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Towards a New Austrian Macroeconomics

Author

Listed:
  • Vipin P. Veetil

    (George Mason University)

  • Lawrence H. White

    (George Mason University)

Abstract

Austrian macroeconomists of the interwar period saw the economy as a complex adaptive system, in which macroeconomic variables emerge from the interaction between millions of purposefully acting agents. Recent advances in computation technology allow us to build empirically salient synthetic economies in silico, and thereby formalize many Austrian insights. We present a workhorse model with firms on an input-output network. Macroeconomic variables evolve through the interaction between micro-economic decisions. We use the model to explain an effect of monetary shocks on the price distribution and provide a sketch of other potential applications.

Suggested Citation

  • Vipin P. Veetil & Lawrence H. White, 2017. "Towards a New Austrian Macroeconomics," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 30(1), pages 19-38, March.
    • Handle: RePEc:kap:revaec:v:30:y:2017:i:1:d:10.1007_s11138-016-0354-z
    DOI: 10.1007/s11138-016-0354-z
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    Cited by:

    1. Veetil, Vipin P. & Wagner, Richard E., 2018. "Nominal GDP stabilization: Chasing a mirage," The Quarterly Review of Economics and Finance, Elsevier, vol. 67(C), pages 227-236.

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    More about this item

    Keywords

    Macroeconomics; Agent-based model; Schumpeter; Mises; Hayek; Business cycles; Cantillon effect;
    All these keywords.

    JEL classification:

    • E00 - Macroeconomics and Monetary Economics - - General - - - General
    • E14 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Austrian; Evolutionary; Institutional
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General

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