Konjunktur: Ein Phänomen zwischen Realität und Fiktion – Konjunkturpolitik aus hayekscher Sicht / The business cycle: A phenomenon between reality and fiction – Business cycle policy from a Hayekian viewpoint

The present paper deals with an astonishing presumption used frequently in politics, economic affairs as well as in the media. There it is argued as if the business cycle is a fact of economic life. Here it will be argued to the contrary, namely that there is no convincing evidence for the business cycle, that it is a fiction, a product of imagination inspired by some statistical observations which can hardly be explained by applying economic theory. Three verdicts of Hayek will be employed to argue that the legal framework for a business cycle policy should be critically assessed in view of (1) “the errors of macroeconomics”, (2) “the Keynesian dream” and (3) “the pretence of knowledge”. In this paper the argument runs as follows: In part A, the phenomenon will be assessed with regard to its empirical and theoretical quality. In part B, the consequences for the legal framework of an economic policy directed to the presumed business cycle will be analyzed. Part C will be a summary of the argument by repeating those theses and their subsequent explanations, which may help structuring the argument.