Purpose – To recognize the comments made by Horwitz (2010) and Koppl (2010) in their attempts to reply to D'Amico and Boettke (forthcoming), “Making Sense out of The…
Purpose – To recognize the comments made by Horwitz (2010) and Koppl (2010) in their attempts to reply to D'Amico and Boettke (forthcoming), “Making Sense out of The Sensory Order.” Furthermore, this paper hopes to explain what role D'Amico and Boettke do see for cognitive neuroscience in the study of Austrian economics.
Methodology/approach – Some brief summary comments are presented about Horwitz (2010) and Koppl (2010). Then a general framework of individual learning and its effects upon social institutions and economic processes is described by referring to Cowan and Rizzo (1996) and Denzau and North (1994).
Findings – Hayek was a political economist first and foremost. Whatever the status of his research in theoretical psychology attains, it does not change the fact that we as economists would do well (especially young economists) to focus on his substantive contributions to economics and political economy.
Research limitations/implications – Though space and time constraints did not afford this at present, further research would benefit from an intensive survey of the empirical findings available in the neuroscience and neuroeconomics literatures. How do such findings map onto the proposed frameworks of Hayekian economics provided by Koppl compared to D'Amico and Boettke.
Originality/value of paper – This paper takes notice of the historical linkage between Cowan and Rizzo's (1996) cognitive model of individual learning within the broader tradition of subjectivist/Hayekian/Austrian economics.
The Austrian School of Economics, pioneered in the late nineteenth century by Menger and developed in the twentieth century by Mises and Hayek, is poised to make significant contributions to the methodology, analytics, and social philosophy of economics and political economy in the twenty-first century. But it can only do so if its practitioners accept responsibility to pursue the approach to its logical conclusions with confidence and absence of fear, and with an attitude of open inquiry, acceptance of their own fallibility, and a desire to track truth and offer social understanding. The reason the Austrian school is so well positioned to do this is because (1) it embraces its role as a human science, (2) it does not shy away from public engagement, (3) it takes a humble stance, (4) it seeks to be practical, and (5) there remains so much evolutionary potential to the ideas at the methodological, analytical, and social philosophical level that would challenge the conventional wisdom in economics, political science, sociology, history, law, business, and philosophy. The author explores these five tenants of Austrian economics as a response to the comments on his lead chapter “What Is Still Wrong with the Austrian School of Economics?”
This chapter argues that if Austrian economics is to attain the influence, impact, and esteem enjoyed by comparable traditions, it cannot continue to produce research that only and always reaches free market conclusions. While the foundational principles of Austrian economics are incompatible with socialism, this does not settle every policy question in favor of laissez-faire. Factors such as historical circumstances and the particularities of local contexts should lead Austrians to take seriously some arguments in favor of government intervention. Freed from its ideological shackles, Austrian economics can provide a powerful toolkit for positive, scientific research addressing the most important questions in contemporary political economy.