Most Market Criticism is Simply Poor Science

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Most Market Criticism is Simply Poor Science

January 7, 2016

“The market makes the rich richer, the poor poorer.” 

Most critiques of the market is pure assertion. Even claims based on empirical data (like Piketty) aren't actual findings. 

The reason is as obvious as it is overlooked: the real economy is heavily regulated, politically manipulated, and therefore distorted, and therefore not the actual “market.” Yet the market skeptics ASSUME it is. That's why  they find that “market” causes lasting inequality, environmental issues, etc. 

But the assertion is unfounded; to accurately trace the causes of observed effects/problems, scholars need to properly separate the market from political interference. This requires a good understanding of the market process in theory and practice, without which the market/state distinction (economic/political according to Oppenheimer (1908)), is blurred and unfit to use in research. 

Market skeptics, almost without exception, lack such understanding and therefore rely on poor measures, proxies, and inaccurate demarcations. That's why any results in such studies, which tend to blame “the market” for unwanted effects, should properly be classified as assertive. 

It is simply poor science.

Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.

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