The archive.

At the heart of Schumpeter's theory of capitalist development lies a startling doctrine: a stationary circular-flow economy would have a zero rate of interest, and the positive rate observed under capitalism springs entirely from innovation financed by newly created bank credit. Haberler weighs this extreme version against a milder one and finds the extreme untenable, since it demands both the absence of time preference and zero marginal productivity of capital, assumptions he doubts once routine investment and ordinary impatience are admitted. Yet he defends Schumpeter's larger dynamic account, ranking its disequilibrium approach above the excessively static equilibrium theory of Mises and Hayek, who deny that credit expansion can permanently enrich the capital stock. The comparative question of whether dynamics raises or lowers interest, he concludes, is a comparatively unimportant detail.

The extreme version of his theory is hardly acceptable.

Can the word 'profit' keep a precise role in economic theory once production is recognized as action stretched through time and shadowed by uncertainty? Shackle's answer is that it cannot serve as one concept, because it silently names two: the imagined inducement that draws an enterpriser into a venture and the recorded result by which the finished venture is judged. Productive services are committed long before the product's exchange value can be known, so contractual payments merely shift uncertainty onto the equity owner rather than abolishing it. Ex ante profit, on this account, is no scalar to be maximized but a configuration of hoped-for gain and feared loss, handled through focus-gain, focus-loss, and the φ-surface. To confuse that conjectural lure with its retrospective outcome, he warns, is an error bred by static, timeless thinking; the argument was spurred by J. A. Stockfisch and J. Fred Weston.

It is only in a static analysis, the description of a situation which is essentially timeless, that a single concept of ‘profit’ could ever be enough.

Human Action supplies the occasion, but the deeper subject is the autonomy of the social sciences against positivism. Reading Mises's treatise, Lachmann fixes on its methodological core: the distinction between praxeology, the general science of human action, and catallactics, the analysis of market exchange, and the claim that categories such as means, ends, choice, and time are presupposed rather than generalized from data. He presses the argument toward process—profit and loss as signals that sort successful anticipations from failed ones—and toward a capital theory that abandons Böhm-Bawerk's average period of production for heterogeneous, time-structured assets. That perspective grounds his reading of socialist calculation, which fails for want of an entrepreneurial capital market, and of the trade cycle, where credit expansion breeds malinvestment rather than mere excess.

There is therefore such a thing as a Logic of Action closely linked to the logic of our thought.

Reviewing R. F. Harrod's admiring life of John Maynard Keynes, Mises grows impatient with its chronicle of clubs, dinners, and distinguished acquaintances, and presses the question the biographer avoids: did Keynes truly shape the age, or merely flatter it? His verdict is deflationary. Governments had practiced inflation, credit expansion, and deficit finance long before The General Theory; Keynes did not inaugurate that policy but dressed it in scientific respectability for progressives who already scorned thrift, laissez faire, and capital accumulation. The title carries the argument: Keynes is symptomatic, not causal—the brilliant emblem of an age of decay that craved painless remedies. His fame, Mises insists, measures the decline of economic understanding rather than any revolution in it.

They longed for short cuts to an earthly paradise: a protective tariff, a cheap money policy, the closed shop, doles, and social security.

Booms and busts, on the popular account, are the market's own disease; Mises answers that they are inflicted—produced by the very banks and governments that claim to cure them. This 1951 essay defends the monetary, or circulation-credit, theory: credit expansion artificially lowers the rate of interest, ignites an unsustainable boom, and guarantees the depression that follows, because bank credit cannot conjure the real capital goods the boom pretends to command. Against Marxian tales of capitalist 'anarchy' and against Alvin Hansen's case for countercyclical management, he redefines the terms of debate—whoever explains the slump controls the remedies thought available. The only safeguard, he concludes, is to let the market rather than the state set interest rates and to refuse credit expansion and deficit spending through the commercial banks.

They fail to realize that it is impossible to substitute additional bank credit for nonexistent capital goods and that therefore an artificially created boom must collapse and turn into a slump.

By the end of the First World War, Hayek recalls, liberalism had all but ceased to be a living tradition for the young, kept alive only in the rhetoric of aging statesmen who no longer stirred the imagination. This short tribute to Ludwig von Mises, given here in the 1967 translation of the 1951 original, traces how economic freedom survived that eclipse through scattered teachers rather than parties: Edwin Cannan and his London pupils, Mises and the Austrian circle, Frank Knight and the Chicago school, and the German neoliberals Walter Eucken and Wilhelm Röpke. Mises holds the centre as the one thinker who rebuilt liberal doctrine most systematically. Liberalism, Hayek concludes, is less a policy preference than an inherited discipline that must be taught, translated and renewed before it can again become a living body of thought.

