Timmy elsewhere

At the ASI.

That Austrian view that recessions are about past malinvestment seems true at least at times.

2 thoughts on “Timmy elsewhere”

  1. Tim, the Austrian School doesn’t do macroecnomics, indeed the whole point of the praxeological approach is an explicit rejection of macroeconomics.

    Austrian School observes that there are large scale effects which you could describe as “macroeconomic”, but explicitly rejects the idea that you can do a macroeconomic analysis of aggregate statistics, or can manipulate the economy macroeconomically. The only macroeconomic prescrption from the Austrian School is “stop interfering, whatever you do will make matters worse!”.

    So for instance an Austrian will say, that if you print some more money there will very likely be inflation, but it is inherently impossible to know how much inflation, or how long it will take, or which particular prices will be affected and by what amount.

  2. An airport is very much a public good in the “lighthouse” sense ( the lighthouse being the canonical narrative used to explain public goods in a simple manner ). This is then very much more akin to a public choice problem than “malinvestment”. Seems tome the better part of valor is to cheerfully print up $900MegaEuro to cover the sunk cost of the bad investment, and assuming you can point the bony finger at whoever approved it, attach that cost to their reputation.

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