The Rebirth of Austrian Economics: 1974–99

Twenty five years ago, Austrian economics appeared to be a 'closed chapter in the history of economics.' Today Austrian ideas are flourishing as never before. That is partly due to the compelling nature of Austrian ideas. But there is a good case for arguing that the 'official rebirth' of Austrian economics dates back to a meeting in South Royalton, Vermont in June 1974.     

Must Capitalism Yield to Socialism?

Why did a brilliant economist who favoured capitalism argue that it would be replaced by socialism because of its very success? Professor Kirzner, an authority on Austrian economics, rejects the capitalism-is-doomed hypothesis of the Austrian Joseph Schumpeter, author of Capitalism, Socialism and Democracy.     

新奥法隧道施工技术

隧道修建技术随着大规模的地下工程建的开展而得到了不断提高,在此基础上出现了新奥法、挪威法、浅埋暗挖法等更有效的施工方法;本文结合工程实例,对在隧道施工中应用的新奥法施工技术加以介绍。     

Corporate venturing and the rent cycle

This study views entrepreneurial rents as renewable opportunities and explores how firms can effectively utilize corporate venturing to create and sustain economic rents. Schumpeterian entrepreneurs create rents by harnessing corporate venturing to exploit attractive economic opportunities. The Schumpeterian rent is composed of Ricardian and Austrian rents. Ricardian rents result from unique and non-reproducible characteristics or competencies of the firm, and hence, are not appropriable by imitators. Conversely, Austrian rents, or economic profit, are subject to dissipation by imitators and attract entry by competitors or Austrian entrepreneurs until they are bid to zero or destroyed by another Schumpeterian innovation. In this formulation, Austrian entrepreneurs are modeled as infra-marginal rent seekers. Consequently, to sustain rents, firms must cycle between using corporate venturing to create or discover Schumpeterian entrepreneurial opportunities and using venturing as a mechanism to exploit existing rent generating opportunities.     

Theory and history in marketing

This article presents a theoretical foundation for marketing based on the ideas of the Austrian school of economists. After a discussion of the methodological foundations of Austrian economics, which reject the statistical and experimental methods of the physical sciences as the means to verify theory in the social sciences, the article presents the Austrians' principle of methodological individualism, which provides the basis for a theory of entrepreneurship and marketing.     

Schumpeterian Dynamics Versus Williamsonian Considerations: A Test of Export Intermediary Performance

Using a sample of export intermediaries connecting domestic producers and foreign buyers, the study tests competing hypotheses on firm performance derived from the Austrian and transaction cost perspectives. Specifically, the Austrian perspective suggests that the more distant the export market and the more complex the product that the intermediary specializes in, the better its performance. Transaction cost theory, on the other hand, offers conflicting predictions. Our results indicate that these two theories are complementary to each other, and a contingency framework is proposed and discussed.     

The New Economic Sociology of Prices: An Analysis Inspired by the Austrian School of Economics

The new economic sociology includes some reference studies on the sociology of prices. They have not until now been studied by economists, and this article attempts to fill that gap by offering a detailed analysis, inspired by the Austrian School of Economics, of their object and approach. We first show that, from a theoretical point of view, the explanations advanced by these sociologists are based implicitly on basic models of economics, such as the “law of supply and demand” and the “law of costs,” and that they cannot therefore replace economic explanations of prices. Secondly, from a methodological point of view, these studies are based on field surveys that provide concrete information on certain markets but they lose sight of an aspect that is fundamental to the Austrian School, the interdependence of prices in different markets. And when this interdependence is taken into account, namely, in the case of the relationship between cost and price, the causal link postulated by sociologists goes from cost to price when Austrian economists argue that it goes in the opposite direction.     

The Business Cycle

A bstract . Conventional macroeconomics lacks a warranted explanation of the major business cycle, while the Austrian and geo-economic Georgist) schools have incomplete theories. A geo-Austrian synthesis, in contrast, provides a potent theory consistent with historical cycles and with explanations about the root causes. The geo-economic and Austrian schools have had little interaction in the past, despite many similarities (Yeager, 1954 and 1984). Though the theories of the schools are largely complementary, each providing content the other lacks, so far a synthesis has not been forthcoming; although some geo-economists have incorporated elements of Austrian capital theory (e.g., Gaffney, 1994).     

浅述岩体力学参数监测在隧道施工中的重要性

采用新奥法进行隧道工程施工时,设计单位只能根据监控单位和施工单位反馈的监控数据和隧道开挖揭露情况对设计的合理性进行宏观判断,隧道设计时应把力学计算和实际背景岩体力学参数相结合,才能更科学、经济的按照新奥法的理念完成隧道工程的设计、施工。     

Professor Ludwig M. Lachmann (1906-1990): Scholar, Teacher, and Austrian School Critic of Late Classical Formalism in Economics

Ludwig M. Lachmann was born in Berlin in 1906 and died in Johannesburg in 1990. For more than forty years, until his retirement in 1972, Lachmann established himself as a prominent South African economist and for a time served as head of the economics department at the University of Witwatersrand. From 1974 to 1987, he worked with Professor Israel Kirzner in New York City to give new shape and life to the older Austrian school of economics. Lachmann influenced a small army of modern Austrians to discard the elaborate formalisms of orthodox economics for a "radical subjectivism" that had its roots in the teachings of the founder of the Austrian school, Carl Menger. Here a small platoon of scholars offer their thoughts about Lachmann, his contributions to economic reasoning, and his eccentric but engaging character. First hand reports explain what their mentor taught and what his students took away. Lavoie makes the case that Lachmann's "radical subjectivism" took a rhetorical turn toward the end of Lachmann's career in New York City. In addition, Kirzner reports on his long and most productive relationship with Lachmann and provides additional insights about the seminal role of the Austrian Economics Seminar at New York University from 1985 to 1987 in giving shape to the modern Austrian revival. This article is the written version of a "Remembrance and Appreciation Session" held on June 28, 1999 at the History of Economics Society meeting at the University of North Carolina in Greensboro. It is one of an ongoing series that appears in the July issues of this journal.     

