Austrian school

(redirected from Austrian economists)

Austrian School

A school of economics that argues that human behavior is so complex it is extremely difficult or impossible to model. For that reason, it promotes deductive, as opposed to inductive, reasoning in its analysis. It is an extremely individualist school, advocating laissez faire policies and opposing all or nearly all government interventions in the economy. The Austrian School, and particularly its rejection of modeling, has faced criticism from both right- and left-leaning economists. It is so named because most of its founders were born in or around Austria. See also: Ludwig von Mises.

Austrian school

a group of late 19th-century economists at the University of Vienna who established and developed a particular line of theoretical reasoning. The tradition originated with Professor Carl Menger who argued against the classical theories of value, which emphasized PRODUCTION and SUPPLY. Instead, he initiated the ‘subjectivist revolution’, reasoning that the value of a good was not derived from its cost but from the pleasure, or UTILITY, that the CONSUMER can derive from it. This type of reasoning led to the MARGINAL UTILITY theory of value whereby successive increments of a commodity yield DIMINISHING MARGINAL UTILITY.

Friedrich von Wieser developed the tradition further, being credited with introducing the economic concept of OPPORTUNITY COST. Eugen von Böhm-Bawerk helped to develop the theory of INTEREST and CAPITAL, arguing that the price paid for the use of capital is dependent upon consumers’ demand for present CONSUMPTION relative to future consumption. Ludwig von Mises and Friedrich von Hayek subsequently continued the tradition established by Carl Menger et al. See also CLASSICAL ECONOMICS.

References in periodicals archive ?
The belief that I almost exclusively argue that the business cycle is due to changes in spending and profit might also come from the fact that I do place greater importance on changes in the rate of profit, relative to interest rates, in causing changes in investment than Austrian economists generally do.
DiLorenzo and Block are among the most prolific and loved of modern Austrian economists.
Free competition based on private property rights, which is also a theory developed by the Austrian economists means that any individual or firm can enter in the production of goods and services for the consumers.
Austrian economists, on the other hand, view equilibrium as an imaginary construct, consistent with an evenly rotating economy where human action ceases.
But did the Chicago and Austrian economists also have too much confidence in markets?
One question that often arises is why most Austrian economists are much more libertarian minded than the rest of the profession.
In the small but feisty emerging community of academic Austrian economists, Garrison was omnipresent and played a significant role in navigating a "middle ground" for those inspired to do research in the Austrian tradition.
This is what the Austrian economists say while commenting on the destruction wrought by the Chicago economists during the last three decades.
Addressing the national deficit does not necessarily fix the problems of national debt--only tax reform and demanding that Congress, which actually controls the budget and all fiscal allocations not the President, act responsibly instead of following the failed economic policies of pre-WWII Austrian economists.
Rand agrees with the Austrian economists that the concept of value is only meaningful in relationship to some valuing consciousness.
He notes that Austrian economists recognize that the free market facilitates economic order resulting from a multitude of decisions made by individual entrepreneurs, capitalists, workers, landowners, and social organizations, not from the result of a central economic plan.
This is important because Austrian economists mostly focus on the role of market prices in shaping economic processes.

Full browser ?