Handbook on Contemporary Austrian Economics

Handbook on Contemporary Austrian Economics

Elgar original reference

Edited by Peter J. Boettke

This Handbook looks through the lens of the latest generation of scholars at the main propositions believed by so-called ‘Austrians’. Each contributing author addresses key tenets of the school of thought, and outlines its ongoing contribution to economics and to the social sciences.


Peter J Boettke

Subjects: economics and finance, austrian economics, economic psychology


* Peter J. Boettke The Austrian school of economics was founded in 1871 with the publication of Carl Menger’s Principles of Economics. Menger, along with William Stanley Jevons and Leon Walras, developed the marginalist revolution in economic analysis. Menger dedicated Principles of Economics to his German colleague William Roscher, the leading figure in the German historical school, which dominated economic thinking in German-language countries. In his book, Menger argued that economic analysis is universally applicable and that the appropriate unit of analysis is man and his choices. These choices, he wrote, are determined by individual subjective preferences and the margin on which decisions are made. The logic of choice, he believed, is the essential building block to the development of a universally valid economic theory. The historical school, on the other hand, had argued that economic science is incapable of generating universal principles and that scientific research should instead be focused on detailed historical examination. The historical school thought the English classical economists mistaken in believing in economic laws that transcended time and national boundaries. Menger’s Principles of Economics restated the classical political economy view of universal laws and did so using marginal analysis. Roscher’s students, especially Gustav Schmoller, took great exception to Menger’s defense of “theory” and gave the work of Menger and his followers, Eugen Böhm-Bawerk and Friedrich Wieser, the derogatory name “Austrian school” because of their faculty positions at the University of Vienna. The term stuck. Since the 1930s, no economists from the University of Vienna or...