The Review of Austrian Economics

, Volume 29, Issue 1, pp 85–92 | Cite as

Hayek’s monetary theory and policy: A note on alleged inconsistency

  • Martin Komrska
  • Marek HudíkEmail author


Challenging the dominant view, we claim that Hayek’s monetary views did not significantly change over his lifetime. The prevalent perception of early Hayek as a money stream stabilizer and late Hayek as a price level stabilizer is attributable to an unjustified normative interpretation of Hayek’s positive analysis. We argue that in his contributions to monetary theory, Hayek took the goals of monetary policy as exogenously given and analysed the efficiency of different means of achieving them. Hayek’s allegedly inconsistent transformation from a critic to an advocate of price level stabilization is explained by a change of issues under his focus, rather than by a change in his positive views. We also claim that Hayek was always aware that every practical monetary policy involves difficult trade-offs and that he was therefore reluctant to impose his own value judgments on what people should strive for.


F. A. Hayek Positive economics Normative economics Monetary policy Austrian business cycle theory Price level stabilization Money stream stabilization 

JEL Classification

B22 B25 B31 B53 E32 E52 



We would like to thank Petr Bartoň, Pavel Potužák and two anonymous referees for their helpful comments on earlier drafts. Any mistakes are, of course, ours.


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Copyright information

© Springer Science+Business Media New York 2015

Authors and Affiliations

  1. 1.Department of EconomicsUniversity of Economics, PraguePrague 3Czech Republic
  2. 2.Centre for Theoretical StudyCharles University, PraguePrague 1Czech Republic

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