Quarterly Journal of Austrian Economics

Provides articles that "promote the development and extension of Austrian economics and to promote the analysis of contemporary issues in the mainstream of economics from an Austrian perspective."


Vol. 13, No. 1, Spring

Factor Prices under Monopoly1
ABSTRACT: This paper explains how grants of monopolistic privileges to capitalists can lower labor and land factors' prices compared to what would prevail in a free market environment. Monopoly gains of privileged business owners are not only "extracted"...
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Cyclical Capital Stock1
ABSTRACT: It is common to assume in business cycle analysis that the capital stock is homogenous and constant in aggregate value. We explore the alternative concept that capital is heterogeneous, and whether it exhibits cyclical changes. A multiperiod...
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Austrian Business Cycle Theory and the Global Financial Crisis: Confessions of a Mainstream Economist
ABSTRACT: Austrian business cycle theory has a legitimate claim to being the most authoritative explanation of the recent global financial and economic crisis. Indeed, many mainstream economists have begun to analyze the crisis, perhaps unwittingly so,...
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Choice and Indifference: A Critique of the Strict Preference Approach
ABSTRACT: We examine the strict preference approach to the interpretation of human action and the assertion that a choice cannot be made between actions in which the actor is indifferent to the outcomes. We show that this view is incompatible with decision...
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The Corporate Income Tax: An Entrepreneurial Perspective1
ABSTRACT: While corporate income taxation is a major issue in the debate over international finance, economic theory has no clear stance on who bears its burden. On balance, economists seem still more prone to accept that taxing profits does not affect...
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Vol. 12, No. 4, 2009

Robbins as Innovator: The Contribution of an Essay on the Nature and Significance of Economic Science
Lionel Robbins's An Essay on the Nature and Significance of Economic Science (1932) made at least three important contributions: (1) constructing a more modern, focused, and general definition of economics, which continues to inform the best contemporary...
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Murder and Inflation in Kentucky
ABSTRACT: This paper tracks the economic and political developments in the state of Kentucky that led up to the murder, trial, and execution constituting "The Kentucky Tragedy," and to a second murder involving a son of the Governor of the state. In...
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Geography as Causal in Societal Ascendance: An Austrian Retrospective on Diamond
ABSTRACT: In his 1997 book, Guns, Germs and Steel, Jared Diamond attributes the ascendancy and triumphs of certain societies to geographical and environmental advantages. But given the conditions of geography and environment, Diamond advances the misguided...
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The Quality of Money
ABSTRACT: Much has been written about the quantity of money and its effects on money's purchasing power. However, changes in the quality of money have been widely neglected. This paper analyzes changes in the quality of money and its influence on the...
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Entrepreneurship, Economic Evolution, and the End of Capitalism: Reconsidering Schumpeter's Thesis
ABSTRACT: This paper seeks to explore and to critically evaluate, from an economic standpoint, Joseph Schumpeter's theory of the decline of capitalism, as put forward in his Capitalism, Socialism, and Democracy. It begins by exploring and criticizing...
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The Enduring Significance of Robbins
In his comprehensive The Growth of Economic Thought, Henry William Spiegel identifies (1991, p. 536) Carl Menger's methodological studies as "the beginning of a period in which economic theory was largely identified with microeconomics." Spiegel goes...
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Lionel Robbins: Neoclassical Maximizer or Proto-Praxeologist?
I. INTRODUCTIONAustrian economists writing after the so-called Austrian revival of the 1970s have generally been dismissive of Lionel Robbins's An Essay on the Nature and Significance of Economic Science (Robbins 1932), denying it a significant role...
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Vol. 12, No. 3, 2009

Ulrich Fehl's Contribution to Temporal Capital Theory
ABSTRACT: This paper briefly summarizes Ulrich Fehl's important contributions to Austrian capital theory. While his work is well known in Europe he remains a relative unknown to the English speaking world. The intent of this paper is to introduce Ulrich...
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Mises, Morgenstern, Hoselitz, and Nash: The Austrian Connection to Early Game Theory
ABSTRACT: This paper examines the connection between Ludwig von Mises and early contributors to game theory. What becomes clear is that early game theorists were trained by Austrians who thus influenced the field from its beginning. The connection most...
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Entrepreneurship and Economic Growth: The Theory of Emergent Institutions
ABSTRACT: This paper enlarges Menger's theory of the origins of money by making explicit the role of entrepreneurship in the theory and by extending the theory to market institutions other than money. Drawing on the research of anthropologists, archaeologists,...
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Well-Informedness and Rationality: A Philosophical Overview
ABSTRACT: There is a strong tendency in modern moral philosophy to impose restrictions on the range of desires that are to count as genuinely contributive to the desirer's welfare. Perhaps the most frequent among such proposals is that only appropriately...
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The Economic Theory of Bureaucracy: Insights from the Niskanian Model and the Misesian Approach
ABSTRACT: Governmental interventions in the economy take numerous forms, and they require the existence of a public authority, a bureaucracy, to implement them. This article proposes an analysis of the origins and the dynamics of bureaucracy, and discusses...
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Vol. 12, No. 2, 2009

