EconPapers    
Economics at your fingertips  
 

The Varieties of Subjectivism: Keynes and Hayek on Expectations

William Butos and Roger Koppl ()

Method and Hist of Econ Thought from University Library of Munich, Germany

Abstract: J.M. Keynes and F.A. Hayek had different economic ideas even though both were subjectivists seriously engaged with issues of time and uncertainty in economics. The source of the difference between their economic ideas was the difference between their philosophical ideas. Keynes was a Cartesian rationalist and justificationist; Hayek a critical rationalist and non-justificationist. We draw on Keynes's "A Treatise on Probability," Hayek's "The Sensory Order," and other works to defend our argument. Although Keynes and Hayek might both be called "subjectivists," there are varieties of subjectivism. Their subjectivist ideas are not fully compatible with one another and conduce to different theories of the market process. Hayek's theory, not Keynes's, allows us to say when markets will behave in the way Keynes described and when they will instead behave in more coordinated ways. In this sense, a Hayekian theory is needed to understand a Keynesian world.

Keywords: Subjectivism; uncertainty; expectations; Keynes; Hayek; philosophy; epistemology; probability (search for similar items in EconPapers)
JEL-codes: B (search for similar items in EconPapers)
Date: 1995-05-16, Revised 1995-05-17
Note: wp5.1 file, forthcoming, Summer 1997, History of Political Economy
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (18) Track citations by RSS feed

Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/mhet/papers/9505/9505001.pdf (application/pdf)
https://econwpa.ub.uni-muenchen.de/econ-wp/mhet/papers/9505/9505001.ps.gz (application/postscript)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpmh:9505001

Access Statistics for this paper

More papers in Method and Hist of Econ Thought from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ().

 
Page updated 2019-08-02
Handle: RePEc:wpa:wuwpmh:9505001