Are You an Austrian, Axiomatic or Mainstream Economist?

Percy Greaves writes:

Economic research? What research? All the research has already been done by Mises. All that is left is to explain Mises to the public… The theory of money virtually begins and ends with Ludwig von Mises' monumental Theory of Money and Credit, published in 1912.

Murray Rothbard writes:

Before then it seemed that any attempt to apply marginal utility theory to money was inextricably caught in a circular trap… Mises, however, succeeded in solving this problem in 1912 by developing his so-called Regression Theorem.

Question 13: Which of these quotations about fiat money do you agree with?

a) "The continuance of confidence in the banks after going off the gold standard is something of a psychological marvel."

This is a Rothbard quotation.

In the quotation above he knew about Mises' Regression Theorem, but here he seems to have forgotten it. Most Austrians do the same, so this is the Austrian position.

I could dispense with most of Mises' work, but his Regression Theorem inspired my third axiom. This is one reason why I wrote in my Critique:

It would be more accurate to consider Menger and Mises forerunners of this author’s Axiomatic School while making Hayek the founder (and Böhm-Bawerk the forerunner) of the Hayekian School. Menger, Mises and this author are the only truly subjectivist economists.

Thus, for this reason and because Mises’ praxeological method and his regression theorem somewhat inspired this author’s postulate set, I insist on claiming Mises as my forerunner and on asking the economists now called “Austrians” (e.g. Garrison and Skousen) to call themselves Hayekians.

b) "Fiat money has value because it had value yesterday and people assume that it still has value today. It had value yesterday because it had value the day before yesterday, and so on. This is described by Mises' Regression Theorem."

This is a quotation of mine. I discuss the history of money in my Critique of Stephen Zarlenga on the Origin of Money

c) "When we refer to fiat money, we are referring to money that exists because the government declares it into existence."

This is a Ron Paul quotation.

This quotation is mainstream; what divides Austrian and mainstream economists is whether it implies the rest of Paul’s statement: “History has shown that fiat money, or ‘faith-based currency' always fails."

The three answers to question #13 contradict each other: (a) is ignorant of why people do, in fact, value fiat money; (b) correctly explains why they value fiat money; and (c) falsely attributes the government with the power to cause people to value things.

Note: To discourage crib sheets, the order of the answers varies every time someone takes the quiz, so yours may not be labeled a, b and c as shown.

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That was distracting, so I thought I'd try, try again.

Also, I have stats now for 1000, 1500 and 2000 responses. Since posting this seven hours ago, the Austrians have closed the 34 point lead enjoyed by the axiomatists. It is now a dead-even race:

All Answer Totals
Axiomatic = 641 || Austrian = 641 || Mainstream = 821 || Total = 2103

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Shaka, you so crazy! www.sniperflashcards.com