Introduction

The theme of this volume of Advances in Austrian Economics is “Future Directions in Austrian Political Economy”. The theme is intentionally broad in order to leave space for the contributors to explore a wide range of topics and, in the process, to demonstrate that Austrian economics continues to be a progressive research program. Our purpose in this introduction is to provide some context to the papers that follow.

The origins of Austrian economics can be traced back to Carl Menger’s 1871 book, Principles of Economics. Menger along with William Stanley Jevons and Leon Walras were the co-founders of the marginal revolution in economics. The marginal revolution refers to a paradigm shift in economics whereby the labor theory of value was replaced by a subjective theory of value. Menger’s Principles contains a number of important themes, but we briefly highlight three for the purposes of understanding Austrian political economy and the papers in this volume.¹