The Austrian Economics Wiki - User contributions [en]

Austrian Economics Wiki:2011 article improvement drive

2011-07-26T23:11:08Z

Catalan: starting it for now

The ''2011 article improvement drive'' is a Mises Wiki-wide writing competition open to all registered Mises Wiki members. The objective is to substantially improve Mises Wiki content, both in the number of topics covered and in the depth that these topics are discussed. Participants' work will be graded against a point system, by a panel of judges, and the member with the most points will be awarded a $50 gift certificate to the Mises Institute's bookstore.

==Judge panel==
* '''[[User:Catalan|JonCatalán]]'''<sup>[[User talk:Catalan|(Talk)]]</sup>

==Point system==

==Important articles==

Subjective Theory of Value

2011-07-22T15:09:52Z

Catalan: moved Subjective Theory of Value to Subjective theory of value: too much capitalization

#REDIRECT [[Subjective theory of value]]

Subjective theory of value

2011-07-22T15:09:52Z

Catalan: moved Subjective Theory of Value to Subjective theory of value: too much capitalization

(Work in progress)

The subjective theory of value is a doctrine of value discovered independently and nearly simultaneously by [[William Stanley Jevons]], [[Léon Walras]], and [[Carl Menger]].

Subjective theory of value

2011-07-22T15:09:02Z

Catalan: starting page

(Work in progress)

The subjective theory of value is a doctrine of value discovered independently and nearly simultaneously by [[William Stanley Jevons]], [[Léon Walras]], and [[Carl Menger]].

Fractional reserve banking

2011-02-23T05:20:07Z

Catalan: /* The Case For FRB */ free banking is two words

'''Fractional-reserve banking''' (or '''FRB''') is the widespread banking practice in which only a ''fraction'' of a [[bank]]'s [[demand deposits]] are kept in reserve and available for immediate withdrawal (as cash and other highly [[liquid assets]]), whilst the remaining cash is lent out to borrowers (and so is never actually available for immediate withdrawal to legitimate deposit-holders).<ref>''The Bank Credit Analysis Handbook: A Guide for Analysts, Bankers and Investors'' by Jonathan Golin. Publisher: John Wiley & Sons (August 10, 2001). ISBN 0471842176 ISBN 978-0471842170</ref><ref>[http://www.bankintroductions.com/definition.html Bankintroductions.com - Economic Definitions]
</ref><ref>[http://www.investopedia.com/terms/f/fractionalreservebanking.asp Investopedia economic definitions]</ref><ref>[http://www.investorwords.com/5581/fractional_reserve_banking.html investorwords economic definitions]
</ref> The bank in effect lends out most or even all of the funds it receives in demand deposits, whilst ''at the same time'' guaranteeing that all deposits are available for immediate withdrawal upon demand. Fractional reserve banking is currently legal and practiced by all commercial banks.

The practice of fractional reserve banking expands [[credit]] and therefore also expands the [[money supply]] (demand deposits and cash) beyond what it would otherwise be in a stable money system. Due to the prevalence of fractional reserve banking, the [[M2 (economics)|broad money supply]] (deposits created via the issuance of loans plus cash) is a much larger multiple than the amount of "real" [[Monetary base|paper currency]] created by the country's [[central bank]]. That multiple (called the [[money multiplier]]) is determined by the [[reserve requirement]] or other [[financial ratio]] requirements imposed by financial regulators, and by the [[excess reserves]] kept by commercial banks.

In legal terms, instead of a deposit being considered a bailment contract with the bank being the custodian of the funds deposited, banks since the 19th century have been allowed to consider the deposit (available for immediate withdrawal) "their money", and they are able to do with the money as they wish, provided they recognize the deposit as a general liability on their books of account.<ref name="De_Soto_reserves">Jesús Huerta de Soto. [http://mises.org/books/desoto.pdf "Money, Bank Credit, and Economic Cycles"]. 1. The Legal Nature of the Monetary Irregular Deposit Contract, p. 1-36, referenced 2009-11-07.</ref> The alternative to fractional reserve banking is "100% reserve banking" or "full reserve banking" where banks treat deposits in a similar way to allocated gold accounts, where the money cannot be lent out for extended periods of time as the money is held in trust on behalf of the client. In this system, only those funds from depositors who volunatarily kept their money with the bank for an extended period (so called "time depositors" or "term depositors") would be available for lending to third party borrowers.

==The Case Against FRB==
{{See also|Criticism of fractional reserve banking}}
There are moral, ethical and pragmatic economic arguments against the practice of fractional reserve banking.

Some ethicists and economists, such as [[Murray Rothbard]], [[Jörg Guido Hülsmann]]<ref>[http://www.amazon.com/gp/product/1933550090/ref=pd_sim_b_1/182-7638869-5654620 The Ethics of Money Production]</ref> and [[Jesus Huerta de Soto]]<ref>[http://mises.org/daily/3300 International Monetary Reform]</ref> consider the practice to be a form of recursive embezzlement and therefore a form of theft against legitimate deposit-holders and a form of counterfeiting against the monetary and property interests of the general populace - in particular savers who are deferring consumption and trying to avoid indebtedness.<ref>[http://mises.org/daily/4029 The Fed as Giant Counterfeiter]</ref><ref>[http://mises.org/daily/4499 The FRB Question]</ref>

The Ponzi or pyramid-like dynamics inherent in fractional-reserve banking allow early participants in financial bubbles to profit at the expense of genuine savers.<ref>[http://www.youtube.com/watch?v=VMngK0t5WkY $20 Trillion in Bad Debt], Max Keiser</ref><ref>[http://www.marketoracle.co.uk/Article25212.html The Faults of FRB], Thorsten Polleit</ref> For example, bankers and property developers who moved their money into Treasury bonds prior to 2008 made significant profits from the 2000s property bubble, but small businesses in the real economy suffered very high inflation (due to high housing costs) and economic disruption when the bubble burst, without being able to profit from the bubble.<ref>[http://mises.org/media/4014 The Economics of Legal Tender Laws], [[Jorg Guido Hulsmann]] (includes detailed commentary on [[fractional reserve banking|FRB]])</ref><ref>[http://mises.org/store/Money-Bank-Credit-and-Economic-Cycles-P290C0.aspx Money, Bank Credit and Economic Cycles], Jesus Huerta de Soto, Mises Institute ISBN: 978-1-933550-39-8</ref><ref>[http://mises.org/store/Meltdown-P557.aspx ''Meltdown''], Tom Woods, Regnery Press ISBN: 9781596985872</ref><ref>[http://www.nakedcapitalism.com/2010/12/matt-stoller-end-this-fed.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29 End This Fed], Matt Stoller</ref><ref>See the critique made in [http://www.bilderberg.org/monref.htm this] contribution from Bilderberg.org</ref><ref>[http://mises.org/daily/4631 Is Our Money Based On Debt?], Robert Murphy</ref><ref name="speech">See the [http://www.prosperityuk.com/prosperity/articles/earl.html speech] of the Earl of Caithness in the House of Lords on 5 March 1997</ref><ref>See this speech given by [[Zhou Xiaochuan]], [http://www.bis.org/review/r090402c.pdf Reform the monetary system], 23 March 2009 (BIS), and this article, [http://www.nakedcapitalism.com/2009/02/steve-keen-roving-cavaliers-of-credit.html ''Roving Cavaliers of Credit''] by Steve Keen (with commentary by Yves Smith)</ref><ref>[http://globaleconomicanalysis.blogspot.com/2010/09/myths-about-whats-economically.html Myths], MISH</ref><ref>[http://globaleconomicanalysis.blogspot.com/2010/07/are-we-trending-towards-deflation-or-in.html Deflation], MISH</ref>

Aside from the criticisms relating to the dislocating effects of the Ponzi-like dynamics inherent in the practice of fractional-reserve banking, the primary ''economic'' criticisms relate to its alleged destabilizing effects through the [[Austrian Business Cycle Theory]].

