Subjectivism

Although Adam Smith is well-known for emphasizing division of labor, his analysis was woefully incomplete, as Dr. Mark Thornton points out.

Economists consider probability to be central to economic analysis, but, as Ludwig von Mises wrote, economic action involves unique and purposeful events, not random ones.

The Austrian economics framework shows that subjective valuation is not shown to be arbitrary, but rather purposeful, as people place values on things via a means-end framework.

When economists try to analyze the economy, one procedure is to remove the “seasonal” component from the data in order to account for trends and fluctuations. That collides with the thinking behind praxeology in which human beings engage in purposeful behavior.

Price theory is the cornerstone of the foundation of economic calculation.

Praxeology is the science of human action.

College professors have suddenly discovered entrepreneurship and are teaching about it in their classes. However, while it is an interesting subject, one cannot teach someone how to be a successful entrepreneur. 

College professors have suddenly discovered entrepreneurship and are teaching about it in their classes. However, while it is an interesting subject, one cannot teach someone how to be a successful entrepreneur. 

Six hundred years before Carl Menger wrote his Principles, Thomas Aquinas was writing about the role of subjective valuation in economic exchanges. His work helped lay the groundwork for further advances in economic theory.

The Austrian school recognizes that economic analysis is timeless and the ancient story of “The Poor Man of Nippur” provides an excellent example. From time preference to the structure of production, many of the lessons are contained in this story.