Quarterly Journal of Austrian Economics

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A Theory of Interest

The Quarterly Journal of Austrian Economics

Tags Capital and Interest Theory

07/30/2014Jörg Guido Hülsmann


Volume 5, No. 4 (Winter 2002)


Originary interest does not spring from the passing of time, but from the value relationship between means and ends.  the means of action are inherently less valuable than the ends they serve.  Therefore there is a value spread between means and ends—originary interest—in all human actions in which means and ends can be distinguished.  Originary interest determines how each market participant chooses between production alternative of different length and physical productivity.  The combined originary interests of all market participants determine the time structure of production of the entire economy, as well as of interest rates.




Contact Jörg Guido Hülsmann

Jörg Guido Hülsmann is senior fellow of the Mises Institute where he holds the 2018 Peterson-Luddy Chair and was director of research for Mises Fellows in residence 1999-2004.  He is author of Mises: The Last Knight of Liberalism and The Ethics of Money Production. He teaches in France, at Université d'Angers. His full CV is here.

Cite This Article

Hülmann, Jörg Guido.  "A Theory of Interest." The Quarterly Journal of Austrian Economics 5, No. 4 (Winter 2002): 77–110.