The reason that so many negative effects flow from fractional-reserve banking is that it necessarily distorts and confuses property rights over money.<ref>[http://www.marketoracle.co.uk/Article25212.html The Faults of FRB], Thorsten Polleit</ref>

By employing its excess reserves for the granting of credit, the bank transfers temporary ownership of those monetary reserves to borrowers, while the depositors (supposedly entitled to instant redemption) are supposed to retain their rights to claim redemption ''over the same funds'' - funds that no longer are in the custody of the bank and now appear in another bank's account.

It is physically and practically impossible that a depositor and borrower are entitled to exclusive control over the same physical cash resources. Two individuals cannot be the exclusive owner of one and the same thing at the same time. Accordingly, any bank pretending otherwise - in assuming demand liabilities in excess of actual reserves - must be considered as acting fraudulently and should be considered to be engaged in a straightforward act of [[embezzlement]]. Its contractual obligations cannot be properly fulfilled and it is technically trading whilst illiquid and therefore (arguably) trading whilst insolvent as it cannot pay all its debt as and when they fall due (the due date for payment of demand deposits is always now). From the outset, the bank must be regarded as inherently bankrupt - as revealed by the fact that no bank can ever withstand a sustained bank run.<ref name="Hoppe_FRB">Hans-Hermann Hoppe. [http://mises.org/journals/rae/pdf/RAE7_2_3.pdf "How is Fiat Money Possible? - or, The Devolution of Money and Credit"] (pdf), The Review of Austrian Economics Vol.7, No. 2 (1994). Referenced 2010-04-29.</ref>

According to [[Rothbard]], fractional reserve banking should be considered to be embezzlement, but it is legal now. The bank is technically insolvent, because it cannot pay its debts as and when they fall due - the deposits being due instantaneously at any time. However, unless the customers (depositors) demand too much money at once – or too many loans fail – it can continue running, without the customers ever noticing that their money was gone. If the bank's customers lose confidence in the chances of the bank's repayment, they can decide, en masse, to cash the deposits in. This loss of confidence, if it spreads from a few to a large number of bank depositors is called a [[bank run]]. Unless the central bank intervenes or other banks come to its rescue, a bank run is always fatal, because, by the very nature of FRB, the bank cannot honor all of its contracts.<ref name="Rothbard_FRB">Murray N. Rothbard. [http://mises.org/books/fed.pdf "The Case Against the Fed"] (pdf), referenced 2010-04-29.</ref>

===Banking cartels===
If a lone bank engages in FRB, it can be ruined by a bank run, or people, who are not its customers, or other banks, demanding redemption of their receipts. A group of banks can agree to accept each other's receipts and not call for their redemption. This would limit the weaknesses of FRB, but in turn introduce the problems of [[cartel]]s. The banks would need to expand in proportion, otherwise some will enjoy greater profit, while the rest will pay for it. Regional and seasonal differences may also come into play. The difficulty of coordination rises with the number of banks in a cartel.

However, cooperation in a cartel is much easier if the members are forced to it by law. A [[Central bank]] can enable all the banks to expand together so that one set of banks doesn't lose reserves to another and is forced to contract sharply or go under. A central bank is the lender of the last resort, bailing out the banks if necessary – this also increases the trust of the public in the system.<ref name="Rothbard_FRB" />

==The Case For FRB==
However, not all hold to such a stringent view of legality. In particular, the [[Free banking]] school asserts that the [[Principle of Adverse Clearing]], a market signal by which banks can settle upon an equilibrium interest rate with respect to consumer demand for banknotes (and analogous to [[David Hume]]'s [[Price-specie flow mechanism]]), is sufficient to prevent a fractional reserve system from becoming inflationary or unstable.<ref name="Selgin_FRB">George Selgin. [http://www.independent.org/pdf/tir/tir_14_04_01_selgin.pdf "Central Banks as Sources of Financial Instability"] (pdf), The Independent Review Vol.14, No. 4 (2010). Referenced 2010-11-19.</ref> Bank runs under a fractional reserve system can also be prevented by contract features such as an [[option clause]]. Indeed, so long as the banks' contracts make clear such activities beforehand, a legal or natural rights case against FRB cannot be made.

The amount of loans a single bank may make under a free, fractional reserve system is limited by the size of its clientele, by the confidence of the public in its solvency, and by the demand of the public for banknotes (as opposed to specie). An increase in any of these allows the bank to hold lower reserves. Conversely, smaller banks, riskier banks, and banks in a climate that demands specie (these factors may be interrelated) must hold a higher fraction in reserves in order to attract clientele. In this way, fractional reserve banking - far from theft or embezzlement - is a beneficial market signal and the result of voluntary human action that in itself poses little risk of systemic instability.{{Fact}}

==Legal aspects==
[[Roman law]] recognized that bankers were often tempted to use the deposits for themselves. To penalize these actions, they should be not only charged with theft, but to pay interest "so that, in fear of these penalties, men will cease to make evil, foolish and perverse use of deposits".<ref name="De_Soto_reserves" />

In early medieval Europe, the bankers preserved their deposits fully at first, but later began to use them for their own purposes, creating deposits and granting credits out of nowhere. Since the canonical law banned the charging of [[interest]] on loans, borrowers would instead pay "penalties" for "delays" in payment and in effect pay interest on a disguised loan, and justified any misappropriations on this basis. This practice was defended by some scholars, while others wanted to expose all hidden loans and equated all deposit contracts for loans. As a result, the distinction between them was obscured. Experts failed to clear up the resulting legal chaos until the end of the nineteenth century.

