Fundamentals of Economic Analysis: A Causal-Realist Approach

1. Scarcity, Choice, and Value

Austrian Economics OverviewPhilosophy and MethodologyValue and Exchange

06/11/2007Mises Media
In this first lecture of a series of lectures covering the basics of applied Austrian economics, Joseph Salerno introduces a number of basic concepts including utility, exchange, psychic cost, choice, value, and marginal utility.
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2. Exchange and Demand

Austrian Economics OverviewMonetary TheoryPhilosophy and MethodologyProduction Theory

06/12/2007Mises Media
All action is really exchange. What the actor prefers less is exchanged for something he prefers more, including gift giving. It is a fallacy to say that the goods exchanged have equal value.
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3. The Determination of Prices

Austrian Economics OverviewCapital and Interest TheoryPrices

06/12/2007Mises Media
What determines market prices? Buyers and sellers must know of feasible trades. They can learn from their mistakes. They prefer higher profits to lower profits. They think in discreet terms. Both participants win in market exchanges.
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4. Price Controls: Case Studies

Austrian Economics OverviewInterventionismPrices

06/13/2007Mises Media
As with all government intervention, price controls do not achieve what their originators think they will. Trying to maintain a supply of milk by putting a price control on it will cause shortages, which are the very situations the price manipulators said they wanted to avoid.
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5. Pricing of the Factors of Production and the Labor Market

Austrian Economics OverviewPricesProduction Theory

06/13/2007Mises Media
Factors of Production are economic goods: scarce means used to achieve an individual’s ends. They are land, labor and capital. Each is examined. Incomes are earned by factor owners as production takes place. There is no separated production and distribution.
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6. Profit, Loss and the Entrepreneur

The EntrepreneurAustrian Economics OverviewEntrepreneurship

06/14/2007Mises Media
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.
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7. Capital, Interest and the Structure of Production

Austrian Economics OverviewCapital and Interest TheoryProduction Theory

06/14/2007Mises Media
Time preference says that individuals prefer satisfaction now to later, present to future. This explains the loan market. In the structure of production, the capitalist pays wages now, despite the fact that he himself does not get paid until the final stage when the product actually comes to market.
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8. Competition and Monopoly

Austrian Economics OverviewMonopoly and Competition

06/15/2007Mises Media
Competition can mean rivalry or freedom. All firms must serve the preferences of consumers in order to exist. Monopoly has historically been an artificial privilege granted by the state.
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9. Money and Prices

Money and BanksAustrian Economics OverviewPhilosophy and MethodologyPrices

06/15/2007Mises Media
In the history of money, bartering was awkward because wants were not divisible. Direct exchange depended upon a double coincidence of wants. Demand for a medium of exchange grew until a general medium of exchange emerged, like gold and silver.
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10. Banking and the Business Cycle

Money and BanksBusiness CyclesMoney and Banking

06/16/2007Mises Media
We have today a hybrid of two forms of banking – loan banking (non-inflationary) and deposit banking (inflationary if not 100% reserve holdings). The cause of booms is the credit expansion by central banks that is not backed by pools of private savings.
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