Austrian Economics: A Tale of Lost Opportunities

Abstract

This is a, somewhat indirect, rejoinder to Boettke (2019, this volume, Chapter 1). Doing Austrian economics is low prestige: Austrian economics does not get published in high-prestige journals and Austrian economists are not employed by top universities. And yet, up until World War II Austrian economics was an important part of the international economics community. The author argues that Austrian economists made several theoretical innovations that could have placed them at the frontier of research in economics, and present a brief counterfactual history of a thriving Austrian economics based on those innovations. However, the actual history of the Austrian School is quite different. A particularly decisive factor that has made Austrian economics a fringe movement was the rejection of formal methods in theory and empirics. The author argues that Austrian economics is basically dying out as a voice in the conversation of modern economists.

Citation

Foss, N.J. (2019), "Austrian Economics: A Tale of Lost Opportunities", D'Amico, D.J. and Martin, A.G. (Ed.) Assessing Austrian Economics (Advances in Austrian Economics, Vol. 24), Emerald Publishing Limited, Leeds, pp. 111-123. https://doi.org/10.1108/S1529-213420190000024011