In the world of economics, there is certainly no shortage of misinformation. Countless theories that at first glance seem intuitively obvious are in fact slightly more ambiguous, misleading or just simply wrong. The goal of this blog is to clear up some of the fog created by the jargon and nuanced data set forth in the realm of fiscal and monetary policies.
The effectiveness of any policy should be judged on the basis of whether the means actually reaches its end. Thus, a critical measure of any good economist is being able to predict the long-run unseen consequence of a program, not just the observable immediate outcomes. The great difficulty inaccurately making these predictions is that in almost any instance there are many different moving factors contributing to any one piece of data. However, our constant need to view economic policies as black and white has time and again led to unexpected downturns and has hindered economic progress. This blog will hopefully demonstrate that the economy is far too complex to deduce to simple models and analytical tools and that we cannot simply turn dials and breed results we want without daunting inadvertent implications.
The economic principles in this blog are derived from the lessons of Austrian economics spanning from the teachings of Carl Menger to those of Ludwig von Mises and Friedrich Hayek. As the oldest continuous school of economic thought, I hope theses ideologies will shed some light on the nuances in this dense social science.
“There is only one difference between a bad economist and a good one: the bad economist confines himself to the visible effect; the good economist takes into account both the effect that can be seen and those effects that must be foreseen.”
– Frederic Bastiat, That Which is Seen, and That Which is Not Seen, 1850