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Playing at markets: A New Austrian perspective on macroeconomic policy

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  • Alexander William Salter

    (Texas Tech University)

Abstract

The New Austrian (also called Neo-Mengerian) paradigm emphasizes the importance of nonequilibrium and emergent processes in explaining the social world. In this paper I analyze macroeconomic policy from a New Austrian perspective. I define macroeconomic policy broadly, encompassing not only policy relating to business cycles and growth, but to any policy aimed at directly manipulating emergent variables. Such policy is fundamentally incoherent, since it attempts to divorce social outcomes from the processes that generate them and give them meaning. A New Austrian approach to macroeconomic policy, which focuses on the rules structuring nonequilibrium-emergent social processes, avoids this problem.

Suggested Citation

  • Alexander William Salter, 2017. "Playing at markets: A New Austrian perspective on macroeconomic policy," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 30(1), pages 39-49, March.
    • Handle: RePEc:kap:revaec:v:30:y:2017:i:1:d:10.1007_s11138-016-0350-3
    DOI: 10.1007/s11138-016-0350-3
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    References listed on IDEAS

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    1. Selgin, George, 1994. "Free Banking and Monetary Control," Economic Journal, Royal Economic Society, vol. 104(427), pages 1449-1459, November.
    2. Armen A. Alchian, 1950. "Uncertainty, Evolution, and Economic Theory," Journal of Political Economy, University of Chicago Press, vol. 58(3), pages 211-211.
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    4. Roger Koppl, 2002. "Big Players and the Economic Theory of Expectations," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-62924-0, December.
    5. Alexander William Salter, 2013. "Not all NGDP Is Created Equal: A Critique of Market Monetarism," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 29(Fall 2013), pages 41-52.
    6. Vernon L. Smith, 2003. "Constructivist and Ecological Rationality in Economics," American Economic Review, American Economic Association, vol. 93(3), pages 465-508, June.
    7. George A. Selgin & Lawrence H. White, 1994. "How Would the Invisible Hand Handle Money?," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1718-1749, December.
    8. Alexander Salter, 2014. "Is there a self-enforcing monetary constitution?," Constitutional Political Economy, Springer, vol. 25(3), pages 280-300, September.
    9. Richard E. Wagner, 2007. "Fiscal Sociology and the Theory of Public Finance," Books, Edward Elgar Publishing, number 12713.
    10. Lucas, Robert Jr, 1976. "Econometric policy evaluation: A critique," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 1(1), pages 19-46, January.
    11. Wagner, Richard E., 2012. "A macro economy as an ecology of plans," Journal of Economic Behavior & Organization, Elsevier, vol. 82(2), pages 433-444.
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    Cited by:

    1. William J. Luther & J. P. McElyea, 2018. "Austrian Macroeconomics in Search of Its Uniqueness," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 33(Summer 20), pages 1-20.

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    More about this item

    Keywords

    Catallaxy; Emergence; Institutions; Menger; New Austrian; Praxeology;
    All these keywords.

    JEL classification:

    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology
    • B53 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Austrian
    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General

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