Imagine the economy as a roller coaster—a ride with thrilling booms that must be followed by the inevitable dread of busts, at least if the booms are artificially enhanced. Welcome to the Austrian business cycle theory (ABCT), a theory that translates these physical rules to economic ideas and explains the volatile ups and downs of an economy. This theory isn’t just an academic exercise, but it’s also a practical tool that helps us anticipate and prepare for economic fluctuations.

This lecture was originally delivered at the 2019 Austrian Economics Research Conference at the Mises Institute in Auburn, Alabama.

These imperialistic doctrines are common to all peoples today. Englishmen, Frenchmen, and Americans who marched off to fight imperialism [in World War I] are no less imperialistic than the Germans.

—Ludwig von Mises, Nation, State, and Economy (1983, p. 79)