The federal government should take economics lessons from Robinson Crusoe. At lease that's what a group of staunch free-market defenders concluded when they met in Claremont, Calif., recently. About 50 economists and 30 students attended the week-long conference. In an age when most economists turn to calculus and statistics for answers, Austrian economists prefer to rely on logic and deductive reasoning, peppered with colorful metaphors.
Followers say they practice economics that is literary, accessible, and relevant to the real world.
Carl Menger, an economist from the University of Vienna, founded the Austrian school in the 1970s. Though it soon sank into obscurity in Europe, its ideas were kept alive through the efforts of F.A. Hayek and Ludwig von Mises, both of whom taught in the United States and became the school's main contributors. When Mr. Hayek won the Nobel Prize in Economics in 1974, the Austrian school received renewed attention. Even Federal Reserve Board Chairman Alan Greenspan has given speeches leaning toward some of the Austrian's positions. A leader of the Austrian movement, Murray Rothbard, an economics professor at the University of Nevada in Las Vegas, says he remembers when economics journals were literary.