The authorities failed to enforce sound banking practices, and often granted banks a government license to operate with a fractional reserve, while taking advantage of easy loans to finance governments and public officials. Some rulers created government banks to reap the profits. But banks were still required to guarantee deposits.<ref name="De_Soto_Medieval">Jesús Huerta de Soto. [http://mises.org/books/desoto.pdf "Money, Bank Credit, and Economic Cycles"]. 3. Bankers in the Late Middle Ages, p. 59-69, referenced 2009-11-05.</ref>

As late as twentieth century, court decisions in Europe have upheld the demand for a 100-percent reserve requirement. In 1927, the Court of Paris convicted a banker for the crime of misappropriation for having used the funds deposited with him by a client, confirmed in 1934. After the failure of the Bank of Barcelona the Spanish Supreme Court also pronounced, that "the depositary does not acquire the right to use the deposit for his own purposes".<ref name="De_Soto_reserves" />

Fractional reserve banks never informed their depositors that some or all of their deposits would actually be loaned out and so could not possibly be ready for redemption at any time. (Even if the bank were to pay [[interest]] on deposit accounts, and hence it should have been clear that the bank must loan out deposits, this does not imply that any of the depositors actually understand this fact. Indeed, it is safe to say that few if any do, even among those who are not economic illiterates.) Nor did fractional reserve banks inform their borrowers that some or all of the credit granted to them had been created out of thin air and was subject to being recalled at any time.<ref name="Hoppe_FRB" />

===Legalization===
The landmark decisions came in Britain in the first half of the nineteenth century. In the first important case, Carr v. Carr, in 1811, the British judge, Sir William Grant, ruled that since the money paid into a bank deposit had been paid generally, and not earmarked in a sealed bag (i.e., as a "specific deposit") that the transaction had become a loan rather than a bailment. Five years later, in the key follow-up case of Devaynes v. Noble, one of the counsel argued correctly that "a banker is rather a bailee of his customer's fund than his debtor,. . . because the money in . . . [his] hands is rather a deposit than a [[debt]], and may therefore be instantly demanded and taken up." But the same Judge Grant again insisted that "money paid into a banker's becomes immediately a part of his general assets; and he is merely a debtor for the amount." In the final culminating case, Foley v. Hill and Others, decided by the House of Lords in 1848, Lord Cottenham, repeating the reasoning of the previous cases:

<blockquote>''The money placed in the custody of a banker is, to all intents and purposes, the money of the banker, to do with as he pleases; he is guilty of no breach of trust in employing it; he is not answerable to the principal if he puts it into jeopardy, if he engages in a hazardous speculation; he is not bound to keep it or deal with it as the property of his principal; but he is, of course, answerable for the amount, because he has contracted.''</blockquote>

These decisions were taken over by the American courts and so was FRB legalized. However, an interesting development occurred in grain warehouse law, which has developed in precisely the opposite direction, despite the conditions of depositing [[Fungibility|fungible]] goods were exactly the same, and grain was a general deposit and not an earmarked bundle.

In the history of the U. S. grain market, grain elevators several times fell prey to this temptation, spurred by a lack of clarity in bailment law. Grain elevators issued fake warehouse receipts in grain during the 1860s, lent them to speculators in the Chicago wheat market, and caused dislocations in wheat prices and bankruptcies in the wheat market. Only a tightening of bailment law, ensuring that any issue of fake warehouse receipts is treated as fraudulent and illegal, finally put an end to this clearly immoral practice. Fractional-reserve grain warehousing, that is, the issuing of warehouse receipts for non-existent goods, was clearly seen as a fraud.<ref name="Rothbard_FRB" />

{{See also|History of money and banking}}

==Securitization==
Known since 18th century, securitization as it is known today was created in 1970, when the Government National Mortgage Association ([[Government National Mortgage Association|Ginnie Mae]]) issued a mortgage-backed security ([[Mortgage-backed security|MBS]]) in the form of a pass through. Securitization has had an exponential growth since.

Economic actors can obtain rights to future payments of money - for instance, a car dealer that sells his cars on credit for five years in exchange of his cars. Such credits are relatively illiquid because their characteristics tend to be sector and client specific. Their owners may prefer to exchange them for an amount of money that is available now. Each of these claims can be passed to an economic actor that has the opposite preferences. Or, relatively similar claims, possibly coming from different owners, could be grouped together within a single holding entity that could then create standardized claims to be sold to investors on the financial markets. This process of putting together relatively illiquid assets and using them is called '''securitization''' - "... the process of pooling and repacking loans into securities that are then sold to investors."

Securitization allows FRBs to withdraw from the market the credit they have created and lent out. It reduces the money supply by the amount of liquid assets used to purchase the asset-backed securities. Therefore, it hides the increase in the money supply, i.e., [[inflation]]. It makes the economic environment appear less inflationary than it should be, given individuals' growing indebtedness to banks. Securitization portrays a bank-credit driven boom as noninflationary, savings driven growth. Also, securitization insulates lending activity of banks from the central bank's monetary policy. It contributes to the widespread illusion that more factors of production are available than in reality, and so becomes a factor in the generation of the boom-bust cycle.<ref name="Gertchev_Securitization">Nikolay Gertchev . [http://mises.org/daily/3820 "Securitization and Fractional-Reserve Banking"], Mises Daily,posted on Thursday, November 12, 2009, referenced 2009-11-14.</ref>

==References==
{{Reflist}}

==External links==
* [[Wikipedia:Fractional-reserve banking|Fractional-reserve banking]] on Wikipedia
* [http://mises.org/journals/jls/18_3/18_3_3.pdf "Legal Tender Laws and Fractional-Reserve Banking"](pdf) by Jörg Guido Hülsmann
* [http://mises.org/journals/scholar/shostak2.pdf Fractional Reserve banking and boom-bust cycles] by Frank Shostak
* [http://mises.org/daily/4499 The Fractional-Reserve Banking Question] by Robert P. Murphy, June 2010
* [http://mises.org/daily/4560 The Form of Saving Matters] by Robert P. Murphy, August 2010

[[Category:Banking]]
[[Category:Money]]

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Austrian Economics Wiki:WikiProject Economic History

2010-11-22T04:00:36Z

Catalan: /* Members */ adding myself

Welcome to the '''Economic History''' WikiProject! The aim of this project is to create a solid overview of the world's history, with a special focus on economic conditions and development of economic thinking.


==Goals==
* The ultimate aspiration of this project is to make MisesWiki an authoritative guide to economic history.
* The goal of this project is to provide a forum for discussion of economic history, and to create and improve articles related to the field of economic history.

==Editing guidelines==
* Use the most reliable and authoritative resources available.
* Link to Wikipedia articles, when they offer a good alternative overview of the topic, but do not copy content from it.
* Various theories and viewpoints should be represented, with a focus on the [[Austrian School|Austrian]] tradition of historical research and freedom.

==Vital pages==
The following pages are crucial to this project, please consider expansions and improvements:
* [[History of money and banking]]
* [[History of money and banking in the US]]
* [[Inflations]]
* [[Great Depression]]
* [[Great Recession]]

==Open tasks==
* Improve the article '''[[Inflation in the Weimar Republic]]''' so that it can be featured on the main page.
* Create a fancy graphic for the project, and a template the members can add to their pages.
* Find an effective way to agree on the [[Special:WantedPages|most wanted]] articles on economic history - for now, the [[MisesWiki talk:WikiProject Economic History|Talk page]] should serve for this purpose.

==Members==
'''If you would like to be a member of the project, sign your name below, after the last signee, with <nowiki>"# ~~~~"</nowiki> (four ''tildes'').

# [[User:Pestergaines|Pestergaines]] 05:44, 20 November 2010 (CST)
# '''[[User:Catalan|JonCatalán]]'''<sup>[[User talk:Catalan|(Talk)]]</sup> 22:00, 21 November 2010 (CST)

[[Category:WikiProject History]]

User:Catalan

2010-11-14T06:08:14Z

Catalan:

<small><center>'''User Navigation:''' [[User:Catalan/Library|Library]]|[[User:Catalan/Sandbox|Sandbox]]</center></small>

Greetings,

My name is Jonathan Finegold (my complete name is "Jonathan Michael Finegold Catalán", which explains my username). I am an experienced Wikipedia editor, registered there since mid-December 2005. You can see my major Wikipedia contributions on my user page: [http://en.wikipedia.org/wiki/User:Catalan User:Catalan]. Regarding economics, I tend to focus on theory and history.

