The Economics of Ignorance and Coordination

|Peter Boettke|

Back in 1985, Dave Prychitko and I attended a small gathering of economists and public policy intellectuals at the CATO Institute awaiting the arrival of Mario Rizzo and Gerald O'Driscoll's The Economics of Time and Ignorance, which was actually held up in customs. When the books finally arrived, Prychitko and I got our copies and were actually #1 and #2 to get the books signed the authors.  This remains among my most cherished books in my library to this day.  I could only dream at the time that I would one day be Mario's colleague at NYU, let alone come to consider him a dear friend.  I remember running home after that book signing and reading the book (especially the first part of the book on time and subjectivism) in a state of intellectual excitement.  Rizzo, the author of the great classic on praxeology and econometrics, as well as the amazing law amid flux, was now teaching me about radical subjectivism, Bergsonian time, and plan coordination.  Gerald O'Driscoll was teaching me about monopoly and market process theory, and lets not forget Roger Garrison's excellent discussion in the book on the economics of a capital-using economy.  Methodological and analytically, I still think The Economics of Time and Ignorance remains fresh and pregnant with ideas for readers.  If it had any shortcoming, it wasn't as some critics suggested with the substantive analytics let alone the methodological restatement, but with the paucity of application.

Anyway, Thierry Aimar has just published his The Economics of Ignorance and Coordination: Subjectivism and the Austrian School of Economics (Edward Elgar, 2009).  Aimar's book -- part of my "New Thinking in Political Economy" series -- is more or less a survey of modern Austrian economics.  And I think a very good one at that.  Aimar goes over a lot of familiar material for those trained in the tradition, but he also relates the literature to the debates within the wider intellectual community of professional economics, and also to the disputes within the contemporary Austrian tradition themselves.  Aimar takes as his epigraph Kirzner's "If Austrian economists are to be able to work constructively in the rough and tumble of the intellectual market place, anything approaching rhetorical brawling must once and for all be rejected."   What a great quote from Kirzner, and Aimar follows that advice throughout the book.  He doesn't shy away from disputes, but he does always treat the opinions of his targets respectfully.  In many ways, I'd say that Aimar has made a signficant contribution to the 'art of economic controversy' at the methodology and method level.  His book is short on application as well.

To get a sense of the book, the penultimate paragraph is a good place to start:

"So the  Austrian school is still alive and kicking; all these examples show not only the importance of the ignorance paradigm but of the need to free it from a certain number of now cliched critiques.  So the school must be allowed to continue to grow as it has always has: as a heterodoxy, resisting and questioning the dominant ideas and certainties of the moment, whatever their source and nature, becoming more and more involved in the great theoretical debates of the day yet staying well away from any damaging partisanship.  While remaining solidly anchored to its fundamentals, the multiple, constantly evolving, glittering facets of this complex system of thought will greatly contribute to preventing it from being petrified into some sort of dull totem."

It is my sincere hope that some aspiring economists read Aimar's book with the same sense of intellectual excitement that Prychitko and I read O'Driscoll and Rizzo in 1985.  If that does occur, Aimar will have accomplished his twin goal of contributing to a better understanding of the Austrian tradition, and encouraging a greater respect for the ideas of the tradition among a new generation of economists and social scientists.

Comments

[Jeff]

I'd buy this and Sanford Ikeda's "Dynamics of the Mixed Economy: Toward a Theory of Interventionism" in a second if it wasn't for the $140 pricetags.

Really?

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[Sebaneau]

Isn't there anything else to quote from this book than borrowed, self-deprecating and contrived apologies for being an Austrian?