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The epithet “Austrian” in “Austrian economics” is applied to the work of economists as far apart in time as Carl Menger, whose Grundsätze der Volkswirthschaftslehre (Principles of Political Economy) first appeared in 1871, and Ludwig Lachmann, Israel Kirzner and Murray Rothbard, writing a century or more later. It would be vain to attempt to define Austrian economics by a set of beliefs, commonly held by its adherents. There is much to be said for following Zuidema (1987), who prefers to speak of “styles” rather than “schools”. This implies that there need be no clear‐cut dividing lines between Austrians and the rest of the economics fraternity and that not all those dubbed “Austrian” are necessarily “typically” Austrian all of the time. There certainly seems to be a style of reasoning that can be seen as specifically Austrian. Some of the components of a “style” mentioned by Zuidema are:

The controversy between Hayek and Keynes in the 1930s is probably one of the best‐known disputes in economics and several comments have been made on this episode (Hicks, 1967; Machlup, 1977; Fletcher, 1987). In the assessments little attention has been paid to the development of the ideas of the two economists, to the views they had in common and to the influence they had on each other. These aspects will be taken into consideration in this contribution with the aim of extending our knowledge of the fundamental points of disagreement between them. The crucial question is how it came about that Hayek and Keynes, who for some time studied very similar monetary problems, ended as such fierce opponents on the question of how a modern capitalist system works. Keynes went as far as denying that the market system is self‐adjusting, whereas Hayek, especially in his later writings, propounded the view that markets constitute an efficient mechanism for the satisfaction of human needs.

Discusses the ideas and theories of Professor F.A. Hayek and assesses their relevance to present day social economics. Opens with the theory of business‐cycles and compares Hayek′s ideas with those of Keyne′s in this area. Follows on with dynamic market theory and the theory of evolution of social institutes. Concludes with a summary of all three expanding their legacy – that they are models for future research.

Discusses the ideas and theories of Professor F.A. Hayek and assesses their relevance to present day social economics. Opens with the theory of business‐cycles and compares Hayek′s ideas with those of Keynes in this area. Follows on with dynamic market theory and the theory of evolution of social institutions. Concludes with a summary of all three expanding their legacy – that they are models for future research.

In the early 1930s, Nicholas Kaldor could be classified as an Austrian economist. The author reconstructs the intertwined paths of Kaldor and Friedrich A. Hayek to disequilibrium economics through the theoretical deficiencies exposed by the Austrian theory of capital and its consequences on equilibrium analysis.

The author approaches the discussion using a theoretical and historical reconstruction based on published and unpublished materials.

The integration of capital theory into a business cycle theory by the Austrians and its shortcomings – e.g. criticized by Piero Sraffa and Gunnar Myrdal – called attention to the limitation of the theoretical apparatus of equilibrium analysis in dynamic contexts. This was a central element to Kaldor’s emancipation in 1934 and his subsequent conversion to John Maynard Keynes’ The General Theory of Employment, Interest, and Money (1936). In addition, it was pivotal to Hayek’s reformulation of equilibrium as a social coordination problem in “Economics and Knowledge” (1937). It also had implications for Kaldor’s mature developments, such as the construction of the post-Keynesian models of growth and distribution, the Cambridge capital controversy, and his critique of neoclassical equilibrium economics.

The close encounter between Kaldor and Hayek in the early 1930s, the developments during that decade and its mature consequences are unexplored in the secondary literature. The author attempts to construct a coherent historical narrative that integrates many intertwined elements and personas (e.g. the reception of Knut Wicksell in the English-speaking world; Piero Sraffa’s critique of Hayek; Gunnar Myrdal’s critique of Wicksell, Hayek, and Keynes; the Hayek-Knight-Kaldor debate; the Kaldor-Hayek debate, etc.) that were not connected until now by previous commentators.

The quite difficult task of comparing Hayek's and Schmoller's concept of social policy can only be attempted by confining the discussion to the dominant and basic principles of their prevailing ideas. The reasons are manifold. Just one of them for instance is that Schmoller, as far as I can see, never gave us any workable definition of this ambiguous term, and for Hayek this term is a politically much abused and empty phrase. Another would be that Hayek referred to Schmoller only sporadically and treated the latter's voluminous oeuvre only very peripherally in his own relevant work. I, therefore, suggest the concentration mainly on Hayek's critique of Schmoller's two important components of his somewhat “syndicalistic” system which determined his vague, but still relevant concept of “social policy”.

Discusses, after an introduction, Hayek’s life from his early Viennese upbringing and his education at Vienna University, plus his further work at New York University and the London School of Economics, the University of Chicago and several notable others. Covers his lecture in 1974 about the pretence of knowledge and his ideals. Declares that the lecture contains good advice in all sciences.

Nobody concerned with political economy can neglect the history of economic doctrines. Structural changes in the economy and society influence economic thinking and, conversely, innovative thought structures and attitudes have almost always forced economic institutions and modes of behaviour to adjust. We learn from the history of economic doctrines how a particular theory emerged and whether, and in which environment, it could take root. We can see how a school evolves out of a common methodological perception and similar techniques of analysis, and how it has to establish itself. The interaction between unresolved problems on the one hand, and the search for better solutions or explanations on the other, leads to a change in paradigma and to the formation of new lines of reasoning. As long as the real world is subject to progress and change scientific search for explanation must out of necessity continue.

This paper examines Hayek’s version of methodological individualism in relation to individual economic actions and economic effectiveness (social actions). According to this approach, economic and social order is determined by the myriad atomistic actions that are the result of individual planning taking into consideration the idiosyncratic nature of knowledge. Economic policy is a form of social planning which is not only ineffective but also has cataclysmic long‐lasting effects, creating a disorder in the market system. Two arguments are made in this study. First, methodological individualism should be considered and be accepted as a serous attempt to explain atomistic (economic) behaviour as purposeful actions constrained by scarce resources and limited knowledge. Second, Hayek’s strong version of methodological individualism is very simplistic as it is applied to economic policy issues, contradicting his argument in support of a methodological dualism.

It is demonstrated that the Austrian school in economics had very different ideas about the creation and change of social institutions and especially about the relation of state and market, which is still one of the fundamental problems of economic theory. Menger′s fundamental distinction of pragmatic and organic institutions and Wieser′s contrary model are discussed, followed by the “impossibility theorem” of Mises and the contrary position of Schumpeter. Hayek′s liberation model of society is presented and criticised, and finally Menger′s position is interpreted as one of moderate liberal interventionism.