Gold! Always believe in your soul, you've got the power to know...

November 3, 2008 7:54 AM

I am basing my Masters in International Business thesis on Prof. Barry Eichengreen's 1998 paper, 'Does Mercosur Need a Single Currency?' Although by no means an expert, I've been interested in the Austrian School for a long time and, as a result, am instinctively distrustful of central banks and fiat money. Can anyone direct me to any reputable, well-written and persuasive essays arguing the inherent weaknesses of currency unions in relation to this?

I'm also keen to read any persuasive essays able to stand up to close scrutiny that successfully argue a reintroduction of the Gold Standard.

I know many economists dismiss Austrian economics as voodoo science, so I don't wish to get involved in an academic discussion.

Any help would be greatly appreciated.

posted by Zé Pequeno to work & money (2 answers total)

I'd also love to know from people what themes they think would warrant a chapter. I'm still in the very early stages, and I'm not exactly straight about what I want to look at yet.
posted by Zé Pequeno at 7:57 AM on November 3, 2008

You should read Philip Mirowski's More Heat than Light: Economics as Social Physics, Physics as Nature's Economics. You won't find an argument that Austrian economics isn't voodoo, but you will find an argument that it isn't any more voodoo than the rest of it is. I'm taking a class from him now, and he made the comment:

"It ain't easy being a Marxist. There's a lot of shit you gotta hide."

When that provoked a giggle from the class, he turned around and said:

"But don't think it's any easier being a neoclassical. You gotta hide a lot of shit there too."

Mirowski would not argue that the gold standard avoids the "problems" of fiat money, but that it really isn't all that different from fiat money. He'd then argue that fiat money has problems not because it's subject to fiat (as is the gold standard), but the people doing the fiat-ing don't have a clue about the problems inherent in their models (just like those who advocate the gold standard).

If you're looking for serious academic research that says that the gold standard really is a superior monetary model, good luck. I don't think there are any non-cranks who believe that anymore.
posted by valkyryn at 8:24 AM on November 3, 2008