Difference between revisions of "Parable of the ship: why Austrian Economics fails."
From Critiques Of Libertarianism
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::The owner of a ship noticed that his ship was filling with water. Being an educated man (if not nautically trained) he knew there were many possible causes for water in a ship: leaks in the hull, the bilge pump being broken, waves washing over, condensation, and even the crew urinating in the hold. He heard the bilge pump running, he saw water from waves pouring in the open hatches, but worst of all he smelled urine in the hold! Being sensible, he ordered the crew to shut the hatches and then gave them a lengthy, stern harangue on hygienic use of the head. While he was lecturing the crew, his ship sank due to a combination of causes: large, unobserved leaks in the hull, a bilge pump that was running but not pumping correctly, and condensation that had shorted out warning circuitry. | ::The owner of a ship noticed that his ship was filling with water. Being an educated man (if not nautically trained) he knew there were many possible causes for water in a ship: leaks in the hull, the bilge pump being broken, waves washing over, condensation, and even the crew urinating in the hold. He heard the bilge pump running, he saw water from waves pouring in the open hatches, but worst of all he smelled urine in the hold! Being sensible, he ordered the crew to shut the hatches and then gave them a lengthy, stern harangue on hygienic use of the head. While he was lecturing the crew, his ship sank due to a combination of causes: large, unobserved leaks in the hull, a bilge pump that was running but not pumping correctly, and condensation that had shorted out warning circuitry. | ||
| − | Now, it's easy to write a story to justify or ridicule any course of action, any philosophy. Indeed, that describes Ayn Rand's fiction. But my purpose here is to illustrate ways in which the owner failed to think correctly. Ways which are STRONGLY analogous to Austrian economic methodology. | + | Now, it's easy to write a story to justify or ridicule any course of action, any philosophy. Indeed, that describes Ayn Rand's fiction. (Indeed, there are MANY parables of the ship by many authors.) But my purpose here is to illustrate ways in which the owner failed to think correctly. Ways which are STRONGLY analogous to Austrian economic methodology. |
In every theory-rich subject, there can be a multitude of explanations of cause. For example, there might be 5 possible causes for a specific problem, be it inflation or disease or whatever. All or none of those causes might be valid. If all of them are valid, some might be unimportant because they cause very little of the problem or cause the problem very infrequently or cause the problem only under specific circumstances. But more than one of the causes might be quite important, singly or in combination. Economics is just such a theory-rich subject. | In every theory-rich subject, there can be a multitude of explanations of cause. For example, there might be 5 possible causes for a specific problem, be it inflation or disease or whatever. All or none of those causes might be valid. If all of them are valid, some might be unimportant because they cause very little of the problem or cause the problem very infrequently or cause the problem only under specific circumstances. But more than one of the causes might be quite important, singly or in combination. Economics is just such a theory-rich subject. | ||
