Austrian School interpretation of the Great Depression

E1017853

Austrian School theory business cycle theory economic interpretation

The Austrian School interpretation of the Great Depression is an economic analysis that attributes the crisis primarily to prior credit expansion and government intervention distorting market signals, rather than to inherent flaws in capitalism.

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Observed surface forms (1)

Surface form	Occurrences
Austrian Business Cycle Theory	1

Statements (50)

Predicate	Object
instanceOf	Austrian School theory ⓘ business cycle theory ⓘ economic interpretation ⓘ
appliesTheory	Austrian business cycle theory NERFINISHED ⓘ
appliesToPeriod	1929–1939 ⓘ
attributesCauseTo	Federal Reserve credit policy in the 1920s ⓘ Hoover administration interventionist policies ⓘ New Deal interventionist policies ⓘ Smoot–Hawley Tariff Act NERFINISHED ⓘ artificially low interest rates ⓘ banking regulations that impeded adjustment ⓘ distortion of relative prices ⓘ government intervention in markets ⓘ malinvestment in capital goods ⓘ monetary expansion in the 1920s ⓘ price rigidity caused by policy ⓘ prior credit expansion ⓘ unsustainable investment boom ⓘ wage rigidity caused by policy ⓘ
basedOnWorkOf	F. A. Hayek’s business cycle writings ⓘ Ludwig von Mises’s theory of money and credit ⓘ
claims	Great Depression was necessary correction of prior distortions ⓘ boom of the 1920s was unsustainable ⓘ deflation was largely consequence of prior inflationary boom ⓘ government attempts to prevent liquidation prolonged the depression ⓘ monetary and fiscal stimulus delayed recovery ⓘ
contrastsWith	Keynesian interpretation of the Great Depression ⓘ institutionalist interpretations of the Great Depression ⓘ monetarist interpretation of the Great Depression ⓘ
deniesCause	inherent instability of capitalism ⓘ insufficient aggregate demand as primary cause ⓘ underconsumption as primary cause ⓘ
emphasizes	importance of market interest rates ⓘ need for liquidation of malinvestments ⓘ price flexibility for recovery ⓘ role of central banking in boom–bust cycles ⓘ structure of production ⓘ time preference in investment decisions ⓘ wage flexibility for recovery ⓘ
focusesOnCountry	United States NERFINISHED ⓘ
hasMainProponent	Friedrich August von Hayek NERFINISHED ⓘ Jesús Huerta de Soto NERFINISHED ⓘ Lionel Robbins NERFINISHED ⓘ Ludwig von Mises NERFINISHED ⓘ Murray N. Rothbard NERFINISHED ⓘ Roger W. Garrison NERFINISHED ⓘ
summarizedIn	Murray N. Rothbard’s book "America’s Great Depression" NERFINISHED ⓘ
usedAsArgumentFor	abolition or strict limitation of central banking ⓘ limited government intervention in recessions ⓘ sound money policies ⓘ

Referenced by (2)

Full triples — surface form annotated when it differs from this entity's canonical label.

America’s Great Depression → notableFor → Austrian School interpretation of the Great Depression ⓘ

The Mystery of Banking → influencedBy → Austrian School interpretation of the Great Depression ⓘ

this entity surface form: Austrian Business Cycle Theory