Business Cycles

Garrison has a vivid sense for the necessity of adequate pedagogy to communicate Austrian ideas about the working of the economy, and he is very conscious of the power of symbols. 

That Hayek’s work on money, investment, and business cycle theory should be misunderstood and misrepresented poses nothing new. 

We contribute to the debate over the contemporary relevance of the Austrian Business Cycle theory (ABC) by making three theoretical developments.

Rothbard (1963) provides a compelling explanation of the Great Depression. He used the Austrian business cycle theory to show that the inflationary policies of the Federal Reserve

Paolo Sylos Labini (1920–2005) was the one of the most influential economists in Italy after the Second World War. After graduating in 1942, Sylos Labini won a fellowship in the USA. 

Monetary disequilibrium theory has some common ground with Austrian economics, but there is substantial disagreement regarding the analysis of business cycles.

In this article, the prime concepts are based on the Mises-Hayek theory of the business cycle.  Using this model as the general framework for analysis, additions and modifications are introduced reflecting theoretical advances and current problems

 According to this writer Garrison’s Time and Money is precisely what it purports to be: an exercise in comparative frameworks. Even if it should be recognized that the comparison

ABC theory is founded on the concept of a sustainable, market-determined interest rate, and predicts negative consequences when that equilibrium is persistently disturbed. 

Ludwig von Mises established the foundations of modem Austrian economics while Irving Fisher established the foundations of modem mainstream macroeconomics and central bank policy.