History of the Austrian School of Economics

There are only three possible economic systems: capitalism, socialism, and interventionism. Mises spent his career proving the third is the least understood and the most dangerous.

A labor economist at the University of Chicago devoted his career to Veblen's institutionalism. When he finally saw through the foundations, he told a friend: all my work has been bunk.

Should banks contract credit during a bust? Mises said yes. Rothbard disagreed. Patrick Newman traces a subtle but consequential rift between master and student.

The engineer and the gambler both face uncertainty, but only one can control the forces involved. Jonathan Newman explores the gap between plan and outcome that drives all economic life.

Mises said the modern theory of value didn't just improve economics. It created an entirely new science: the general theory of human action.

Armen Alchian opened a seminar by reading a paragraph on property. Only one person in the room recognized it from Mises's Human Action. It changed everything.

Hülsmann opened Mises's 1912 Theory of Money and Credit expecting a historical curiosity. He found a work that surpassed everything published since.

To spend his compulsory East German currency, Hoppe's only options were Marx, Engels, and Russian novels. Then he found his way to Mises through Friedman and Hayek.

By 1950, the Austrian School was nearly dead. Keynesianism had displaced its business cycle theory, and the profession declared Mises wrong on socialism. Human Action was the counterattack.

Mainstream economics starts with models and works backward to reality. Mises started with reality and worked forward to theory. Herbener explains why that distinction changes everything.