Suggestions for further reading

Chris M. Sciabarra sciabrrc at is2.NYU.EDU
Wed Sep 27 06:27:38 MDT 1995

In a number of posts last week, I was asked about the Austrian theory of
business cycles, and several related issues.  I would like to recommend
to anyone who is interested, several articles from a variety of sources,
for further reading.  First, I wish to heartily recommend CRITICAL
REVIEW, especially three issues:  Vol, 3, nos. 3&4, which discusses the
Central banking issue in a special edition on "The Keynesian Orthodoxy."
The journal is not strictly libertarian -- it engages people from many
traditions, left and right, by the way.  In this issue, one will find
Steven Horwitz on "Central vs. Free Banking," but also a wonderful
article by Frank Vorhies, "Marx on Money and Crises."  Vorhies did his
dissertation on Marx's theory of money, which is VERY close indeed to
Austrian theory.  (Related to this, Horwitz has done a paper on
Hilferding in HOPE, and Don Lavoie has done a paper on Marx's
disequilibrium theory of money in the Cambridge Journal of Economics.)

Second, there is an excellent debate on the Great Depression in CRITICAL
REVIEW, vol. 5, no. 1, featuring Gene Smiley, Tyler Cowen, and Clifford

Finally, a special CRITICAL REVIEW edition, "The Regulatory State," with
excellent essays on the regulation of banking, and specifically on such
issues as "bubbles," (raised by Steve Keen), which formally confront
Austrian and Post-Keynesian economics.  Also see the articles in this
issue by George Selgin and David Prychitko.

	Oh, and by the way, those who wonder about whether or not
Austrian theory is "endogenous" or "exogenous" -- well, it depends on
one's vantage point.  It is exogenous on one level ONLY if one views the
political intervention as external to the market; it is certainly not
exogenous if one realizes that political intervention has been internal
to the history of markets.  However, it has been noted by Pete Boettke
that the theory is actually endogenous in a different respect, in that it
has an "endogenous theory of the cluster of errors" that one finds in the
boom-bust cycle.  It asks the question--and provides an answer-- "Why did
businessmen en masse commit the same-type of error" in their
investments?  It shows that the errors committed must necessarily be
systemic given the financial origins of the cycle.

	One other observation hinted at above:  there really are some
fascinating parallels here between Austrian cycle theory and Marx's
theory of money.  Perhaps if one looks at Austrian theory with an eye
toward "what do Austrians and Marxists have in common here," one might
emerge with a better understanding of how radical the Austrian theory is,
and how ingenious and original Marx was -- even from the Austrian
						- Chris
Dr. Chris M. Sciabarra
Visiting Scholar, NYU Department of Politics
INTERNET:  sciabrrc at

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