'''Core articles:''' (That I intend on expanding)
# [[Austrian economics]]
# [[Human Action]]
# [[Ludwig von Mises]]
# [[Austrian business cycle theory]]
# [[Capital theory]]
# [[Natural rate of interest]]

User:Catalan

2010-11-14T06:07:50Z

Catalan: linking in lieu of usernav bar

<small><center>''User Navigation:''' [[User:Catalan/Library|Library]]|[[User:Catalan/Sandbox|Sandbox]]</center></small>

Greetings,

My name is Jonathan Finegold (my complete name is "Jonathan Michael Finegold Catalán", which explains my username). I am an experienced Wikipedia editor, registered there since mid-December 2005. You can see my major Wikipedia contributions on my user page: [http://en.wikipedia.org/wiki/User:Catalan User:Catalan]. Regarding economics, I tend to focus on theory and history.

'''Core articles:''' (That I intend on expanding)
# [[Austrian economics]]
# [[Human Action]]
# [[Ludwig von Mises]]
# [[Austrian business cycle theory]]
# [[Capital theory]]
# [[Natural rate of interest]]

User:Catalan/ImageLink

2010-11-14T06:02:56Z

Catalan: creating

<div style="position:relative; width:{{{size}}}; height:{{{size}}}; overflow:hidden; margin:0 auto"><div style="position:absolute; top:0px; left:0px; font-size:100px; overflow:hidden; line-height:100px; z-index:3;">[[{{{link}}}|<span>    </span>]]</div><div style="position:absolute; top:0px; left:0px; z-index:2;">[[image:{{{image}}}|{{{size}}}]]</div>

User:Catalan/Usernav

2010-11-14T06:02:21Z

Catalan: creating

{| cellpadding="4" cellspacing="4" style="width:100%; margin:auto; background: transparent; border: none; -moz-border-radius:1px;"
|
{| align="center" style="background:transparent; border:0px; -moz-border-radius-topleft:7px; -moz-border-radius-topright:7px; -moz-border-radius-bottomright:7px; -moz-border-radius-bottomleft:7px; text-align:center;"
|{{User:Catalan/ImageLink|link=User:Catalan|image=|size=40px}}
|-
| width="80" | <small>[[User:Catalan|<font color="black">User Page</font>]]</small>
|}

Austrian Economics Wiki:Featured articles

2010-11-14T04:20:42Z

Catalan: categorizing

Featured articles are considered Mises Wiki's best work, as determined by Mises Wiki's editors. To be featured and listed an article must first be subjected to [[MisesWiki:Featured article candidate|featured article candidacy]], where it is extensively peer reviewed. Articles are reviewed against the [[MisesWiki:Featured article criteria|featured article criteria]], including: accuracy, verifiability of any and all references, and completeness. Featured articles are indicated by a miniature Mises family crest ( [[Image:Mises-shield-1.png|15px|This crest symbolizes the featured content on Mises Wiki.]] ), located on the top right corner of the article.

==Featured article criteria==
{{MisesWiki:Featured article criteria}}

==Listing==

[[Category:Featured articles]]

Austrian Economics Wiki:Featured article criteria

2010-11-14T04:20:26Z

Catalan: starting page

A [[MisesWiki:Featured articles|featured article]] represents Mises Wiki's best work. In order to become featured, an article must be subjected to a process of peer review as a [[MisesWiki:Featured article candidate|featured article candidate]] against the following standards.

<ol>
<li>It is—</li>
<ul>
<li>(a) '''well-written:''' its prose is of a professional standard;</li>
<li>(b) '''complete:''' it neglects no major facts or details and places the subject in context;</li>
<li>(c) '''well-researched and accurate''': it is a thorough and representative survey of the relevant literature. Claims are verifiable against high-quality reliable sources and are supported by inline citations where appropriate;</li>
<li>(d) '''stable:''' it is not subject to ongoing edit wars and its content does not change significantly from day to day, except in response to the featured article process.</li>
</ul>
<li>It follows the following style guidelines—</li>
<ul>
<li>(a) '''a lead''': a concise lead section that summarizes the topic and prepares the reader for the detail in the subsequent sections;</li>
<li>(b) '''appropriate structure''': a system of hierarchical section headings and a substantial but not overwhelming table of contents; and</li>
<li>(c) '''consistent citations''': where required by criterion 1c, consistently formatted inline citations using either footnotes or Harvard referencing.</li>
</ul>
<li>'''Media.''' It contains images where appropriate, with succinct captions, acceptable copyright status. </li>
<li>'''Length.''' It stays focused on the main topic without going into unnecessary detail.</li>
</ol>

[[Category:Featured articles]]

Austrian Economics Wiki:Featured articles

2010-11-14T04:13:33Z

Catalan: adding space between parentheses

Austrian Economics Wiki:Featured articles

2010-11-14T04:12:45Z

Catalan: starting page

Featured articles are considered Mises Wiki's best work, as determined by Mises Wiki's editors. To be featured and listed an article must first be subjected to [[MisesWiki:Featured article candidate|featured article candidacy]], where it is extensively peer reviewed. Articles are reviewed against the [[MisesWiki:Featured article criteria|featured article criteria]], including: accuracy, verifiability of any and all references, and completeness. Featured articles are indicated by a miniature Mises family crest ([[Image:Mises-shield-1.png|15px|This crest symbolizes the featured content on Mises Wiki.]]), located on the top right corner of the article.

==Featured article criteria==
{{MisesWiki:Featured article criteria}}

==Listing==

File:Mises-shield-1.png

2010-11-14T04:09:29Z

Catalan: Ludwig von Mises's family crest. Source: Ludwig von Mises Institute.

== Summary ==
Ludwig von Mises's family crest. Source: Ludwig von Mises Institute.
== Licensing ==
{{CC-BY}}

Talk:Main Page

2010-11-09T15:53:35Z

Catalan: /* New design */ cmt.

==Ideas for Main Page organization==
The Wikipedia [http://en.wikipedia.org/wiki/Main_Page main page] incorporates several features:

# Did You Know?: spotlights new articles or substantial revisions and incentivizes users to do substantial new work rather than just little tweaks here and there
# Today's Featured Article: showcases articles that have reached the highest quality level, according to the FA criteria developed by folks working on [http://en.wikipedia.org/wiki/Wikipedia:Featured_articles that project]
# In The News: provides short "breaking news" blurbs which link to relevant content
# On This Day: lists historical facts from this day in history and links to relevant content

We could develop a feature like #1 pretty easily, especially since everything is new right now.

Number 2 is something that I would like for us to have once we have adequate content to support it, but I don't think we are quite there yet.

On Wikipedia, the "In The News" feature is easy to run because almost any news subject is likely to be linkable to multiple pre-existing articles. We might create something like #3 as a way to draw attention to Austrians who are in the news or who have provided commentary on events covered in the news, and our equivalent of the "In The News" feature could be linked from "Current Events" in the nav box on page left.

I think #4 is out for right now, too, although we could eventually note birthdays of famous Austrians and other relevant historical tidbits once we develop a little more content.

