- Elgar original reference
Edited by Peter G. Klein and Michael E. Sykuta
Nicolai J. Foss and Peter G. Klein As the transaction cost theory of the firm was taking shape in the 1970s, another important movement in economics was emerging: a revival of the ‘Austrian’ tradition in economic theory associated with such economists as Ludwig von Mises and F.A. Hayek (Dolan, 1976; Spadaro, 1978). As Oliver Williamson has pointed out, Austrian economics is among the diverse sources for transaction cost economics (TCE) (Klein, 2010, pp. 187–193). In particular, Williamson frequently cites Hayek (for example, Williamson, 1985, p. 8; 1991, p. 162), particularly Hayek’s emphasis on adaptation as a key problem of economic organization (Hayek, 1945). Following Williamson’s lead, a reference to Hayek’s ‘The Use of Knowledge in Society’ (Hayek, 1945) has become almost mandatory in discussions of economic organization (for example, Ricketts, 1987, p. 59; Milgrom and Roberts, 1992, p. 56; Douma and Schreuder, 1991, p. 9). However, there are many other potential links between Austrian economics and TCE that have not been explored closely and exploited. This chapter argues that characteristically Austrian ideas about property, entrepreneurship, economic calculation, tacit knowledge, and the temporal structure of capital have important implications for theories of economic organization, TCE in particular. Austrian economists have not, however, devoted substantial attention to the theory of the firm, preferring to focus on business-cycle theory, welfare economics, political economy, comparative economic systems, and other areas. Until the 1990s the theory of the firm was an almost completely neglected area in Austrian economics, but since then, a small Austrian...
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.