Quarterly Journal of Austrian Economics
The Methodology of Profit Maximization: An Austrian Alternative
Volume 8, No. 4 (Winter 2005)
This paper has incorporated challenges to the dominant neoclassical model that were fashioned by Rothbard and, to a much lesser extent, Baumol. In examining the work of both economists, we conclude that the Rothbard model is more complete, as it factors time into the model, where Baumol’s does not, which renders it fatally incomplete. Both authors, however, make a solid point that if one is to analyze the workings of the firm in the real world, other models such as revenue maximization must be taken into account if we are to assume that firms attempt to maximize profits.
Cite This Article
Anderson, William L. and Ronald L. Ross. "The Methodology of Profit Maximization: An Austrian Alternative." The Quarterly Journal of Austrian Economics 8, No. 4 (Winter 2005): 31–44.