B53 - Current Heterodox Approaches: AustrianNávrat zpět

This critical review explains the negative impact of the euro on the Spanish economy and its distortion in the period from 2002 to 2014. In this first cycle within the euro area, there was a financial boom, without voluntary savings, which generated a lack of coordination in the economic process and structure. The result was a bubble of overconsumption and malinvestments, which burst with a deflation of capital and wages, and a switch from construction industry to tourism services as Spain's main economic sector. The economic distortion was such that it delayed the exit from the Great Recession of 2008 and the European Financial Crisis of 2010 until 2014, with a recovery and the beginning of a new cycle. The Austrian business cycle theory and capital-based macroeconomics are used to support and illustrate the case study, with quantitative techniques: not to predict, but only to show the real development and to facilitate dialogue with other economic schools.

Very low real rates of interest observed in modern economies might be caused by the fact that the natural rate of interest declined to a zero level. This article shows that a zero or a negative natural interest can be explained by the Böhm-Bawerkian and neoclassical theory. Firstly, two senses of time preference are introduced in a discounted utility model, and key determinants of the zero interest rate on the side of time preference are discussed in detail. Secondly, a simple general equilibrium model with fixed intertemporal endowment is presented. Within this model, a decreasing shape of the income stream is identified as a major source of zero interest along with a low intertemporal elasticity of substitution in consumption. Even in the world of zero or negative natural interest, it might be optimal to be a lender. The last section focuses on the role of marginal productivity of capital in the model, stressing the role of this phenomenon on one side and time preference on the other in lowering the natural rate of interest to a zero level.

In recent years, economic approach to human behavior has been challenged by contributions of cognitive science under the name of behavioral economics. As a result, two methodological strands in economics discord with each other: objectivistic (naturalistic) approach refuses the role of motivations in human behavior, adopting methods of natural science; subjectivistic (interpretative) approach, on the other hand, takes the teleological structure of human action as its corner stone. It is argued that position of the latter (esp. rational choice theory) has been undermined because it builds upon primitive version of human teleological structure. The paper shows that phenomenology offers a promising solution. Phenomenology identifies typical, invariant structures of human action and social world, with various degrees of their anonymity. If economic approach is founded on those structures adequately, then both rational choice theory and bounded rationality theories become compatible, as they differ in their degrees of anonymity only; they both belong to the body of (subjectivistic) economic approach to human behavior.

According to quite a number of scholars, even non-Austrian, some theories of Austrian school of economic thought do provide an increasingly relevant material to explain recent boom-and-bust economic cycles as well as financial crises. However, I argue, this development is not adequately reflected by a corresponding growth of Austrian influence within the economic orthodoxy. Quite to the contrary, many orthodox scholars have taken over rigidly Keynesian positions since the financial crisis culminated in 2008 and 2009. In my article I maintain that Austrians themselves have contributed significantly to such a situation by not preventing three major tactical mistakes, related to the domain of sociology of economics, from occurring. Firstly, they have not formed a really unified and thus influential group of scholars; instead, they have been divided into a few streams, sometimes with highly contradictory stances. Secondly, many Austrians have made bold predictions, especially with regard to possible enormous inflation stemming from the unprecedented provision of liquidity to the financial system during and in the aftermath of the financial crisis of 2008 and 2009, which have not been fulfilled at all. Thirdly, a critical number of Austrian school's economists do not effectively communicate with the rest of the profession and even, it seems, fail to adequately comprehend the orthodox analytical tools and theories.

The study analyzes Mises's approach to the question of apriorism in a broader methodological context. It shows that it is not inevitable to advocate the aprioristic character of economics (resp. science of human action), as Mises does, to maintain the subjectivist-individualist methodology and the effort to adequately grasp the general laws of human action from its perspective. The present redefinition of apriorism is developed on the basis of thoughts of Barry Smith and Alfred Schutz. It suggests abandoning the apodictic character of apriori (which is untenable) and move closer to a broadly defined empiricism. The methodological insights developed in the paper are finally used to contribute to the debate between the behavioral economists and the proponents of rational choice theory.

This paper deals with the recent empirical phenomenon of intraindustry trade, i.e. trade in similar goods between similar countries. It treats this phenomenon from the point of view of the theory of structure of production, highlighting the importance of sequential nature of production and heterogeneity and specificity of factors of production, as developed by Carl Menger, Eugen von Boehm-Bawerk and their followers of the so-called Austrian school of economics. Simple theory of production structure, along the lines of Austrian economics, is presented and a useful tool for the analysis of intraindustry trade is developed. In the following discussion we make the case for vertical intraindustry specialization, complex manufactured goods and sliced-up production chains across countries. The reader immediately observes the importance of Austrian production structure theory for the analysis of intraindustry trade. We accordingly apply the concepts of the structure of production on intraindustry trade and analyze, in particular, the time- and place-aspects of international production. Finally, we show the relevance of our approach to intraindustry trade for the analysis of business cycle synchronization and Optimum currency areas theory.

The paper shows the current state of environmental concerns in economic theory. Different economic schools have incorporated the environmental analysis into their theoretical framework. They use different presumptions, focus on different environmental aspects and come to diverse conclusions and political recommendations. However, there are many unclear frontiers between one another. This paper would like to help to understand these differences. It characterises and compares the main economic schools and theories. The paper focuses on environmental economics, ecological economics, new institutional economics, free market environmentalism, coevolutionary theory in economics and bioeconomics.

One of the distinctive features of the Austrian school of economics is its emphasis on the methodological foundations of economics and social sciences in general. The two pillars of the approach of this school are methodological individualism and subjectivism. The purpose of this essay is not only to identify a few of the principles with which most Austrians are in agreement but also to emphasise significant diversity within their common viewpoint. An accent is put on praxeology introduced by Mises and Hayek's requirement of "empirical elements" concerning the processes of human learning. It is further emphasised that within this diversity has run and continues to run a common thread of emphasis on man as an intentional, creative being, an actor rather than a mere passive responder to given constraints and circumstances. The essay treats the development of the Austrian methodology mainly under the separate heads of its individual contributors.

The aim of this paper is to introduce the market process as a central concept of Austrian economics as opposed to the general-equilibrium approach of the neoclassical school. In the first part the author shortly reviews the theme of entrepreneur and understanding of entrepreneurial function in the history of economic thought. In the second chapter the formation of the Austrian view of the market as an entrepreneurially driven process and simultaneous emergence of criticism of mainstream theory is explained. The chapter three describes the Austrian understanding of the market process based upon twin concepts of sheer ignorance and entrepreneurial discovery. The last chapter introduces the entrepreneurial market process theory of Schumpeter. Schumpeter's theory is subsequently compared with Kirzner's approach. The author also surveys and compares modern discussions about market process within the Austrian school of economics.