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The Mythology of Capital


  • F. A. v. Hayek


I. Professor Knight's argument, 199.— II. On some current misconceptions: 1. The investment periods and technological progress, 204; 2. They refer to factors, not products, 205; 3. The aggregate of such periods cannot be reduced to an average, nor is measurability essential, 206; 4. The periods refer always to the future, never to the past, 208; 5. The concept does not depend on a distinction between original and produced means of production, 209; 6. Nor is it only the original means of production whose investment periods can be changed, 209.— III. Professor Knight's criticism based on a misunderstanding, 210.— IV. His own position prevents him from giving any explanation of how the limitation of capital restricts the increase of output, 213.— V. An erroneous assertion following from his fundamental position: the value of capital goods when interest disappears, 222.— VI. Problems of capital and "perfect foresight," 225.

Suggested Citation

  • F. A. v. Hayek, 1936. "The Mythology of Capital," The Quarterly Journal of Economics, Oxford University Press, vol. 50(2), pages 199-228.
  • Handle: RePEc:oup:qjecon:v:50:y:1936:i:2:p:199-228.

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    Cited by:

    1. Malte Faber & Ralph Winkler, 2006. "Heterogeneity and Time," American Journal of Economics and Sociology, Wiley Blackwell, vol. 65(3), pages 803-825, July.
    2. Jacques-Laurent Ravix, 1999. "Nature et mesure du capital dans la théorie du capital productif de Böhm-Bawerk," Cahiers d'Économie Politique, Programme National Persée, vol. 35(1), pages 37-61.
    3. Denis O’Brien, 2014. "Hayek in the history of economic thought," Chapters, in: Roger W. Garrison & Norman Barry (ed.), Elgar Companion to Hayekian Economics, chapter 2, pages 11-46, Edward Elgar Publishing.
    4. Vipin P. Veetil, 2016. "Out-of-Equilibrium Dynamics with Heterogeneous Capital Goods," New Mathematics and Natural Computation (NMNC), World Scientific Publishing Co. Pte. Ltd., vol. 12(02), pages 157-173, July.
    5. de Soto Jesus Huerta, 1998. "The Ongoing Methodenstreit of The Austrian School," Journal des Economistes et des Etudes Humaines, De Gruyter, vol. 8(1), pages 1-40, March.
    6. Rajesh C. Shukla, 2017. "Public Policy and Social Good: Theory, Practice and Beyond," Annales. Ethics in Economic Life, University of Lodz, Faculty of Economics and Sociology, vol. 20(4), pages 19-35, December.

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