Iâm delighted to announce the publication of a new collection of papers on Austrian economics, The Economic Theory of Costs: Foundations and New Directions (Routledge, 2018).
The Austrian school is growing rapidly, but with so many scholars producing good research, it can also be difficult to keep up with each new contribution. Hence this collection, which provides an overview of several promising developments relating to core problems in Austrian economics.
The unifying theme of the book is the âtheory of cost,â which I use in a general sense to refer to the theory of value and price established by Menger and his students, and its relation to its competitors both old and new. The chapters examine a large number of problems of special interest to Austrians, from the basic elements of action and choice, to the theories of price formation, production and distribution, entrepreneurship, and the firm, to comparative economic systems and alternative institutions. They are thus intended to address fundamental questions in Austrian economicsâthe âmundaneâ problems that make the school unique, and that inspired writers like Menger and Mises. As such, they serve to remind us that economics at its core is not a problem that has been âsolved,â but rather is developing constantly in response to criticism as well as to challenging new events in the world.
The contributors include some of the most thought-provoking people currently working in the Austrian tradition, from established scholars like Joseph Salerno, Jeffrey Herbener, and Guido HĂŒlsmann, to younger economists like Per Bylund, Vlad Topan, Mateusz Machaj, Xavier MĂ©ra, Jonathan Newman, and Patrick Newman. There is even a recently-unearthed draft chapter from Murray Rothbardâs Man, Economy, and State, which outlines his original approach to production theory.
The other topics covered likewise span a wide range of problems in economic theory, including the role of cost in debates about choice and opportunity costs; demand and income effects; production and distribution; risk and interest rates; uncertainty and production; monopsony; Post-Keynesianism; transaction costs; socialism and management; and social entrepreneurship.
Together, these contributions offer an update and restatement of some key elements of Austrian price theory that are central to the economic way of thinking. Each chapter reveals how the Austrian, causal-realist approach to value and costs can be used to solve an important problem or debate in economics. Moreover, the chapters are not only useful for students learning these concepts for the first time: they are also valuable for researchers seeking to understand the unique Austrian perspective and those who want to apply it to new problems.
The table of contents (including links where possible) is below. All of the individual chapters are, or soon will be, available online.
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Introduction: âThe Economic Theory of Costs in Perspectiveâ Matthew McCaffrey
Cost and Choice
Chapter 1: âContemporary Debates on Opportunity Cost Theory and Pedagogyâ Jonathan Newman
Chapter 2: âThe âIncome Effectâ in Causal-Realist Price Theoryâ Joseph T. Salerno
The Evolution of Causal-Realist Production Theory
Chapter 3: âFrom Marshallian Partial Equilibrium to Austrian General Equilibrium: The Evolution of Rothbardâs Production Theoryâ Patrick Newman
Chapter 4: âMan, Economy and State, Original Chapter 5: Producerâs Activityâ Murray N. Rothbard
Risk, Uncertainty, and Cost
Chapter 5: âThe Myth of the Risk Premiumâ Jörg Guido HĂŒlsmann
Chapter 6: âTime and the Theory of Costâ Jeffrey M. Herbener
Causal-Realist Price Theory: Debate and Synthesis
Chapter 7: âMonopsony Theory Revisitedâ Xavier MĂ©ra
Chapter 8: âCosts and Pricing: An Austro-Post-Keynesian Synthesis?â Mateusz Machaj
Economic Organization, Entrepreneurship, and the Firm
Chapter 9: âAustrian Economics and Transaction Cost Economics: Notes on a Doubtful Compatibilityâ Mihai-Vladimir Topan
Chapter 10: âThe Management Problem of Socialism: Cost at the Expense of Valueâ Per L. Bylund
Chapter 11: âEconomic Calculation and the Limits of Social Entrepreneurshipâ Matthew McCaffrey
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The book is on sale now, and even though itâs still relatively expensive, please consider ordering a copy for your universityâs library.