.@pt shared some good thoughts in response to my primer on Austrian economics (tokendaily.co/blog/a-primer-…) and I wanted to share them here:
“Big picture, I maybe think of that Austrians differently than you’ve characterized them. I see them as valuing the individual’s ability to maximize their own utility, vs the other schools, which are focused on maximizing aggregate utility."
"(I think they’d argue this is a distinction without a difference because the latter leads to the former, but that’s perhaps an empirical question!")
"I tend to buy the mainstream argument that hard currency discourages desirable economic activity, prevents investment, innovation, and wealth creation, leaving us at a local maxima that favors those with wealth over those who know how to use capital to create new wealth.”"
"I think the frame of values is the right one. Who do we want to favor? Economics looks different from science (though less often than you’d think!) because we bake in values into these theories and call them facts.”
“The reason saving itself is a bug (That favors today’s rich) is that putting your $ under a mattress doesn’t create wealth. It preserves it, which you could value more (as they do), but if you value new wealth creation, inflation is good. It encourages productive investment. “
“So I’d disagree that Austrian encourages capital accumulation. Preservation isn’t accumulation.
The Q is do u want to optimize for “preserving $ you rightfully earned + not letting the state ‘steal it’” or do u want to design policy to “create $ by incentivizing investment.”
The Q is do u want to optimize for “preserving $ you rightfully earned + not letting the state ‘steal it’” or do u want to design policy to “create $ by incentivizing investment.”
“Your great grandkids would almost surely prefer the latter. Your rich grandpa might prefer the former. But I think these are questions of values.”
You’ll commonly hear hard currency people argue their purchasing power is being eroded + that’s morally wrong. They’re making a moral argument for why people should be able to store money under their mattress. That of means less VC, for ex.
in response:
in response:
"I like mild inflation because it encourages investment and doesn’t erode your purchasing power in practice bc you can invest passively and get the benefits of growing money AND all the cool shit those investments result in. "
curious to open a dialog (for others: no ad hominem attacks, strawmans, taking in bad faith, etc)
cc @CantHardyWait @real_vijay @danheld @arjunblj et al
cc @CantHardyWait @real_vijay @danheld @arjunblj et al
