The ABCT

In my short synthesis of The Austrian Theory of the Business Cycle published here, I address the essence of the theory highlighting why the business cycle is above all else a monetary phenomenon.




The Austrian Theory of the Business Cycle cannot be fully understood in isolation since at least a basic understanding of Austrian economics is required. In my book Money Cycles - The Curse of an Elastic Money Supply I aim to describe and connect the main concepts and theories necessary to understand the ABCT. For those with a moderate or advanced knowledge of mainstream economics, it is in my experience especially the concepts of human action, subjectivity of valuethe theory of money, and the money creation process that will prove the biggest hurdles.

Here are some must-reads by the masters of the theory of the business cycle (I suggest reading them in the order listed):
Ludwig von Mises, The Theory of Money & Credit - the chapter titled "Money, Credit, and Interest"
Ludwig von Mises, Human Action - the chapter titled "Interest, Credit Expansion, and The Trade Cycle"
Friedrich Hayek,  Prices and Production, - the entire book
Friedrich Hayek, Monetary Theory and The Trade Cycle, - the entire book

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