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Geez! We start to get a handle on Neo-Classical Economics only to have the Austrian School rear its head!  Points to Das Monde for wading through this stuff.  Arrrrgg!

I am certainly no expert on the Austrian School.  We tend to think of them as being a lot the same as the NCE folks, but my own reading has shown me that there has been a long standing feud between the two schools.  Gaffeny makes the point that for the Austrians it became second nature to assume opposition from those operating out of a Hegelian thesis-antithesis-synthesis paradigm, which underlies Marxist ideology of all sorts and is common in European Socialism.  But Marx did not resonate in the early 20th Century USA.  

Gaffney discusses this in his paper starting on p. 53.  Interestingly, Clark's ideas about capital were closer to Marx than to Henry George.  And in the USA George and his ideas were the threat.  Had he focused on Marx, the Austrian school would have been natural allies.  Instead, Clark picked a fight with the Austrian School and his student, Frank Knight, who went on to found the Chicago School, carried that fight on to "outlandish extremes" according to Gaffney.  

Gaffney suggests that the affinity for Hegel found in Clark, Knight and Ely derives from the fact that they or their mentors  received their Ph.Ds from German Universities in the latter 19th century.  Clark found Bismark's Prussian determination to impose state approved though patterns on the citizens through education to be quite natural!  All part of nation building.  At least Bismark gave the world social security.

Interesting stuff, as are your findings about the Austrian School.  And wading through the National Review!  Clearly more heroic than reading The Economist.



"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Apr 16th, 2009 at 04:52:20 PM EST

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