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Is There Progress in Economics?

Is There Progress in Economics?

Knowledge, Truth and the History of Economic Thought

Edited by Stephan Boehm, Christian Gehrke, Heinz D. Kurz and Richard Sturn

This thought-provoking book discusses the concept of progress in economics and investigates whether any advance has been made in its different spheres of research. The authors look back at the history, successes and failures of their respective fields and thoroughly examine the notion of progress from an epistemological and methodological perspective.

Chapter 18: Progess in Austrian economics from Menger to Lachmann

Sandye Gloria-Palermo

Subjects: economics and finance, economic psychology, history of economic thought, methodology of economics


18. Progress in Austrian economics from Menger to Lachmann Sandye Gloria-Palermo INTRODUCTION No doubt progress in economics is not a linear process. The establishing of the Austrian tradition offers one of the most striking instances of this peculiarity. The principles expressed by Menger were not taken up again from the outset by his followers. The first two generations of Austrian authors somehow deviated from the Mengerian originality and it was not until the 1940s that the Mengerian tenets were rediscovered by Mises and Hayek and, later on, in the 1970s, reorganized into a coherent framework. The aim of this paper is to appraise how much road has been covered between MengerÕs embryonic statements and modern formulations of Austrian economics. The question is, apart from deviations and culs-de-sac, how much has been added to MengerÕs original contribution? In order to answer this question it is first necessary to identify what constitutes the core of the Mengerian originality. Dynamic subjectivism, the causalgenetic way of thinking and non-determinacy, it will be argued, represent the bases of the Austrian school as Menger founded it. We will then examine to what extent his followers have been improving on each of these principles. The perspective of the paper is thus rather general, mainly dealing with methodological and conceptual considerations, the objective not being to provide a detailed account of the evolution of particular theories such as business cycle theories or market process theories. THE MENGERIAN ORIGINALITY In MengerÕs view, economics belongs to the...

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