consequences of their actions. We use the concept of rationality in two distinct, but specific ways. The first use refers to preference relations: rational preferences are complete, transitive and reflexive. This basically means that, given a list of options, you can order them with some possible ties. It rules out "cycles" such as prefering apples to pears, pears to bananas and bananas to apples. To go from there to modelling choices, you need to add constraints (budget, time, location, information, etc.). Constraints remove options from the feasible set and whatever agents prefer in the feasible set is what they do. To a certain extent, saying that agents "always do their best" doesn't say much until you define what best means (i.e., specify preferences) and what is feasible (i.e., add constraints). All of economic theory is finding useful specific ways to apply this idea. The second use of rationality refers to rational expectations and it means model-consistent expectations. What this rules out are systematic forecasting errors, given the information set available to agents when forming these forecasts. This idea was introduced by John Muth (1966) as an approximation. His argument was that forecasting errors are costly, so whether by learning, attrition (e.g., people exiting a market), or both, people should tend to make them "small." Formally, this should be considered the fixed point of an unspecified learning process (e.g., Lucas, 1986). Said differently, we're expecting that markets will approximately yield this kind of behavior at the level of a whole market or a whole economy, though not necessarily at the level of every individual. Now, this isn't a fundamental part of economic theory, it was never intended to be taken literally and it is therefore desirable to explore the consequences of relaxing this assumption. I hope this helps.

@BrianCAlbrecht You'd definitely enjoy Morgenstern's "Vollkommene Voraussicht und wirtschaftliches Gleichgewicht"—published in 1935.

Morning discovery. McCloskey credits Mises with rational expectations

@MateusMBruno What critique are you referring to?

Yesterday I read such a poignant and devastating critique to Rawls' analysis of 18th and 19th C. moral theories that I honestly feel embarrassed rn just by looking at the cover of his book. I didn't find it that boring during my MA though, there's plenty there to engage with!