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Austrian Business Cycle Theory: An Evolution and Contemporary Condition
[Теория Экономического Цикла Австрийской Школы: Эволюция И Современное Состояние]


  • Kavaliou, Aliaksandr (Ковалев, Александр)

    () (Centre for Business Education, European Humanities University)


The aim of the paper is to analyze the process of evolution of Austrian Business Cycle Theory (ATBC). The theory was very popular until 1940 however after that it was in the shadow for the long years. The theory explains business cycle with fiduciary credit and other governmental distortion which lower interest rates and lead to incorrect capital structure compare to sustainable growth which supported by voluntary savings. ATBC considers laissez-faire as the most effective anticyclical economic policy. The paper presents the contribution to the theory made both by former leaders of the school (Mises, Hayek) and by contemporary adepts of the school.

Suggested Citation

  • Kavaliou, Aliaksandr (Ковалев, Александр), 2015. "Austrian Business Cycle Theory: An Evolution and Contemporary Condition
    [Теория Экономического Цикла Австрийской Школы: Эволюция И Современное Состояние]
    ," Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 2, pages 43-62.
  • Handle: RePEc:rnp:ecopol:1526

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    References listed on IDEAS

    1. repec:mes:ijpoec:v:20:y:1990:i:4:p:14-41 is not listed on IDEAS
    2. S. E Oppers, 2002. "The Austrian Theory of Business Cycles; Old Lessons for Modern Economic Policy?," IMF Working Papers 02/2, International Monetary Fund.
    3. L. Grebnev., 2007. "On the Subject Matter of Economic Science, or Where Should We Begin while Teaching Economics?," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 8.
    4. Vaughn,Karen I., 1994. "Austrian Economics in America," Cambridge Books, Cambridge University Press, number 9780521445528, June.
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    More about this item


    Austrian school; business cycles; fiduciary media; malinvestment; capital structure;

    JEL classification:

    • B13 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Neoclassical through 1925 (Austrian, Marshallian, Walrasian, Wicksellian)
    • B53 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Austrian


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