The "Community Portal" link on the left could lead to a page much like [http://en.wikipedia.org/wiki/Wikipedia:Community_portal the one on Wikipedia], with a running "to-do" list of articles that need to be created or substantially revised, links to projects (as they develop), and any notices about community-wide news.

Thoughts?
[[User:DickClarkMises|DickClarkMises]] 09:48, 6 November 2010 (CDT)

----

These all seem great to me but of course I have my usual concern about daily updates to the front page now. I find myself suddenly anxious to develop some intellectual eye candy up front along with links to how to write for wikipedia, if only because something tells me that we are the verge of a more public discovery. It would be good to have the curb appeal right up front.

I might suggest that we leave a featured piece up on [[Austrian economics]], right up there with some colored background or something.

--[[User:Jatucker|Jatucker]] 12:26, 6 November 2010 (CDT)

:: I have the next couple of days off, so I'll try to see what I can do to get [[Austrian economics]] up to snuff. By the way, should it be "Austrian economics" or "Austrian school"? Regarding this main page, I don't think "on this day" would be too difficult to set up early. We'd have to gather up relevant birthdays and events (such as the first Mont Pelerin Society meeting, that meeting in 1974 setting the beginning of the Austrian revival, et cetera). It will take some time, though. Maybe a more permanent template, for now, would do the trick—"during this week". We could do a featured picture widget, but instead of featured pictures maybe just rotating images of different Austrian economists and other relative individuals. At first, some of the stuff will prob. have to be "semi-permanent", in the sense that most stuff probably won't be updated every day. '''[[User:Catalan|JonCatalán]]'''<sup>[[User talk:Catalan|(Talk)]]</sup> 21:01, 7 November 2010 (CST)

:::Younger, less developed Wikimedia sites (such as [http://en.wikisource.org Wikisource]), have different items on the main page. A featured work of the month, a list of new articles (that anyone can add to), and current collaborations, for example. It may make more sense to pursue some of these less-intensive solutions instead of/in addition to the ones Wikipedia uses.
:::To start we can at least do "new texts" (probably instead of "Did You Know?") and once we've developed a particular article more fully, make that the month's featured article (maybe for December?). I like the idea of having an "During this week" box that starts off as weekly and eventually can be changed to "On this day". --[[User:Forgottenman|Forgottenman]] 08:10, 8 November 2010 (CST)

==New design==
Work on a new Main Page design is ongoing at [[Main Page/new]]. For this initial design I kept many of Wikipedia's design features (but with a different header), and developed similar content. Feel free to make changes or suggestions. --[[User:Forgottenman|Forgottenman]] ([[User talk:Forgottenman|talk]]) 14:55, 8 November 2010 (CST)
: I implemented this. For whatever reason, the favicon is gone --[[User:Jatucker|Jatucker]] 09:06, 9 November 2010 (CST)

: For "on this week", should we link to years and such? I was going to suggest linking with wp:en, but then that wouldn't make sense because you'd direct the user off the site without that page actually being relevant. It makes sense to wikilink to the day, because we could fill in the days with important events and such (that can be used to update "on this week"), but what about the years? '''[[User:Catalan|JonCatalán]]'''<sup>[[User talk:Catalan|(Talk)]]</sup> 09:53, 9 November 2010 (CST)

User:Catalan/Sandbox

2010-11-08T23:04:54Z

Catalan: skeleton

(This is a sandbox, used to introduce edits outside of the Wikispace before incorporating them into the article itself. Currently, this sandbox is for [[Austrian School]].)

==History==

===Origins===

===Later development===

===Austrian revival===

==Economics==

===Methodology===

===Monetary theory===

===Interest theory===

===Capital theory===

==Philosophy==

Austrian Economics

2010-11-08T22:24:25Z

Catalan: moved Austrian Economics to Austrian School: I figured that the school now includes much more than just economics, including philosophy, economic history, et cetera.

#REDIRECT [[Austrian School]]

Austrian School

2010-11-08T22:24:25Z

Catalan: moved Austrian Economics to Austrian School: I figured that the school now includes much more than just economics, including philosophy, economic history, et cetera.

The '''Austrian School of Economics''' derives its name from its Austrian founders and early supporters, including [[Carl Menger]], [[Eugen von Böhm-Bawerk]] and [[Ludwig von Mises]]. Other significant economists include [[Henry Hazlitt]], [[Murray Rothbard]] and Nobel Laureate [[Friedrich Hayek]]. Current research is represented by, among many others, scholars from the [[Mises Institute|Ludwig von Mises Institute]].

This school emphasizes the spontaneous organizing power of the price mechanism and holds that the complexity of subjective human choices makes mathematical modeling of the evolving market extremely difficult (or impossible). Its proponents tend to advocate a laissez faire approach to the economy and the enforcement of voluntary contractual agreements between economic agents, but otherwise the smallest imposition of coercive force (especially government-imposed) on commercial transactions.

==History==
While the Austrian School of Economics has connections as far as 15th century, it began with notable 19th century economists of Austrian origin.

===Pre-Austrian Economists===
With noted contributions of earlier thinkers, like [[Nicole Oresme]], the Austrian school traces its roots to the followers of St. Thomas Aquinas, writing and teaching at the [[School of Salamanca|University of Salamanca]] in Spain.

These Late Scholastics established the first modern economic theories and argued, in current terms, for free [[trade]] and property rights. Over the course of several generations, they discovered and explained the laws of [[supply]] and [[demand]], the cause of [[inflation]], the operation of foreign exchange rates, and the subjective nature of economic [[value]]. They were advocates of property rights and the freedom to contract and trade. "Austrians share the scholastic belief that there is no such thing as an economic science dealing with autonomous variables. Economic problems are aspects of larger social phenomena; and it is most expedient to deal with them as such, rather than to analyze them in some twisted separation."<ref name="Hulsmann_scholastics">Jörg Guido Hülsmann. [http://www.mises.org/books/moneyproduction.pdf "Ethics of Money Production"], online version, Introduction p. 12, referenced 2009-05-10.</ref>

The first general treatise on economics, [http://socserv2.socsci.mcmaster.ca/~econ/ugcm/3ll3/cantillon/index.html Essay on the Nature of Commerce], was written in 1730 by [[Richard Cantillon]], a man schooled in the scholastic tradition. Born in Ireland, he emigrated to France. He saw economics as an independent area of investigation, and explained the formation of [[price]]s using the "thought experiment." He understood the market as an entrepreneurial process, and held to an Austrian theory of money creation: that it enters the economy in a step-by-step fashion, disrupting prices along the way.

Cantillon was followed by [[Anne Robert Jacques Turgot]], the pro-market French aristocrat and finance minister under the ''ancien regime'', one of the [[Physiocrats]]. His economic writings were few but profound. His paper "Value and Money" spelled out the origins of money, and the nature of economic choice: that it reflects the subjective rankings of an individual's preferences. Turgot solved the famous [[Wikipedia:Paradox of value|diamond-water paradox]] that baffled later classical economists, articulated the law of diminishing returns, and criticized usury laws (a sticking point with the Late Scholastics). He favored a classical liberal approach to economic policy, recommending a repeal of all special privileges granted to government-connected industries.

