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The Review of Austrian Economics

, Volume 28, Issue 2, pp 151–165 | Cite as

Expectation in Austrian business cycle theory: Market share matters

  • Nicolas CachanoskyEmail author
Article
First Online:

Abstract

One of the most important objections to the Mises-Hayek business cycle theory is the rational expectations critique. The debate between supporters and critics of the Mises-Hayek theory has not paid sufficient attention to the problem of differences in expectations and the market share in the allocation of production factors. I represent financially the effects that occur under the Austrian business cycle theory in the market of production factors as well as how economic imbalances occur when a central bank follows an expansionary policy and entrepreneurs have different expectations.

Keywords

Austrian business cycle theory Rational expectations Market share EVA(R) Economic value added 
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© Springer Science+Business Media New York 2014

Authors and Affiliations

  1. 1.Department of EconomicsMetropolitan State University of DenverDenverUSA

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