Fama's Efficient Market Hypothesis and Mises's Evenly Rotating Economy: Comparative Constructs
ABSTRACT: Mises created an artificial construct, the evenly rotating economy (ERE), from which to ascertain the source of entrepreneurial profit and loss. In particular, the ERE is characterized by two distinct elements. First is the elimination of the...
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Say's Law and the Austrian Theory of the Business Cycle
ABSTRACT: Economists have tried to explain business cycles as well as fluctuations in the economy, but over the past two centuries, the explanations have fallen into two areas. The first area tries to explain business cycles as being the result of fluctuating...
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Comment on "A Capital-Based Theory of Secular Growth"/a Capital-Based Theory of Secular Growth: Reply to Engelhardt
The distinguishing feature of a recipe is that, once learned, it generally does not have to be learned again.- Murray N. Rothbard (2009, p. 11)Andrew Young (2009) suggests a capital-based theory for secular growth that is consistent with Austrian capital...
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Cantillon and the Invisible Hand
ABSTRACT: The invisible hand remains an important foundation of economic analysis, continues to be a source of new analytical and explanatory devices, and is the conceptual basis of a whole class of scientific models throughout the sciences. Indeed,...
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The Myth of the Rational Voter: Why Democracies Choose Bad Policies
THE MYTH OF THE RATIONAL VOTER: WHY DEMOCRACIES CHOOSE BAD POLICIES. BY BRYAN CAPLAN. PRINCETON, N.J.: PRINCETON UNIVERSITY PRESS, 2007.Democracy supposedly protects citizenries from "harmful" policies, but in fact produces and entrenches them. Bryan...
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The Age of Turbulence: Adventures in a New World
THE AGE OF TURBULENCE: ADVENTURES IN A NEW WORLD. BY ALAN GREENSPAN. NEW YORK: PENGUIN PRESS, 2007.Ex-Federal Reserve Board Chairman Alan Greenspan concedes a major point to market-based scholars near the end of his autobiography (p. 478): the Fed's...
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Profit and Production
ABSTRACT: Profits and losses provide powerful incentives. This essay explores the roles of profits and entrepreneurs in a market economy. In a market with secure private property rights, profits are a reliable guide that directs productive activity....
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Vol. 12, No. 1, 2009

100 Percent Reserve Money: The Small Change Challenge
Abstract: In a free market economy from which fiduciary media are excluded, economic progress will be limited, perhaps severely, by the high cost and correspondingly limited supply of small-denomination money-money that is needed to accomplish retail...
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Product Differentiation and Economic Progress
ABSTRACT: In neoclassical theory, product differentiation provides consumers with a variety of different products within a particular industry, rather than a homogeneous product that characterizes purely competitive markets. The welfare-enhancing benefit...
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A Capital-Based Theory of Secular Growth
Abstract: Roger Garrison (2001) provides a welcome diagrammatic exposition of Austrian, capital-based macroeconomics. The exposition attempts to account not only for Austrian Business Cycles (ABCs), but also for long-run, secular growth. Secular growth...
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Rejoinder to Hoppe on Indifference
Hoppe (2005, p. 87) quite properly starts out his analysis of indifference with a magnificent quote from Rothbard (1997, pp. 225-26) on this subject:Indifference can never be demonstrated by action. Quite the contrary. Every action necessarily signifies...
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Further Notes on Preference and Indifference: Rejoinder to Block
In response to Block's foregoing criticism of my previously published note on the subject of preference and indifference in economic analysis, I will first summarize our agreements. Then I will reconstruct our differences in the form of a fictive dialogue...
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A Note on Cartels
Cartels, characterized by activities such as simultaneous price increases or decreases, or virtual price identity at almost the same time, without explicit communications or agreements, have long been discussed. For the first time, the price leadership...
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Valentin De Foronda: Liberty, Property, and Security
An eminent figure of the Spanish Enlightenment, Valentin Tadeo Echavarri de Foronda (1751-1821) summarizes in his works the expectations and the disillusionment of a generation balanced between ideals of liberal reforms and the claims of restoration....
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The Subprime Solution: How Today's Global Financial Crisis Happened, and What to Do about It
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Fiscal Sociology and the Theory of Public Finance
FISCAL SOCIOLOGY AND THE THEORY OF PUBLIC FINANCE. BY RICHARD E. WAGNER. CHELTENHAM, U.K.: EDWARD ELGAR, 2007.Economic theories of the state have traditionally been divided into two camps under the headings of public finance and public choice (cf. Buchanan...
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