Fundamentals of Economic Analysis: A Causal-Realist Approach

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6. Profit, Loss and the Entrepreneur

  • Fundamentals of Economic Analysis

Tags The EntrepreneurAustrian Economics OverviewEntrepreneurship

06/14/2007Peter G. Klein

Causal-realist analysis allows imaginary constructs like the ERE- Evenly Rotating Economy- in order to isolate certain factors like interest.  There would be no profit or loss in the ERE, because those can only exist under conditions of uncertainty.

Klein explains profit as a category, not a line item. The entrepreneur’s function is to experiment with combinations of factors of production to find those that produce the greatest economic value.

The sixth in a series of ten lectures, from Fundamentals of Economic Analysis: A Causal-Realist Approach.

6. Profit, Loss and the Entrepreneur | Peter G. Klein

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Contact Peter G. Klein

Peter G. Klein is Carl Menger Research Fellow of the Mises Institute and W. W. Caruth Chair and Professor of Entrepreneurship at Baylor University's Hankamer School of Business.

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