The Economics of Illusion

As, in my opinion, the objections raised to my Volkswirtschaftliche Theorie des Bankkredits can, with the same justification, be raised against Keynes’ work, excerpts of two of these criticisms, namely, one by Professor Howard S. Ellis and one by Professor Gottfried von Haberler, are reprinted in the following pages. Both criticisms give a good summary of the contents of my book, thus enabling the reader to compare them with Keynes’ work.

There is also reprinted in the following pages an article “The Gold Exchange Paradox” which I was reluctant to include in the main part of the book because it deals with a situation no longer existent. On the other hand, I thought it should be reprinted because certain conclusions arrived at in the article, namely, the incompatibility of internal inflation and external currency stabilization, can be applied to the problems of today.

There follows for readers interested in my earlier work a table of contents of my two books Geld und Kredit (1924) and Geld und Kredit, Neue Folge (1929).

Finally, I have added a list of those of my articles written after 1929 which have not been included in the present book because they are not of interest to the American reader of today. One of the articles mentioned, namely, “Deficit Spending and Private Enterprise,” a lecture delivered at Harvard University and reprinted in the U. S. Chamber of Commerce Bulletin No. 8, has not been included in order to avoid certain repetitions.