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The Historical Setting of the Austrian School of Economics

  • Historical Setting of the Austrian School of Economics by Mises

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09/01/2007Ludwig von Mises

The essay was first published in 1969. It was one of the last pieces Mises wrote.

The peculiar state of German ideological and political conditions in the last quarter of the nineteenth century generated the conflict between two schools of thought out of which the Methodenstreit and the appellation "Austrian School" emerged. But the antagonism that manifested itself in this debate is not confined to a definite period or country. It is perennial. As human nature is, it is unavoidable in any society where the division of labor and its corollary, market exchange, have reached such an intensity that everybody's subsistence depends on other people's conduct.... Governments, political parties, pressure groups, and the bureaucrats of the educational hierarchy think they can avoid the inevitable consequences of unsuitable measures by boycotting and silencing the independent economists. But truth persists and works, even if nobody is left to utter it.


Ludwig von Mises

Ludwig von Mises was the acknowledged leader of the Austrian school of economic thought, a prodigious originator in economic theory, and a prolific author. Mises's writings and lectures encompassed economic theory, history, epistemology, government, and political philosophy. His contributions to economic theory include important clarifications on the quantity theory of money, the theory of the trade cycle, the integration of monetary theory with economic theory in general, and a demonstration that socialism must fail because it cannot solve the problem of economic calculation. Mises was the first scholar to recognize that economics is part of a larger science in human action, a science that he called praxeology.

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