Austrian Economics Overview

Rothbard considers how prices are determined by supply and demand on the free market. All long shortages are caused by government interventions. Forecasting is not possible. Economics is not an objective science.

From The Failure of the “New Economics”. Narrated by Josiah Schmidt.

What causes business cycles? Keynesians say the cycles happen because the free market economy does not spend enough. Thus, pump spending in. Additionally, Keynesians say that animal spirits cause these cycles. Government must fix things. Nobody could understand Keynes' General Theory. What was simply obscure was wrongly considered deep.

From The Failure of the “New Economics”. Narrated by Josiah Schmidt.

Starting with Crusoe economics, Rothbard builds the economic concepts which can be developed by this analogy. These concepts are the axiom of human action. Among them are: man acts, man acts by virtue of his existence, man acts with purposeful behavior,...

From The Failure of the “New Economics”. Narrated by Josiah Schmidt.

From The Failure of the “New Economics”. Narrated by Josiah Schmidt.

Costs are always ex ante. There are no such things as social costs or social benefits. Costs are determined by how much entrepreneurs think consumers will pay. Costs are not determined by supply and demand. Nobody waits for costs to raise prices

From The Failure of the “New Economics”. Narrated by Josiah Schmidt.

Deficits are equal to expenditures minus taxes. Reagan spoke of cutting government spending, but meant only cutting the rate of growth of government spending. Stagflation appeared in 1957-58. Inflation during a recession was not supposed to happen. It happened again in 1973-75.