Viennese kaleidics: Why it’s liberty more than policy that calms turbulence

Abstract

The idea of a kaleidic economy or society is strongly associated with George Shackle and his vision of Keynesian kaleidics. This essay asserts that the central thrust of the Austrian tradition in economic analysis can be described by the term Viennese kaleidics. In either version of kaleidics, the analytical stress is placed on treating time seriously and not just notionally. Either version of kaleidics leads to recognition that economic processes are better treated as turbulent than as equilibrated. While that turbulence is a natural feature of the unavoidable incompleteness of intertemporal coordination, it is subject to mitigation. This essay explains how it is that individual liberty and private ordering is generally superior to state policy and public ordering in calming the turbulence that naturally characterizes a kaleidic economy.

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Fig. 1

Notes

  1. 1.

    In contrast to the Austrian critics of what they perceive to be the nihilism of kaleidics, Stephen Parsons (1993) argues that it is orthodox economics, with its readiness to embrace fictive models that give definitive answers to questions that is nihilistic. Warren Samuels (1993) notes that if the charge of nihilism is applied to any system of thought that leaves the future open, nihilism is superior to the alternative.

  2. 2.

    In their examination of the scholarly oeuvre of Elinor and Vincent Ostrom, Aligica and Boettke (2009) explain that the Ostroms sought to penetrate deeply into reality in contrast to the Walrasian-like posture of achieving separation from reality.

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Correspondence to Richard E. Wagner.

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This is a revised text of my presidential address to the Society for the Development of Austrian Economics, Washington, DC, November 20, 2011. I’m grateful to Peter Boettke for offering helpful comments on an earlier version.

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Wagner, R.E. Viennese kaleidics: Why it’s liberty more than policy that calms turbulence. Rev Austrian Econ 25, 283–297 (2012). https://doi.org/10.1007/s11138-012-0172-x

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Keywords

  • Kaleidic economy
  • George Shackle
  • Time and economics
  • Monetary non-neutrality
  • Private vs. public ordering

JEL Codes

  • B20
  • D20
  • D80
  • E30
  • E52
  • E62