Turgot was the intellectual father of a long line of great French economists of the eighteenth and nineteenth century, most prominently [[Jean-Baptiste Say]] and [[Frederic Bastiat|Claude-Frederic Bastiat]]. Say was the first economist to think deeply about economic method. He realized that economics is not about the amassing of data, but rather about the verbal elucidation of universal facts (for example, wants are unlimited, means are scarce) and their logical implications.

Say discovered the productivity theory of resource pricing, the role of [[capital]] in the division of labor, and "[[Wikipedia:Say's Law|Say's Law]]": there can never be sustained "overproduction" or "underconsumption" on the free market if prices are allowed to adjust. He was a defender of laissez-faire and the industrial revolution, as was Bastiat. As a free-market journalist, Bastiat also argued that nonmaterial services are subject to the same economic laws as material [[good]]s. In one of his many economic allegories, Bastiat spelled out the "[[Parable of the broken window|broken-window fallacy]]" later popularized by [[Henry Hazlitt]].

Despite the theoretical sophistication of this developing pre-Austrian tradition, the [[Wikipedia:Classical economics|British school]] of the late eighteenth and early nineteenth centuries won the day, mostly for political reasons. This British tradition (based on the objective-cost and labor-productivity theory of value) ultimately led to the rise of the Marxist doctrine of capitalist exploitation.

===The First Austrians===
The dominant British tradition received its first serious challenge in many years when [[Carl Menger]]'s [[Wikipedia:Principles of Economics|Principles of Economics]] ([http://mises.org/etexts/menger/principles.asp text]) was published in 1871. Menger, the founder of the Austrian School proper, resurrected the Scholastic-French approach to economics, and put it on firmer ground.

Together with the contemporaneous writings of [[Wikipedia:Leon Walras|Leon Walras]] and [[Wikipedia:William Stanley Jevons|Stanley Jevons]], Menger spelled out the subjective basis of [[Value|economic value]], and fully explained, for the first time, the theory of [[Utility|marginal utility]] (the greater the number of units of a [[good]] that an individual possesses, the less he will value any given unit). In addition, Menger showed how money originates in a free market when the most marketable [[commodity]] is desired, not for consumption, but for use in trading for other goods.

Menger's book was a pillar of the "[[Wikipedia:Marginalist revolution#The_Marginal_Revolution|marginalist revolution"]] in the history of economic science. When Mises said it "made an economist" out of him, he was not only referring to Menger's theory of money and prices, but also his approach to the discipline itself. Like his predecessors in the tradition, Menger was a classical liberal and methodological individualist, viewing economics as the science of individual choice. His Investigations, which came out twelve years later, battled the [[Wikipedia:Historical school of economics|German Historical School]], which rejected theory and saw economics as the accumulation of data in service of the state. They took great exception to his defense of "theory" and gave the work of Menger and his followers the derogatory name "'''Austrian school'''" because of their faculty positions at the University of Vienna. The term stuck.<ref name="School">[http://mises.org/about/3467#Austrian_Economics "FAQ: What is Austrian Economics"], ''[[Mises Institute]]'', referenced 2009-04-27.</ref>

As professor of economics at the University of Vienna, and then tutor to the young but ill-fated [[Wikipedia:Rudolf, Crown Prince of Austria|Crown Prince Rudol]]f of the House of Habsburg, Menger restored economics as the science of human action based on deductive logic, and prepared the way for later theorists to counter the influence of socialist thought. Indeed, his student [[Wikipedia:Friederich von Wieser|Friederich von Wieser]] strongly influenced Friedrich von Hayek's later writings. Menger's work remains an excellent introduction to the economic way of thinking.

Menger's admirer and follower at the University of Innsbruck, [[Eugen von Böhm-Bawerk]], took Menger's exposition, reformulated it, and applied it to a host of new problems involving [[value]], [[price]], [[capital]], and interest. His [[Wikipedia:Capital and Interest|History and Critique of Interest Theories]] ([http://mises.org/books/capitalandinterest.pdf pdf]), appearing in 1884, is a sweeping account of fallacies in the history of thought and a firm defense of the idea that the interest rate is not an artificial construct but an inherent part of the market. It reflects the universal fact of "[[time preference]]," the tendency of people to prefer satisfaction of wants sooner rather than later (a theory later expanded and defended by [[Wikipedia:Frank Fetter|Frank Fetter]]<ref name="Fetter">Jeffrey Herbener. [http://mises.org/about/3231 "Frank A. Fetter (1863-1949): A Forgotten Giant"], ''[[Mises Institute]]'', referenced 2009-04-28.</ref>).

Böhm-Bawerk's ''Positive Theory of Capital'' ([http://mises.org/books/positivetheory.pdf pdf]) demonstrated that the normal rate of business profit is the interest rate. Capitalists [[Saving|save]] money, pay laborers, and wait until the final product is sold to receive profit. In addition, he demonstrated that [[capital]] is not homogeneous but an intricate and diverse structure that has a time dimension. A growing economy is not just a consequence of increased capital investment, but also of longer and longer processes of production.

Böhm-Bawerk engaged in a prolonged battle with the [[Wikipedia:Marxian Economics|Marxists]] over the exploitation theory of capital, and refuted the socialist doctrine of capital and wages long before the communists came to power in Russia. Böhm-Bawerk also conducted a seminar that would later become the model for Mises's own Vienna seminar.

Böhm-Bawerk favored policies that deferred to the ever-present reality of economic law. He regarded interventionism as an attack on market economic forces that cannot succeed in the long run. In the last years of the Habsburg monarchy, he three times served as finance minister, fighting for balanced budgets, sound money and the [[gold standard]], free trade, and the repeal of export subsidies and other monopoly privileges.

===Mises and Hayek===
It was Böhm-Bawerk's research and writing that solidified the status of the Austrian School as a unified way of looking at economic problems, and set the stage for the School to make huge inroads in the English-speaking world. But one area where Böhm-Bawerk had not elaborated on the analysis of Menger was [[money]], the institutional intersection of the "micro" and "macro" approach. The young [[Ludwig von Mises]]<ref name="Mises">Murray N. Rothbard. [http://mises.org/about/3248 "Ludwig von Mises (1881-1973)"], ''[[Mises Institute]]'', referenced 2009-04-26.</ref>, economic advisor to the Austrian Chamber of Commerce, took on the challenge.

The result of Mises's research was [[Wikipedia:The Theory of Money and Credit|The Theory of Money and Credit]] ([http://mises.org/books/Theory_Money_Credit/Contents.aspx text]), published in 1912. He spelled out how the theory of [[Utility|marginal utility]] applies to [[money]], and laid out his "regression theorem," showing that money not only originates in the market, but must always do so. Drawing on the [[British Currency School|British Currency School]], [[Wikipedia:Knut Wicksell|Knut Wicksell]]'s theory of [[interest rate]]s, and Böhm-Bawerk's theory of the structure of production, Mises presented the broad outline of the [[Austrian Business Cycle Theory|Austrian theory of the business cycle]]. A year later, Mises was appointed to the faculty of the University of Vienna, and Böhm-Bawerk's seminar spent a full two semesters debating Mises's book.

