Tuesday, September 29, 2015

Ludwig von Mises: Scholar of Free Markets and Prophet of Liberty

By Robert P. Murphy

September 29 marks the 134th anniversary of the birth of Ludwig von Mises, the tallest giant of the “Austrian School” of economics. Although Mises is not a household name, Nobel laureate Friedrich Hayek once referred to him as “the master of us all.” To this day, professional economists and laypeople alike learn from the writings of a man I consider to be the most important economist of the twentieth century.

One of Mises’s earliest achievements was to bridge the two fields we now call microeconomics and macroeconomics. Originally, the classical economists of the eighteenth and nineteenth centuries had embraced variants of a labor theory of value in their teachings. Then, during the so-called Marginal Revolution of the 1870s, economists replaced the labor theory with the modern subjective theory of value, which sees all market prices as determined ultimately by the underlying preferences of consumers. It doesn’t matter how many labor-hours it takes to manufacture a product, according to subjectivism; if nobody really wants it, it will fetch a low price……To Read More……

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