Gone is the day when the few remaining liberals each went his own way in solitude and derision; gone the day when they found no response among the young.

Twenty years after Richard Kahn's 1931 article first set the multiplier out precisely, this survey weighs what that achievement really was. Kahn's originality, Shackle argues, lay less in an unprecedented intuition than in converting a vague, politically urgent idea about public works into a usable analytical instrument, above all by asking when extra spending would raise output rather than prices. He traces three tributaries into the General Theory: Kahn's employment multiplier, Meade's ex post equality of saving and investment, and Warming's insistence that net saving cannot exist without the investment that generates it. Yet the elementary geometric series, he cautions, conceals problems of aggregation, distribution, timing, and expectation. Comparative statics cannot separate past from future or intention from outcome, which is why he sets Hicks's elegant but deliberately non-expectational trade-cycle model against his own expectation-reaction view.

This is the bare bones of the multiplier principle. Its simplicity and ‘obviousness’ are illusory.

Writing in tribute to Abraham Wald, Gerhard Tintner asks what mathematical rigor can secure for economics—and where its assumptions limit practical use. This 1952 memorial survey distinguishes the formulation of equilibrium equations from proofs that economically admissible solutions exist. It also shows how cost-of-living comparisons depend on information about preferences that observed prices and purchases alone cannot supply. Tintner’s appreciation is not uncritical: he questions minimax decision rules that treat an indifferent Nature as an adversary, and the feasibility of measuring social losses for policy decisions. The article offers a compact encounter with Wald’s achievements through an economist’s discriminating perspective, revealing both the power of explicit assumptions and the empirical work still needed to make formal results useful.

That devaluing a currency must worsen a country's terms of trade was, in 1952, an assumption widely taken for granted, and this compact theoretical note, reprinted here, sets out to dismantle it. Haberler's thesis is deliberately asymmetrical: in the normal case, where depreciation improves the balance of payments, the terms of trade may move either way and cannot be predicted a priori; only in the perverse case, where the balance of payments worsens, must they deteriorate. Working through demand and supply curves priced in dollars, he shows that a depreciation lowers both export and import prices measured in dollars, so one cannot pair dearer imports with cheaper exports and infer a loss. Against Joan Robinson's presumption that supply elasticities generally exceed demand elasticities, he denies that any broad generalization holds.

We have, then, the result that export and import prices move in the same direction.

What does practically effective economic training lose when specialization separates it from broader theoretical inquiry? In this 1952 study, Richard Kerschagl connects American university organization with the economics and business administration taught within it. Drawing on teaching experience and conversations with economists, he examines how departmental boundaries, case instruction, and well-funded research shape scholarly priorities. His continental European perspective is explicit: admiration for Mises and methodological breadth informs his criticism of theoretical fragmentation, yet he credits American mathematical methods and specialized research with genuine achievements. The comparison offers readers a concrete account of the institutional conditions behind intellectual differences—and a reciprocal prescription: Europeans need stronger mathematical training, while Americans need better access to European scholarship through languages and translation.

Around 1700 the world's economies resembled one another far more than they would a century later; by the nineteenth century Western Europe had opened a vast productive gap over much of Asia, Africa, and Latin America. That gap, Mises contends in this lecture, sprang not from secret inventions or hoarded technique—engineers, manuals, and machines were available—but from institutions and expectations that made saving, accumulation, and long-term investment worthwhile. Nineteenth-century capital export, distinct from older colonial extraction, financed railways, mines, and ports where opportunity existed but local capital was scarce, rewarding investor and recipient alike. Against Rosa Luxemburg's theory of imperialism he insists capital flowed to serve consumers, not to conquer. His sharpest warning falls on confiscation, debt repudiation, and exchange control, which empty ownership of value without abolishing title—and, he cautions, may once more make war over raw materials thinkable.

Capitalism is not things; it is a mentality.

Routinely misread as an excessive worker demand, profit-sharing in fact more often originates with employers, and Bayer refuses to judge it by tidy lists of pros and cons. Ranging across American, British, French, German, Austrian, and Soviet practice, he tests the Scanlon Plan, the Rucker Plan, the Duisburger Kupferhütte's division of results, and the statutory worker shares of Chile and Peru, then submits them all to economic theory. His sharpest distinction separates genuine entrepreneurial profit from monopoly rent: many schemes, he warns, merely redistribute rent, burdening society twice through restricted output and lost taxes. Real profit-sharing, tied to a base wage at least equal to the industry average, can smooth income during upswings and lift macroeconomic productivity, but only where trust, strong unions, and a policy of economic coordination already prevail.

So führen uns die Probleme der Gewinnbeteiligung hinein in die Gesamtzusammenhänge der Wirtschaft.

English translation: “Thus the problems of profit-sharing lead us into the overall interconnections of the economy.”