Mises's career was interrupted for four years by [[Wikipedia:World War I|World War I]]. He spent three of those years as an artillery officer, and one as a staff officer in economic intelligence. 1919, at war's end, he published ''Nation, State, and Economy'' ([http://mises.org/nsande.asp text]), arguing on behalf of the economic and cultural freedoms of minorities in the now-shattered empire, and spelling out a theory of the economics of war. Meanwhile, Mises's monetary theory received attention in the U.S. through the work of [[Wikipedia:Benjamin Anderson|Benjamin M. Anderson, Jr.]]<ref name="Anderson">Mark Thornton. [http://mises.org/about/3226 "Benjamin Anderson (1886-1949)"], ''[[Mises Institute]]'', referenced 2009-04-26.</ref>, an economist at Chase National Bank. (Mises's book was panned by [[Wikipedia:John Maynard Keynes|John Maynard Keynes]], who later admitted he could not read German.{{Fact|reason=It would be cool to quote this somewhere.}})

In the political chaos after the war, the main theoretician of the now-socialist Austrian government was Marxist [[Wikipedia:Otto Bauer|Otto Bauer]]. Knowing Bauer from the Böhm-Bawerk seminar, Mises explained economics to him night after night, eventually convincing him to back away from Bolshevik-style policies.{{fact|reason=It would be great to have a resource on this.}} The Austrian socialists never forgave Mises for this, waging war against him in academic politics and successfully preventing him from getting a paid professorship at the university.

Undeterred, Mises turned to the problem of socialism itself, writing a blockbuster essay in 1921, which he turned into the book [[Wikipedia:Socialism (book)|Socialism]] ([http://www.mises.org/books/socialism/contents.aspx text]) over the next two years. Socialism permits no private property or exchange in [[Capital|capital goods]], and thus no way for resources to find their most highly valued use. Socialism, Mises predicted, would result in utter chaos and the end of civilization.

Mises challenged the socialists to explain, in economic terms, precisely how their system would work, a task which the socialists had heretofore avoided. The debate between the Austrians and the socialists continued for the next decade and beyond, and, until the collapse of world socialism in 1989, academics had long thought that the debate was resolved in favor of the socialists.

Meanwhile, Mises's arguments on behalf of the free market attracted a group of converts from the socialist cause, including [[Friedrich Hayek|Hayek]], [[Wikipedia:Wilhelm Roepke|Wilhelm Roepke]]<ref name="Roepke">Shawn Ritenour. [http://mises.org/about/3241 "Wilhelm Röpke (1899-1966): Humane Economist"], ''[[Mises Institute]]'', referenced 2009-04-27.</ref> , and [[Wikipedia:Lionel Robbins|Lionel Robbins]]. Mises began holding a private seminar in his offices at the Chamber of Commerce that was attended by [[Wikipedia:Fritz Machlup|Fritz Machlup]]<ref name="Machlup">Mark Thornton. [http://mises.org/about/3237 "Biography of Fritz Machlup (1902-1983)"], ''[[Mises Institute]]'', referenced 2009-04-27.</ref>, [[Wikipedia:Oskar Morgenstern|Oskar Morgenstern]], [[Wikipedia:Gottfried von Haberler|Gottfried von Haberler]]<ref name="Haberler">[http://mises.org/journals/aen/aen20_1_1.asp "Between Mises and Keynes An Interview with Gottfried von Haberler (1900-1995)"], ''The Austrian Economics Newsletter'' Spring 2000 Volume 20, Number 1, referenced 2009-04-27.</ref>, [[Wikipedia:Alfred Schutz|Alfred Schutz]]<ref name="Schutz">Peter Kurrild-Klitgaard. [http://mises.org/journals/qjae/pdf/qjae6_2_2.pdf "The Viennese Connection: Alfred Schutz and the Austrian School"](pdf), ''The Quarterly Journal Of Austrian Economics'' Vol.6, no.2, referenced 2009-04-27.</ref>, Richard von Strigl<ref name="Strigl">Jörg Guido Hülsmann. [http://mises.org/about/3243 "Richard von Strigl (1891-1942)"], ''[[Mises Institute]]'', referenced 2009-04-27.</ref>, [[Wikipedia:Eric Voegelin|Eric Voegelin]], [[Wikipedia:Paul Rosenstein-Rodan|Paul Rosenstein-Rodan]], and many other intellectuals from all over Europe.

Also during the 1920s and 30s, Mises was battling on two other academic fronts. He delivered the decisive blow to the [[Wikipedia:Historical school of economics|German Historical School]] with a series of essays in defense of the deductive method in economics, which he would later call [[praxeology]] or the logic of [[action]]. He also founded the Austrian Institute for Business Cycle Research, and put his student Hayek in charge of it.

During these years, Hayek and Mises authored many studies on the [[business cycle]], warned of the danger of credit expansion, and predicted the coming currency crisis. This work was cited by the [[Wikipedia:Nobel Memorial Prize in Economic Sciences|Nobel Memorial Prize]] committee in 1974 when Hayek received the award for economics. Working in England and America, Hayek later became a prime opponent of [[Wikipedia:Keynesian economics|Keynesian economics]] with books on exchange rates, capital theory, and monetary reform. His popular book [[Wikipedia:Road to Serfdom|Road to Serfdom]] helped revive the classical liberal movement in America after the [[Wikipedia:New Deal|New Deal]] and [[Wikipedia:World War II|World War II]]. And his series [[Wikipedia:Law, Legislation and Liberty|Law, Legislation, and Liberty]] ([http://books.google.com/books?id=wK49AAAAIAAJ&dq=Law,+Legislation+and+Liberty&printsec=frontcover&source=bl&ots=YAvviNdntc&sig=ZdwmZeD_vlQzvUM5nIIs2xmqp50&hl=en#PPP1,M1 online]) elaborated on the Late Scholastic approach to law, and applied it to criticize egalitarianism and [[Wikipedia:Nostrums|nostrums]] like [[Wikipedia:Social justice|social justice]].

===Outside of Austria===
In the late 1930s, after suffering from the [[Great Depression|worldwide depression]], Austria was threatened by a Nazi takeover. Hayek had already left for London in 1931 at Mises's urging, and in 1934, Mises himself moved to Geneva to teach and write at the [[Wikipedia:Graduate Institute of International Studies|International Institute for Graduate Studies]], later emigrating to the United States. Knowing Mises as the sworn enemy of national socialism, the Nazis confiscated Mises's papers from his apartment and hid them for the duration of the war. Ironically, it was Mises's ideas, filtered through the work of Roepke and the statesmanship of [[Ludwig Erhard]], that led to Germany's postwar economic reforms and rebuilt the country. Then, in 1992, Austrian archivists discovered Mises's stolen Vienna papers in a reopened archive in Moscow.<ref name="Documents">Richard M. Ebeling. [http://www.fff.org/comment/ed0397e.asp "The Discovery of the Lost Papers of Ludwig von Mises"], ''The Future of Freedom Foundation'', March 1997, referenced 2009-04-28.</ref>

While in Geneva, Mises's wrote his masterwork, ''Nationalokonomie'' ([http://www.mises.org/books/nationaloekonomie.pdf pdf]), and, after coming to the United States, revised and expanded it into [[Human Action]] ([http://mises.org/resources/3250 text]), which appeared in 1949. His student [[Murray N. Rothbard]]<ref name="Rothbard">David Gordon. [http://mises.org/about/3249 "Murray N. Rothbard (1926-1995)"], ''[[Mises Institute]]'', referenced 2009-04-28.</ref> called it "Mises's greatest achievement and one of the finest products of the human mind in our century. It is economics made whole." It remains the economic treatise that defines the School. Even so, it was not well received in the economics profession, which had already made a decisive turn towards Keynesian.

