The Chicago School Versus the Austrian School

0 Posted by - June 20, 2011 - Economics

friedmanmises The Chicago School Versus the Austrian School*Taken from the Ludwig von Mises Institute. Written by Robert P. Murphy.

People often ask me, “How are the Austrians different from the Chicago School economists? Aren’t you all free-market guys who oppose big-government Keynesians?”

In the present article I’ll outline some of the main differences. Although it’s true that Austrians agree with Chicago economists on many policy issues, nevertheless their approach to economic science can be quite different. It’s important to occasionally explain these differences, if only to rebut the common complaint that Austrian economics is simply a religion serving to justify libertarian policy conclusions.

Before jumping in, let me give a few obvious disclaimers: I do not speak for all Austrian economists, and in this article I will be discussing modern Austrian followers in the tradition ofLudwig von Mises and Murray Rothbard. (On methodology in particular, the Austrians in the Rothbardian camp differ somewhat from those who look more to Friedrich Hayek and Israel Kirzner for inspiration.) It’s also important to note that not every Chicago School economist thinks alike. Even so, I hope the following generalizations are representative.

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