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| Format: | Artículo científico |
| Language: | en |
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Instituto Mises Brasil
2021
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| Online Access: | https://www.redalyc.org/articulo.oa?id=586370158008 https://www.redalyc.org/journal/5863/586370158008/ https://www.redalyc.org/journal/5863/586370158008/html/ https://www.redalyc.org/journal/5863/586370158008/586370158008.epub https://www.redalyc.org/journal/5863/586370158008/movil |
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Table of Contents:
- A Praxeological Theory of Interest Rates Hendrik Hagedorn Multidisciplinarias (Ciencias Sociales) Praxeology Interest Rate Theory History of economic theory This paper starts with the observation that the pure time preference theory leads to conflicting views concerning the effect of changes in productivity on the rate of interest. Subsequently, it reviews the literature on the topic and concludes that the pure time preference theory cannot be considered praxeological. Then, it combines Hülsmann’s theory of interest with the subjectivist capital theories of Lachmann and Kirzner, providing a praxeological theory that explains the rate of interest. The key to that theory is that cost reduction through fixed capital must always be understood in terms of the cost of labor that this capital replaces. Since labor is non-specific and its price also constitutes the production costs of fixed-capital goods to a certain extent, the use of fixed capital necessarily entails a business surplus somewhere in the economic system. Since this surplus cannot disappear, it qualifies as interest income. Its size is such that the interest rate corresponds to the marginal rate of substitution between labor and fixed capital, embodied in entrepreneurial actions. 2021 artículo científico 2318-0811 https://www.redalyc.org/articulo.oa?id=586370158008 https://www.redalyc.org/journal/5863/586370158008/ https://www.redalyc.org/journal/5863/586370158008/html/ https://www.redalyc.org/journal/5863/586370158008/586370158008.epub https://www.redalyc.org/journal/5863/586370158008/movil 10.30800/mises.2021.v9.1431 en http://www.redalyc.org/revista.oa?id=5863 MISES: Interdisciplinary Journal of Philosophy, Law and Economics application/pdf Instituto Mises Brasil MISES: Interdisciplinary Journal of Philosophy, Law and Economics (Brasil) Vol.9