Though Mises never held the paid academic post he deserved, he gathered students around him at New York University, just as he had in Vienna. Even before Mises emigrated, journalist [[Henry Hazlitt]] had become his most prominent champion, reviewing his books in the New York Times and Newsweek, and popularizing his ideas in such classics as ''[[Economics in One Lesson|Economics in One Lesson]]'' ([http://fee.org/download/13/ pdf]). Yet Hazlitt made his own contributions to the Austrian School. He wrote a line-by-line [[The Failure of the New Economics|critique]] ([http://www.mises.org/books/failureofneweconomics.pdf pdf]) of Keynes's ''[[The General Theory of Employment, Interest and Money|General Theory]]'' ([http://www.marxists.org/reference/subject/economics/keynes/general-theory/ text]), defended the writings of Say, and restored him to a central place in Austrian macroeconomic theory. Hazlitt followed Mises's example of uncompromising adherence to principle, and as a result was pushed out of four high-profile positions in the journalistic world.

Mises's New York seminar continued until two years before his death in 1973. During those years, Rothbard was his student. Indeed, Rothbard's ''[[Man, Economy, and State]]'' ([http://www.mises.org/rothbard/mes.asp text]) was patterned after Human Action, and in some areas--[[monopoly]] theory, [[utility]] and [[welfare]], and the theory of the state--tightened and strengthened Mises's own views. Rothbard's approach to the Austrian School followed directly in the line of Late Scholastic thought by applying economic science within a framework of a natural-rights theory of property. What resulted was a full-fledged defense of a capitalistic and stateless social order, based on [[property]] and freedom of association and contract.

Rothbard followed his economic treatise with an investigation of the [[Great Depression]], which applied [[Austrian Business Cycle Theory]] to show that the stock market crash and economic downturn was attributable to a prior [[bank]] [[Inflation|credit expansion]]. Then in a series of studies on government policy, he established the theoretical framework for examining the effects of all types of intervention in the market.

In his later years, Mises saw the beginnings of the revival of the Austrian School that dates from the appearance of ''Man, Economy, and State'' and continues to this day. It was Rothbard who firmly established the Austrian School and classical liberal doctrine in the U.S., especially with ''[[Conceived in Liberty]]'' (volumes [http://mises.org/books/conceived1.pdf I], [http://mises.org/books/conceived2.pdf II], [http://mises.org/books/conceived3.pdf III], [http://mises.org/books/conceived4.pdf IV]), his four-volume history of colonial America and the secession from Britain. The reunion of natural-rights theory and the Austrian School came in his philosophical work, ''[[The Ethics of Libery]]'' ([http://www.mises.org/rothbard/ethics/ethics.asp text]), all while he was writing a series of scholarly economic pieces gathered in the two-volume ''Logic of Action'', published in Edward Elgar's ''Economists of the Century'' series.

The founding of the [[Mises Institute|Ludwig von Mises Institute]] in 1982, with the aid of Margit von Mises as well as Hayek and Hazlitt, provided a range of new opportunities for both Rothbard and the Austrian School. Through a steady stream of academic conferences, instructional seminars, books, monographs, newsletters, studies, and even films, they carried the Austrian School forward into the post-socialist age.

The fascinating history of this great body of thought, through all its ebbs and flows, is the story of how great minds can advance science and oppose evil with creativity and courage. Now the Austrian School enters a new millennium as the intellectual standard bearer for the free society. That it does so is thanks to the heroic and brilliant minds that make up the family history of the School, and to those who are carrying that legacy forward.

==Economics and Philosophy==
{{main|Economics}}

Austrian School economists advocate strict adherence to [[Wikipedia:Methodological individualism|methodological individualism]] – analyzing human [[action]] from the perspective of individual agents.<ref name="Mises_Individualism">Ludwig von Mises [http://mises.org/humanaction/chap2sec4.asp "The Principle of Methodological Individualism"], ''[[Human Action]]'' online edition, [[Mises Institute]]. Referenced 2009-04-24}.</ref> Proponents of this method, [[praxeology]], argue that the only means of arriving at a valid economic theory is to derive it logically from basic principles of human action. Proponents of this method hold that it allows for the discovery of fundamental economic laws valid for all human action. Alongside praxeology, the school has traditionally advocated an interpretive approach to history to address specific historical events.

==References==
{{Reflist}}

==External links==
* [http://mises.org/etexts/austrian.asp What is Austrian Economics?] from the [[Mises Institute]]
* [[Wikipedia:Austrian School|Austrian School]] on Wikipedia
* [http://www.econlib.org/library/Enc/AustrianSchoolofEconomics.html Austrian School of Economics] from The Concise Encyclopedia of Economics
* [http://homepage.newschool.edu/het//schools/austrian.htm The Austrian School] from the History of Economic Thought page
* [http://mises.org/daily/4390 A Primer on Austrian Economics] by Jonathan M. Finegold Catalan, June 2010
[[Category:Historical]]

Austrian economics

2010-11-08T06:44:51Z

Catalan: fixing redirect

#redirect [[Austrian Economics]]

User talk:Catalan

2010-11-08T03:04:39Z

Catalan: reply box

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==Welcome!==

Hello, Catalan, and welcome to the Mises Wiki! Thank you for [[Special:Contributions/Catalan|your contributions]]. I hope you like the place and decide to stay.

Please sign your messages on discussion pages using four tildes (<nowiki>~~~~</nowiki>); this will automatically insert your username and the date. If you need help, ask me!

[[User:DickClarkMises|DickClarkMises]] 01:18, 5 November 2010 (CDT)

User talk:Catalan

2010-11-08T03:02:54Z

Catalan: giving it a heading

==Welcome!==

Hello, Catalan, and welcome to the Mises Wiki! Thank you for [[Special:Contributions/Catalan|your contributions]]. I hope you like the place and decide to stay.

Please sign your messages on discussion pages using four tildes (<nowiki>~~~~</nowiki>); this will automatically insert your username and the date. If you need help, ask me!

[[User:DickClarkMises|DickClarkMises]] 01:18, 5 November 2010 (CDT)

Talk:Main Page

2010-11-08T03:01:25Z

Catalan: cmt

User:Catalan

2010-11-05T17:28:13Z

Catalan: core list of articles

Greetings,

My name is Jonathan Finegold (my complete name is "Jonathan Michael Finegold Catalán", which explains my username). I am an experienced Wikipedia editor, registered there since mid-December 2005. You can see my major Wikipedia contributions on my user page: [http://en.wikipedia.org/wiki/User:Catalan User:Catalan]. Regarding economics, I tend to focus on theory and history.

'''Core articles:''' (That I intend on expanding)
# [[Austrian economics]]
# [[Human Action]]
# [[Ludwig von Mises]]
# [[Austrian business cycle theory]]
# [[Capital theory]]
# [[Natural rate of interest]]

User:Catalan

2010-11-05T15:34:51Z

Catalan: starting user page