Revisiting the Concept of Schools of Thought in Economics: The Example of the Austrian School

The aim of this article is to explore defining characteristics of schools of thought in economics, with Austrian economics chosen to illustrate some of the themes raised. This article argues that a school of thought can be interpreted as an entity that comprises both a system of thought and its member practitioners. Furthermore, a school of thought presupposes the existence of two elements: coherence and distinctiveness. Despite the existence of Misesian and Hayekian strands and thus of plurality within the Austrian school, the article argues for the existence of a broader notion of coherence within the Austrian school at the level of epistemology, methodology, and agenda/objectives.     

Forecasting Austrian national elections: The Grand Coalition model

Forecasting the outcomes of national elections has become established practice in several democracies. In the present paper, we develop an economic voting model for forecasting the future success of the Austrian ‘grand coalition’, i.e., the joint electoral success of the two mainstream parties SPOE and OEVP, at the 2013 Austrian Parliamentary Elections. Our main argument is that the success of both parties is strongly tied to the accomplishments of the Austrian system of corporatism, that is, the Social Partnership (Sozialpartnerschaft  ), in providing economic prosperity. Using data from Austrian national elections between 1953 and 2008 (n=18$n=18$), we rely on the following predictors in our forecasting model: (1) unemployment rates, (2) previous incumbency of the two parties, and (3) dealignment over time. We conclude that, in general, the two mainstream parties benefit considerably from low unemployment rates, and are weakened whenever they have previously formed a coalition government. Further, we show that they have gradually been losing a good share of their voter basis over recent decades.     

An Austrian Analysis of China's Unsustainable Boom

Austrian Business Cycle Theory can shed light on the ways in which the current Chinese economic boom is unsustainable. On the one hand, government interventions, such as land monopolies, have raised costs for real estate developers. By limiting the availability of investment instruments and access to external markets, government interventions have created a strong demand for housing as a hedging tool. On the other hand, a loose monetary policy and artificially low interest rates have made the property market tempting for developers. Over‐construction and over‐consumption in the housing sector epitomise the capital structure analysis that Austrian economists regard as the core of their business cycle theory.     

A subjectivist essay on modern labor economics

Subjectivist methodology has attracted an increasing number of adherents as a result of the recent reemergence of the Austrian school. The new Austrian school has challenged the methodological approach of neoclassical economics in many areas. This essay seeks to extend that challenge into the area of labor economics. Modern labor economics, viewed from a subjectivist perspective, is argued to merit a mixed review. However, it is also argued that neoclassical labor economists (as compared with neoclassicists in other specialized areas) seem quite amenable to incorporation of subjective elements into their analysis.     

Cointegration in a macroeconomic system

This paper investigates the long-run relationships within a set of six quarterly time-series on the Austrian economy by means of cointegration. After analysing the univariate properties, especially with respect to the appropriate seasonal filter, the maximum-likelihood method proposed by Johansen (1988) is applied to estimate and test the cointegrating relationships. We found three such relations, implying that the system is driven by three independent stochastic time trends. In a next stage we investigate whether the empirically determined cointegrating relationships are compatible with implications derived from the neoclassical growth model with exogenous stochastic technical progress. It is found that the Austrian data strongly reject the propositions that the real interest rate and the log ratios of consumption to output, investment to output, and the real gross wage sum to output are stationary.     

The interplay between regulation and efficiency: Evidence from the Austrian hospital inpatient sector

The Austrian health policy aims to maintain and even expand high-quality health care. The implementation of an integrated master plan, which contains input and output target values for the overall health care system, is an important regulatory intervention. To support the regulatory authorities, efficiency studies that simultaneously reveal input and output improvement potential can be promising. To serve this purpose, we computed bootstrapped non-oriented super-efficiency measures to identify any improvement potential in inputs and outputs for the Austrian hospital inpatient sector for four years. Variations in hospital efficiency were investigated using non-parametric post-efficiency analyses.     

THE ESSENCE OF THE AUSTRIAN SCHOOL

In a lecture in November 2008, Professor Huerta de Soto set out the key contributions of the Austrian School to economic thought.     

TESTING TIMES FOR CENTRAL BANKS – IS THERE ROOM FOR AUSTRIAN IDEAS AT THE TOP TABLE?

Central banks are facing an unprecedented test in the wake of the credit crisis. We briefly outline prevailing theoretical frameworks and argue that central bankers effectively have a choice between three separate frameworks: Vienna, Cambridge and Chicago. Despite Austrian economics being the least acknowledged we survey increasing exposure in mainstream media, suggesting a role for a more explicit use. We provide implications for policy‐makers and claim that Austrian ideas have a place at the top table of policy debate.     

Interpreting the Great Crash of 1987

Professor Norman Barry of the University of Buckingham presents a view of the Crash from the perspective of Austrian economics.     

对杜家山千枚岩公路隧道施工经验的深思

结合广甘高速千枚岩隧道的施工经验,认为在设计与施工过程中要充分利用地勘资料;认为"新奥法"并不是隧道唯一的施工方法,要根据围岩的特性分别采用相适应的施工方法。