What Happened To Hayeks Capital Theory

Three of Hayek' s ideas appear to have proved most fertile in the discussions of recent years 1 The stock of capital does not constitute a measurable quantity. 2 The notion of ' intertemporal' or ' dynamic' equilibrium. 3 The reinterpretation of the 'higher productivity of roundabout methods of production' as the process in the course of which 'as investment proceeds, more and more of those natural forces which before were only potential resources are utilized and gradually drawn into the...

Subjectivism In Microeconomics

A' change in methods of production in a given state of knowledge' is, strictly speaking, a contradiction in terms. When we ask how much of the subjectivist view of human action, sketched briefly, if inadequately, in the last section, has been absorbed into the main body of modern economic thought, it will be best to distinguish, as regards the latter, between micro- and macro-economics. For the relationship between the subjectivist view and macroeconomics, and in particular the treatment it...

Monetary Overinvestment Theory And Adjustment

We have thus far attempted to describe the neoclassical notion of adjustment, and to examine the conditions contingent upon its attainment. We came to the conclusion that this type of analysis fits best the case of partial depressions, where the system as a whole has remained unaffected, but encounters considerable difficulties in the case of overinvestment crises. We now shall have to study the views of an important group of neoclassical economists, the outstanding representative of whom is...