Recessions don’t instantaneously purge the economy of malinvestments, and booms can be created at will–use some logic, and get the necessary conclusion. The mainstream has a real problem with the element of time. Your neoclassical training is preventing you from understanding/conceptualizing dynamics.
Esuric,
Well, since its so obvious it should be easy for you to grab a source that explains your point in more detail to help me understand. [;)]
Thanks for the help! I greatly appreciate it. [H]
PS* Remember if its a book, dont forget the page numbers or chapter. That would really help as well.
So, essentially, you’re looking for an appeal to authority. Is this necessary?
lol Don’t be so defensive.
I have never seen anything like what you describe in the literature on ABCT and I would like to understand it better as part of my goal of better understanding ABCT as a whole.
So, yes, articles and/or books are necessary. I am not interested in debating you or anyone else on this subject, I am just interested in learning about ABCT (and more relevant to this thread, how it may or may not relate to understanding the US postwar economy). For me, that means reading someone that considered the issue, gathered supporting evidence, and submitted their arguments to peer-review.
I know that may sound elitist, that I don’t equally value the arm-chair theorizing of everyone with an internet connection, but I am okay with that lol. [H] Johnathan makes an excellent point that essentially boils down to the fact that internet forums are simply not the place for communicating original research and I have to agree.
I mean no offense by this, its just the way I am. So if you are looking for a “fight”, you’re probably looking at the wrong guy. Like I said in my very first post, I just want some things to read to help me answer a question I have (believe it or not, this is just something I am curious about, I don’t get paid to study the Post-WW2 economy or to win arguments on the interweb).
lol This has to be my 4th or 5th post just re-explaining what I am looking for and I am getting the vibe you are getting emotionally invested in this. So if you were wanting to fight, I’ll just concede that you won. But, hey, if you do come across any of those sources explaining your points in debt, I would gladly take that as a consolation prize. [:P]
Cheers, mate! [ap]
Student,
In my opinion, you are heading in the wrong direction. If you want to understand ABCT, you’re going to have to become more familiar with the relevant economics before you consider to test the theory by applying historical and empirical data. Otherwise, you’re never going to acquire the tools to thoroughly and objectively evaluate any of these research papers that you are looking for.
Well, I am not actually trying to test the theory. I think the post-WW2 economy does pose interesting questions for ABCT, but I agree that I am not the person to evaluate what the answers to those questions should be. So I was hoping to find articles by trained Austrian economists to see what they were thinking.
As described in the article, the economic intervention during WW 2 was massive. This intervention was released, for the most part, after the war. In short, the recovery could be at least partly attributed to the end of wartime planning. This may not directly address your question regarding ABCT, but I believe it is important to consider. (no need to reply to me regarding this, I’m not able to debate you. I just thought this article is relevant to the conversation.)
http://www.thefreemanonline.org/columns/the-1946-voter-revolt-against-government-regulation/
Austrians weren’t expecting a massive depression in the post-war economy, it was the Keynesians that did.
Robert Higgs explains this. Pretty sure there’s a vid on Youtube split up into parts, titled “Myth of War Prosperity” or something like that. The GDP of the nation declined greatly but the private sector grew by 30%(the greatest ever in American history). The reason the private sector grew was because the government massively cut spending and lifted many controls, thus allowing the private sector to grow because it stopped crowding it out as much.
Furthermore, you can have misallocation of resources but you don’t necessarily need large amounts of unemployment as long as wages are not interefered with (no minimum wage means people can adjust their wage preferences downward and thus still be able to find jobs even if resources are still misallocated).
edit - here’s part one of the vid series (since i dunno where the vids are on the mises site)
"Myth of War Prosperity (Part 1 of 5)
I don’t know of any peer reviewed work on the specific event that interests you. But I think you put too much emphasis on the mis-allocation of capital. It is easy to do because it is so profound and different from any other theory. However, there have been many bank panics in our history, even when we had a gold standard, because of fractional reserve banking. By the way, the gray lines in the fed’s chart above indicate recession. So, reasonable people can believe that there was one after 1945 as indicated.
In The Politically Incorrect Guide to the Great Depression and the New Deal. By Robert P. Murphy, Dr Murphy explains that before the great depression, the economic problems following a bust rarely lasted more than 18 months. The great depression was 100% caused by government intervention that prevented economic recovery.
It is well known that during WWII everything that was not rationed directly had its price set by a central bureaucracy in the USA and most other countries. Thankfully FDR was dead when the war ended. So they did not have him trying to continue and extend the new deal. Instead, people who had endured 15 years of hell on earth were able to dismantle most of the government and set people free. The people took care of the rest. And the story was similar for most countries around the world.
There is an article about this period from an Austrian view. It is called, “The Great Depression of 1946.”
what does capital market liquidation. how does this play an effect in turning a factory of tanks into a factory for cars?
Could you reword that? I’m not sure what the “this” is that you’re asking about in the second sentence, and I’m not even sure the first sentence is actually a sentence. I honestly have no idea what that post is asking.