Question

Who are the intellectuals of Neo-Austrian school? Explain their views.

Please clearly and with the max 10-15 sentence

Answer 1

Intellectuals of Neo Austrian School:

1. Carl Menger who is considered founder of Austrian School by many. He

2. Ludwig von Mises

3. Eugen von Bhom Bawerk

4. Friedrich Hayek and many others

The economists of Austrian School tries to solve complex issues with the help of experiments. They believe we can discover truth by simply thinking aloud.

Views of Neo Austrian School:

1. Price Determination

They believe that prices of a commodity is determined by subjective factors like a consumer preference to buy a commodity or not

2. Interest Rate

According to Austrian School interest is also determined by subjective decision of a person to spend money in present or in future

3. Capital Good

According to Austrian School capital glods are not homogenous. It means they are not subtitutef with each other.

4. Business Cycle

They believe that business cycles are caused by disortion of interest rate because of interference of government as government wants to control money supply.

5. Market Creation

Views of Austrian School on market creation is that market is created by the people to make their lives better not by any concious decision. So it is process not outcome of design